Posted 4 years ago on March 15, 2012, 3:59 a.m. EST by pewestlake
from Brooklyn, NY
This content is user submitted and not an official statement
A Floating Wage Ratio would work something like this:
"Wages for the highest-paid employee in any enterprise, including public and private, for-profit and not-for-profit, and all subsidiaries owned in whole or in part, may not exceed fifty times the wages for the lowest-paid employee for an equal amount of time. 'Wages' includes all forms of compensation, including but not limited to stocks and stock options, expense accounts, benefits and other perquisites. 'Subsidiaries owned in part' includes vendors when a substantial (more than XX%) of total labor hours incurred by the enterprise has been outsourced. Volunteers and employees who derive a substantial portion (more than XX%) of their wages from voluntary tips are exempt. Phase in: year 1: 250:1; year 2 - 200:1; year 3 - 150:1; year 4 - 100:1; year 5 and thereafter - 50:1."
A flat minimum wage across all industries, even adjusted regionally, doesn't account for wide differences in economic sectors and still allows companies to pay senior executives obscene salaries, which is among the main sources of economic inequity. A wage ratio would be adjusted by enterprise and force a whole new set of priorities in budgeting at the highest levels.
Do they pay themselves a gajillion dollars and raise the receptionist's salary to seven figures? Or do they tamp down the massive payouts and use that money for other things, like reinvestment in the company (stimulative), higher salaries for low-level employees (stimulative), and/or higher dividends (stimulative). It's the closest thing I've seen that would actually make all that wealth trickle down AND keep it in the private sector. It's not government redistribution, it's just a natural cap on how much managers can raid the kitty.
Most high salary executives in America work for publicly held companies. It's not their money and it's not the board's money either. If maximizing shareholder value is the number one tenet of corporate management, excessive salaries are an obvious violation of that principle. Implementing a floating wage ratio would correct that problem by leveraging natural market forces. Salary caps, profit caps and price caps don't work. This is the only way to place a natural cap on excessive corporatist wealth extraction without funneling taxes through the Internal Revenue Service.
It might, however, be important to pass a constitutional amendment that prevents the Supreme Court from equating the spending of money as an expression of speech BEFORE such a law is passed or they may see a reason to use the first amendment to strike it down. Absurd as it obviously is, if SCOTUS already equates spending money with speech, paying a salary must be, too. This has to end.