I don’t know if I would call it a symptom as it was the inevitable reality of the US economies movement to becoming global. It’s simple economics. In the 50’s and 60’s US companies customer base was probably about 100 million people, whereas today that customer base is 2-3 billion. It doesn’t take a rocket scientist to figure that the lions share of the exponential increase in profits will go to those at the top.
The other factor is that during this economic transition from a manufacturing economy to a service economy in which many of the jobs created were of the unskilled low wage variety.
But what would the state of the economy look like today in terms of innovation. What would be the incentive for the top tier to innovate and grow the economy with that kind of interference.
One of the major flaws of the study, is to assume our economy would look exactly the same today, with the only difference being a forced change in the pay scale.
It is a symptom . . . of our economic “lacking.”
It is inevitable as long as we continue to “lack.”
Labor is actually small part of producing things like steel and autos.
Whether the (political) goal is to maximize GDP per capita, maximize benefits for the lower half or minimize disparities the method remains the same----> we must (and inevitably will) focus the economy on our area of relative advantage.
What we need to do is to stop shooting ourselves in the foot.
This is what I was initially trying to respond to. The why is that. Why do you think? One really doesn’t have anything to do with the other, but go ahead, tell me why in your opinion.
We have two similarly sized companies. Both are software companies.
One company is led by a real barn burner that has come up with a revolutionary new idea. He leads the effort, and a small number of software engineers translate the CEO’s ideas into reality. There are some number of software developers and coders that do the more mundane work. There is other support staff; HR, etc… And we can’t forget the janitors.
The second company basically maintains an existing software product. Nothing special going on there. Basically the same mixture of people.
The first software company takes off like a rocket with soaring profits. The CEO is a superstar and gets rewarded accordingly. The software engineers reap bonuses and stock options. The software developers and programmers are salaried works. It is unlikely they will see much, if any increase in pay. To do so would price them out of the market, should they decide to move to another company. The same with most of the other employees.
How could one justify paying a janitor more than what they are worth? If I am a janitor making double what other companies are paying janitors, simply because my company is doing extremely well, what happens when I want to move to another company?
Are all companies now required to double the pay of their janitors, because one company has decided to do so? Is that janitor being paid double really worth double the pay, simply because they happened to work at a company that is doing well?
Debt delinquencies for high-income households are rising faster than debt delinquencies for low-income households and are now back to pre-pandemic level!!
If the company is an ESOP, all employees get a piece of that pie.
I am sure the engineers make much more than the janitor…
All employees that work at a start up get stock options.
I do not think you are grasping the concept rewarding all employees, with stock options, or an ESOP program.
I do appreciate your effort, but i have never said the “grunt” workers should get the same pay as a CEO, or their salary double if the company does well.
This is what I’ve been saying, Obama did nothing to stop transfer after housing crises. Millions of people never recovered while liberal elites made billions and billions off of that crises.
Yes.
As I have mentioned before, @Guilds is not wrong to point out that there is a growing wealth disparity.
Where he is wrong is when he tries to attach that to
a lack of research spending,
bad bosses,
greedy rich people
etc…
What is happening is the direct result of Fed Policy and Congressional policy, most often policies enacted to “help the lower classes.” They are dumb policies. That backfire as surely as rent control and rationing backfire They are just more complicated so people don’t see it as easily.
Liberal elites? What industry are you referring to?I did not realize Trump’s former Treasury Sec was a liberal elite.
After the 2008 housing crisis, During Mnuchin’s time overseeing OneWest, the bank carried out 36,000 foreclosures in California, according to the California Reinvestment Coalition, an advocacy group.
I have been working in tech, in Silicon Valley for 30 years. I do not have the time or desire to give you a clinic. Look it up, if you really do not know.
