What are your thoughts on having a "maximum wage" as opposed to a "minimum wage"?

Question

This would put a ceiling on the VERY rich only. Say there was a law that no company could pay any individual more than $5 million a year. Ideally, this would force the remaining surplus capital of the company back down the chain to its middle and lower-tier employees. Would this not greatly accelerate the "trickle-down" economics?
Just imagine if Ford Motor company wasn't paying CEOs $200 million a year. Would they still be facing bankruptcy and borrowing from every bank possible?

Answer 1

I would love this, but there's a catch. This would have to be applied universally, all over the world, or any nation that implemented it would suffer a high-end brain drain. Here's why:

Let's say that the US and Canada both agree to cap salaries at $5 million / year, as you suggest. However, no other nation does this. Right away, anyone with asperations to make more than $5 mil / year is going to start looking for work overseas. Given that most really big companies are multi-national, it wouldn't be hard for, say, Bill Gates to get himself a high-end job with SAP (world's biggest / richest business software company) in Germany and make his big bucks there instead. So, all Canada's and the US's best and most successful millionaires would go overseas and start enriching other countries' economies, and we'd be stuck with whomever couldn't get in - the loser millionaires. this may not seem like such a big deal, but over time it would mean that other countries would have a big advantage. If the best and brightest all leave for greener pastures, those of us left behind will be worse off for it.

Sucks, don't it?

Incidentally, this has ALREADY happened. Years ago, the government of Ontario put a cap on the income of doctors (it's a long story...). Now, I can't find myself a family doctor, and I live in the biggest city in Canada! Our locally-trained doctors are moving stateside or to other provinces where they can make more money, and our ER wait times are almost in to double-digits. I've personally spent 8 hours waiting to be seen by a friggin eye doctor in ER...

Answer 2

I'm inclined to believe that a maximum wage or income is not a bad thing. Those who earn the extremely large incomes more often than not have had the advantage of good fortune on there side. Most who earn large incomes do not work harder, longer or with more perserverance than those who earn minimum wages. The opportunity of a better education, sucessful social network, unique idea, family inheritance or other circumstances of good fortune do not entitle anyone to unlimited income. Now that the progressive tax laws have been largely repealed by the devout legislators of the rich, there is a need for some other social remedy which distributes the assets of our sucessful country to more of its citizens.

Obviously, the concpt of more people sharing in the wealth of a nation has got to be good for the future of that nation. By the way, even Henry Ford, founder of Ford Motor Company, became involved in setting a new standard for the working man when he unilaterally insisted his employees be paid twice the going rate for factory workers. His thought was that if he paid his emplyees more, more of his employees could afford to buy Ford cars. I imagine when he did this, he personally as well as many of his top managers earned less income. Not a bad idea coming from an old farmer who was blessed with good timing and some mechaincal ability. He knew where his bread was buttered.

Yes, a maximum wage will be better for all Americans. There simply are not enough Henry Ford's around who understand the concept of the rising tide floating all boats!

Answer 3

Im unsure as to what your question means if Im honest. Though I am tired and that could be why I dont get it. I think people will attack what they don't know or have a grievance against though, or even that which shows the truth of the matter. Ive had several such attacks after trying to find out what 'christens' think about the pagan links in christendom. My question unfortunately was reported and deleted and yet there were many insightful answers on there.. even some totally blinded answers. Although on a forum like this everyone has an opinion and will state it. If that is this person opinion then let it be. It doesn't directly affect anyone does it? Just my opinion.

Answer 4

A maximum wage would not be cosistent with our political and economic systems of freedom. Employers are allowed to pay any person as much as they want: it is their money they can do what they want with it. It doesn't hurt people to be paid alot. And if there were "maximum wage" who says the higer-ups would use the rest to pay other employees?
The reason those CEO's are making so much money is that they have a lot of risk that comes with their work. Every decision they make has a great deal of influence on their corporation, so they are compensated as such. If they fail as a CEO that could ruin their reputation and have a hard time with similar lines awork for the rest of their lives. Being in th epublic spotlight, every decision dissected and scrutinized.

Hope this is of some help.

Answer 5

We, the people, have Eminent Domain over all businesses in the United States. By the "people," I mean the majority of adults who believe that this is a democracy and not a republic. By "eminent domain," I mean something similar to the fact that a bank, through a mortgage, actually owns the house that, for most practical purposes, the homeowner can act like he alone owns it.

But I am not just referring to taxes as fulfilling the duty to Eminent Domain. We, the real Americans, must derive a net benefit from private ownership of business, and we must define its privileges the way we see fit, not the lies about motivation, incentive, risk that the economic fascists spew. We must restrict their privileges, control wages and prices, and outlaw outsourcing and other economic treason. All their oinkonomic theories are one-sided. The truth is that the employees create the value of the investment, the rich and their upper-management flunkies are the hired help, and we, as Americans, must have a balance of power over them. Only a Mama's Boy who hates his father for not getting rich can support this dictatorship of the corporate parasites. These liars are bluffing when they claim that if they can't determine their own profits and salaries they'll just refuse to invest in or run companies. Be a man and stand up to these bullies!

Answer 6

The vast majority of the super-rich derive the bulk of their income from sources other than wages. The CEOs, in particular, are very heavy on options and stock grants.

The problem with U.S. auto makers has nothing to do with executive pay; they waste labor and can't market to save their lives. A six-cylinder U.S.-built Toyota Camry requires 18 man-hours to assemble and sells, on average, for $21,384. A six-cylnider Chevrolet Malibu requires 20 man-hours to assemble and sells for $20,069. The net result is the average Camry sells at a $2,000 profit to the manufacturer, while the average Malibu sells at a small loss. So Toyota has a product that both fetches a higher price and is easier to make...

Answer 7

This is soooo stupid.

First you live in an economy which encourages people to do better, to make more of themselves. THEN you say 'Oh, but you can't do so good that you make too much money."

What a crock. If you don't want the company paying their CEO so much, become a member of the board and take control. Of course they wouldn't be facing bankruptcy if they paid the guy less - they also would not be facing bankruptcy if they paid EVERYONE less!

Right problem, wrong way to fix it. Get real.

Answer 8

That kills one of the most important facets of capitalism....once a person has reached the max they would ultimatley stop trying to improve...no motivator.

Also we would al be forced to pay more taxes. Statistically the top 10% of wage earners in this country account for 70% of the total tax revenue each year. If the top wage earned was reduced the amount of taxes collected from those top wages would also be reduced and the rest of us would pick up the slack...

Answer 9

I've sometimes fantasised about asking my economist friends about inventing yet another kind of 'money' with a name like 'status-money.' It wouldn't be convertible into real dollars, euros, whatever ... it would simply serve as the means of flattering the egos of those executives who only feel employable if they are being paid ridiculous sums. Such money would serve the purpose of allowing the alpha-males to continue to strut in front of one another (this seems to be very important to them), but it could only be spent for purposes that would benefit other people ... people who, according to the Constitution of the United States of America, were created their equals but happened to be born in the wrong bed, or in the wrong country, or whatever.

It's a nice fantasy. I'm sure my economist friends could find a way of knocking it down, but that doesn't stop me playing with it.

Answer 10

It seems to me that when the English did this ... but in another way: by making the taxes on incomes above a certain point so high that it did not pay to work that hard.... it worked in reverse.... people decided to be lazy rather than see diminishing returns for their hard work. I don't know if it is still that way ...

.... people like to excell, so let them ... it seems to me that it is up to the individual businesses to do the policing of their policies, not the government.....

.... too much government control is not good... a government is there only to make sure that basic things go properly .... after that it is up to THE CLERGY!!!! Now, if they cannot make things work, that still is not to be government- controlled ... after all, you don't want to nationalize the monasteries! Have a HEART!!!!!


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