Let me raise two significant points. One is in the value of work. The second is about consequences.
VALUE OF WORK — HOW VALUE IS DETERMINED
While we like to think we can look at something or someone or what they do and assess a value on its own or relative to other things, the major phenomenon that impacts value of things is supply and demand. Your house might be worth $500K today but if all of a sudden 25,000 homes are built in your medium-sized city next week, the value of your home tanks, even if it looks the same. And, despite how valuable *you* might think it is.
Similarly, we feel that raising children and keeping a home is a valuable task. Many stay-at-home parents bemoan how their work isn’t valued. I completely understand. Yet, we will pay an immigrant worker under the table a wage that may or may not meet minimum wage levels to care for our own kids. Why do we do that since it’s such valuable work? Because we can. Because there is a big supply of caregivers willing to work for that wage. I have not once heard of someone saying “I know this caregiver will work for $15 an hour but this is valuable work, so I pay $30”. Please share your stories in this area as it would be new for me. I don’t see evidence of us practising what we preach…yet.
Same works with CEOs. I know we all like to think they hardly work, while just holding court and ordering people around. But for most that’s very much not the case. It’s a 24/7 job with scope, complexity and stress levels that few of us could ever understand.
I appeal to anyone who has ever gotten promoted to supervisor or manager. Would you say you get more salary but your job is soooo much easier now because you have others to do all the work? Nope. You’d probably say your job is a lot more stressful. Way more than you expected. Now take that stress and double it. Double it again. Then triple it. Then multiply it by ten. Keep going for a few mins and you’ll get a sense of what a CEO job is like. Maybe.
There are very very few people who can hack the job. How it takes you away from your family and compromises your health among other things. It’s seriously intense and inescapable. It’s supply and demand. I suggest that instead of hating on them you work your way into that kind of role. It’s a free world. Go get that $$ for yourself instead of hating others for doing it. Waste of negative emotion, in my world.
This is a globally competitive market. The US (or Canada where I am) doesn’t operate in a vacuum. Do you really think that taxing wealthy people to 95% or whatever will cause middle class prosperity and all will be grand? Hardly. Venezuelans and Egyptians aren’t in big world-wide employment demand sad to say, while they as well face issues with freedom of mobility. Not so for us North Americans.
The economy would over time implode. Entrepreneurs will take steps to stifle growth of their companies to avoid big tax brackets. I mean, why put in the work to grow when you have to give the money away…?
And oh yeah, growing companies hire people. Lots of them. Heck we wouldn’t want that now would we? We for some reason still expect governments to create jobs but they don’t hire many people. Successful businesses hire people so we need to be looking in the right place.
As well, larger companies would just plain relocate because they can’t hire CEOs at a globally-competitive wage. And take the tens of thousands of jobs with them.
Are we only showing bias against CEOs or are we looking to stifle the film and entertainment industry while we’re at it? Perhaps shut down the NBA and the NFL? Those unpaid league interns make far less (ie nothing) compared to those athletes @ $25M/a. Why do we never mention athletes or celebrities or musicians in our hate over income inequality….or are we too busy pleading with them on instagram to acknowledge our comments?
And there are always loopholes. You can defer wealth payments until the CEO retires and relocates to the Bahamas, at which time they will draw their salaries. They can get stocks instead. Large companies will break into smaller ones should we want CEOs of smaller companies to be exempt. Many many ways around it.
One big thing to keep in mind. Strong economies create net wealth for everyone. Crappy economies lead to belt tightening all around. The best way to have a strong economy with job creation is to have healthy business. It is THE necessity. And what goes with that sure is top level execs who get paid. Necessary evil.
It blows my mind how we have such a hate-on for CEOs and big business. It’s literally biting the hands that feed us.
Maybe your post is just thinking out loud, but trust me, your suggestion will never happen. It’s just not thought through. Having said that I’m not opposed to a discussion of wage gaps, especially between men and women or minimum wage.
PS I grew up lower middle class, just above poverty line. I worked hard, financed a lot of education for myself and put a heck of a lot of hours in. Finally, now I’m making it…and my next step is to be a C-level exec of a smaller company that stands to become big. And, no, you’re not coming for my money. Sorry.