Washington Post Special Report: Breakaway Wealth

[waterytart]

I don't have a problem with people getting paid what a fair market will bear, be it a lot or a little.

Unfortunately, CEO pay is no longer a fair market. There's a ton of profits being made, and owners (stockholders) are absentees, so the only people left to decide what chunk of those profits should go to executives is the executives. Of course they have a skewed value of their own worth.

If you let the janitors decide how much janitors are worth on the free market, we'd have multi-millionaire janitors.

Every word true. Expect Elmo to shout at you.

 

[Point of Order]

Tax 'em more.

 

[dooley_womack1]

Sorry, 'tart, but as you can see, Elmoo's job has been outsourced

 

[waterytart]

My bad. JonnyD, expect "Peggy" to yell at you.

 

[CarltonBanks]

How should we go about curbing CEO pay?

90 percent tax on incomes above $5 million.

As late as 1963, the top income tax rate was 91 percent, and as late as 1980 it was 70 percent. I have to believe this became a factor in the boardroom, when there was little personal gain for someone to maximize every last dollar of income potential.

Yeah, forcing people to fork 90 percent of the income over to the Feds will raise the salaries of the working man...

I don't think it's a coincidence that the move toward offshore operations began when top income tax rates dropped below 50 percent and executives realized that by showing profit to shareholders they could make fortunes into the billions.

That may be but how does raising the top tax rate to 90 percent bring those jobs back?

The labor is still cheaper overseas no matter how high the tax rate is.

Now if you're really only interested in punishing people for being rich, well then this is probably a good idea...

The jobs aren't coming back. That train has definitely left the station. As long as it's possible to make billions instead of mere millions by paying some poor foreign schlep in a sweatshop $3 a day, instead of paying a decent living wage to an American worker, then that's the way it's going to be.

$23 an hour is almost $50,000 a year. And that's for somebody who probably doesn't have a college degree.

That's not a livable wage?

That $23 an hour job is a pretty extreme exception nowadays, dontcha think? Most of the manufacturing jobs left pay much less than that.

And the only reason that particular job hasn't been outsourced is probably because it's logistically impossible.

The reason jobs are being outsourced is because the labor unions in this country have made labor too expensive. the CEOs have a responsibility to their shareholders. If they can either pay a union member in the United States $23.00 an hour, plus benefits, plus deal with the headaches of the union making the workers call an electrician to change a light bulb and call a custodian to clean up a mess on the floor...or pay some company in Korea who hires people for $4 an hour to do the same work? And are THRILLED to have the job.

The labor unions have outlived their usefulness and are a big part of why manufacturing in the country is dying. It costs so much money to run a union factory that it no longer makes economic sense.

You have a fair point. But should Americans have to settle for making $3 a day like their counterparts in Vietnam do? Or even half of that $23 per hour example given before? Especially when the cost of living in the United States is many times what it is in Vietnam?

And remember, it's not just the unionized factory workers who are seeing their jobs get outsourced. It's customer service representatives. It's also the computer programmers and engineers and scientific researchers who aren't unionized. They spend hundreds of thousands of dollars on on getting doctorates in cutting edge fields yet can't get jobs because the CEO can now outsource that highly-skilled job to someone in India with a PhD for a fraction of the cost of having that person on their own staff in the United States.

I hate it as much as the next guy. It's a problem that does not seem to have a solution as long as these third world countries are willing to work for so much less...

At the same time we have to stop the ignorant things here that burden a company. The Boeing company that wants to build a plant in South Carolina is a perfect example. The National Labor Relations Board is going after them because they are closing a union shop and moving the plant to a right to work state...even though the union members want to decertify the union so they can keep their jobs. Why would the government get in the way of a company that wants to keep jobs in this country? So the new factory will not be a union shop...would Uncle Sam rather see the plant open in Cambodia or Uraguay (just being facetious...I have no idea if they have plans to eventually take it overseas if they cannot move to South Carolina). The problem, as always, is politics.

I would love to see Detroit (or, for that matter, the Ford Plant my mother worked at as the payroll executive and I worked at on the line for a few years, which is now closed) become the Motor City again. I would love to see Pittsburgh and Cleveland cranking out steel. But it is not cost effective anymore, and the price of labor and the legacy union members is the main reason. Every General Motors car produced in Detroit has $2,500 worth of pension and retiree health care benefits attached to it. How can they compete with that? How can they actually make money when Toyota or Honda does not have to follow the same rules because they are built in right to work states?

I don't hate unions...I just see how they are killing some American company's ability to compete. And I don't see how it can be fixed.

 

[Baron Scicluna]

How should we go about curbing CEO pay?

90 percent tax on incomes above $5 million.

As late as 1963, the top income tax rate was 91 percent, and as late as 1980 it was 70 percent. I have to believe this became a factor in the boardroom, when there was little personal gain for someone to maximize every last dollar of income potential.

Yeah, forcing people to fork 90 percent of the income over to the Feds will raise the salaries of the working man...

I don't think it's a coincidence that the move toward offshore operations began when top income tax rates dropped below 50 percent and executives realized that by showing profit to shareholders they could make fortunes into the billions.

That may be but how does raising the top tax rate to 90 percent bring those jobs back?

The labor is still cheaper overseas no matter how high the tax rate is.

Now if you're really only interested in punishing people for being rich, well then this is probably a good idea...

The jobs aren't coming back. That train has definitely left the station. As long as it's possible to make billions instead of mere millions by paying some poor foreign schlep in a sweatshop $3 a day, instead of paying a decent living wage to an American worker, then that's the way it's going to be.

$23 an hour is almost $50,000 a year. And that's for somebody who probably doesn't have a college degree.

That's not a livable wage?

That $23 an hour job is a pretty extreme exception nowadays, dontcha think? Most of the manufacturing jobs left pay much less than that.

And the only reason that particular job hasn't been outsourced is probably because it's logistically impossible.

The reason jobs are being outsourced is because the labor unions in this country have made labor too expensive. the CEOs have a responsibility to their shareholders. If they can either pay a union member in the United States $23.00 an hour, plus benefits, plus deal with the headaches of the union making the workers call an electrician to change a light bulb and call a custodian to clean up a mess on the floor...or pay some company in Korea who hires people for $4 an hour to do the same work? And are THRILLED to have the job.

The labor unions have outlived their usefulness and are a big part of why manufacturing in the country is dying. It costs so much money to run a union factory that it no longer makes economic sense.

You have a fair point. But should Americans have to settle for making $3 a day like their counterparts in Vietnam do? Or even half of that $23 per hour example given before? Especially when the cost of living in the United States is many times what it is in Vietnam?

And remember, it's not just the unionized factory workers who are seeing their jobs get outsourced. It's customer service representatives. It's also the computer programmers and engineers and scientific researchers who aren't unionized. They spend hundreds of thousands of dollars on on getting doctorates in cutting edge fields yet can't get jobs because the CEO can now outsource that highly-skilled job to someone in India with a PhD for a fraction of the cost of having that person on their own staff in the United States.

I hate it as much as the next guy. It's a problem that does not seem to have a solution as long as these third world countries are willing to work for so much less...

At the same time we have to stop the ignorant things here that burden a company. The Boeing company that wants to build a plant in South Carolina is a perfect example. The National Labor Relations Board is going after them because they are closing a union shop and moving the plant to a right to work state...even though the union members want to decertify the union so they can keep their jobs. Why would the government get in the way of a company that wants to keep jobs in this country? So the new factory will not be a union shop...would Uncle Sam rather see the plant open in Cambodia or Uraguay (just being facetious...I have no idea if they have plans to eventually take it overseas if they cannot move to South Carolina). The problem, as always, is politics.

I would love to see Detroit (or, for that matter, the Ford Plant my mother worked at as the payroll executive and I worked at on the line for a few years, which is now closed) become the Motor City again. I would love to see Pittsburgh and Cleveland cranking out steel. But it is not cost effective anymore, and the price of labor and the legacy union members is the main reason. Every General Motors car produced in Detroit has $2,500 worth of pension and retiree health care benefits attached to it. How can they compete with that? How can they actually make money when Toyota or Honda does not have to follow the same rules because they are built in right to work states?

I don't hate unions...I just see how they are killing some American company's ability to compete. And I don't see how it can be fixed.

It can be fixed by making trade fair.

Put tariffs enough imports so that it isn't more cost effective to have jobs overseas. Chinese companies sell to Chinese. American companies sell to Americans. If we, or they, want to sell to each other, use the other country's standards.

Otherwise, what's the solution? Do we just economically surrender to China, and make workers earn $3 a day? Our economy would totally collapse.

 

[JonnyD]

Put tariffs enough imports so that it isn't more cost effective to have jobs overseas. Chinese companies sell to Chinese. American companies sell to Americans. If we, or they, want to sell to each other, use the other country's standards.

Everything you buy just got fantastically more expensive. You'll see significant amounts of inflation. Even things as simple as the personal computer will soon be out of reach of the lower-middle class.

Otherwise, what's the solution? Do we just economically surrender to China, and make workers earn $3 a day? Our economy would totally collapse.

The solution is to be innovative enough as a country to create better jobs faster than the other ones can be outsourced.

 

[CarltonBanks]

Put tariffs enough imports so that it isn't more cost effective to have jobs overseas. Chinese companies sell to Chinese. American companies sell to Americans. If we, or they, want to sell to each other, use the other country's standards.

Everything you buy just got fantastically more expensive. You'll see significant amounts of inflation. Even things as simple as the personal computer will soon be out of reach of the lower-middle class.

Otherwise, what's the solution? Do we just economically surrender to China, and make workers earn $3 a day? Our economy would totally collapse.

The solution is to be innovative enough as a country to create better jobs faster than the other ones can be outsourced.

Baron does have a good point, however, that we have to operate under trade rules other countries do not have to follow. And we have things like a minimum wage, OSHAA regulations and things of that ilk that put us at a disadvantage from the very beginning. What can be done about that?

 

[Azrael]

What can be done about that?

Set the Wayback Machine for 1890, complete deregulation and the first Gilded Age!

 

[Stitch]

Put tariffs enough imports so that it isn't more cost effective to have jobs overseas. Chinese companies sell to Chinese. American companies sell to Americans. If we, or they, want to sell to each other, use the other country's standards.

Everything you buy just got fantastically more expensive. You'll see significant amounts of inflation. Even things as simple as the personal computer will soon be out of reach of the lower-middle class.

Otherwise, what's the solution? Do we just economically surrender to China, and make workers earn $3 a day? Our economy would totally collapse.

The solution is to be innovative enough as a country to create better jobs faster than the other ones can be outsourced.

Baron does have a good point, however, that we have to operate under trade rules other countries do not have to follow. And we have things like a minimum wage, OSHAA regulations and things of that ilk that put us at a disadvantage from the very beginning. What can be done about that?

The best solution is free movement of goods and labor. Let's take those sweatshop jobs in China.

 

[TheSportsPredictor]

There should be a salary cap.

 

[dixiehack]

Having already made points on one side of the argument, I do feel compelled to point out that a 90% marginal tax rate would be lunacy.

That said, part of the reason Japanese car makers don't have legacy pension and healthcare costs built in is because the government back home takes care of such.