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Original post by Quasimojo Quote:
Original post by KhaiyAnd since the wealthy have had everything to do with depressing real wages of the middle and lower classes while their own income has skyrocketed, why shouldn't they bear at least a slightly higher cost? Particularly on things that we all, as a nation, use?
So what you're saying is that it is *not* in the best interests of stock holders for a company to employ loyal, satisfied lower- and middle-class employees?
Where wages are concerned, the wealthy are no more in control than the labor force. If you want to produce a better product or service, you pay your workers enough to both make them content enough to maintain product/service quality and keep them from taking a better deal with your competitors. It's a core concept of free enterprise. Where the fly enters the ointment is when the government steps in to regulate business or help labor unions to strong-arm the employers. That upsets the balance.
It's in the interest of stockholders to keep employees on staff, yes. But it's even more in the interest of stockholders to minimize costs (like wages) and maximize profits. Money that goes into a dividend for stockholders or into salaries for executives is money that doesn't go to wages, and doesn't help spending power for the workers who actually do the things that the company itself provides to consumers.
When a company sends jobs overseas and lays off employees who are now redundant, where do you think that the increased revenue goes? Some to remaining employees, perhaps, but much more to investors and executives. The act of moving jobs overseas drives wages down for those who stay in America. Executives at companies don't have to allocate that money that way, but they do.
And increasing vertical and horizontal consolidation of industries dramatically increases the power that those at the head of large firms have, and reduces the opportunity for consumers to affect change in the market while also providing fewer opportunities for workers to find another company to work for that might offer a different deal.
Some industries need to be regulated. Financial firms, drug companies, and food manufactureres haven't shown themselves to be very trustworthy in self-regulation. The government may not be much better at regulation, but what other alternatives are there? How many companies in the last decade have run on fraud and fantasies, resulting in executives who run off rich and devastation for everyone else?
Collective bargaining can produce unfavorable results (like with auto worker unions in the US), but unions are often the only real defense that workers have against unfair treatment by employers.
In a strong economy workers may have lots of options of where to work. But in a flagging one, they don't. Workers have to settle for fewer hours per pay period now, and lower pay besides. When the company wants more out of them, they just have to threatent to fire them. Meanwhile, executive pay is at all time record levels. How can anyone other than the executives themselves alter this in any way?
You seem to be thinking in line with the core concepts of free market theory, but there's more than just that chapter in an economics textbook. Market failures exist, and lasseiz faire doesn't always produce an optimal outcome. And the "balance" that you cite has been shifting in ways that would be hard to describe as optiaml.
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Original post by Quasimojo
Most of us have every opportunity we need to attain the position where it is less of a burden, as you describe. Sure, it would be a longer road for some than others, but that's life for you. It's not meant to be everyone's burden.
But it's inherently impossible that everyone will. There are only so many jobs that provide the level of income you're describing. There are fewer CEOs than Vice Presidents, and fewer Vice Presidents than middle managers, and fewer middle managers than rank-and-file employees. While opportunity may be abundant (though by no means equal) for most people, there just aren't enough positions for everyone to strike it rich, or even comfortable. That's life for you.
But I'm not saying that income distributions need to be equal. Just that the rich not get record high income and record low taxes on it while those who can't, didn't, or haven't made it there yet get less than ever, despite working more and harder than before.
When general wealth rises then taxation can be less of a burden on everyone. But that's not where we are now. In your own words, it's not meant to be everyone's burden. So why shouldn't the group that currently has record income and record low taxes take on slightly more of it, if they don't want to give others the ability to pay?
