Time for a national maximum wage.

ei.sdraob

dvpower wrote: »

Instead of a maximum wage, how about a super tax? Say 65% on earnings over €200,000. Not too draconian but might be a quid pro quo for getting through a reduction in the minimum wage.

there aint that many people yearning that much to make a slightest bit of difference to the hole we are in

and the super rich are masters at avoiding taxes thru various loopholes and offshore arrangements

nesf

ei.sdraob wrote: »

and the super rich are masters at avoiding taxes thru various loopholes and offshore arrangements

Or more accurately they can afford to hire accountants to figure it out for them and still make money doing it. Wealth taxes don't work well, plus we capture quite a lot of their wealth through VAT etc anyway.

ressem

A national maximum wage isn't a runner, but a number of countries such as Germany and Japan have a usual case of paying about 8 times the average company wage to the CEO/ directors, rather than numbers in the millions.

Of course that is to benefit the shareholders, not the 'national interest', and is because the benefit of paying much more doesn't seem to be worthwhile.

OffTopic... Some of their other practices would appear to be of greater benefit, such as the company board of directors having a clear and distinct split, between the executive (headed by CEO) and supervisory roles (headed by chairman).

Hookey

dvpower wrote: »

Instead of a maximum wage, how about a super tax? Say 65% on earnings over €200,000. Not too draconian but might be a quid pro quo for getting through a reduction in the minimum wage.

It wouldn't actually earn that much tax revenue; there are approx 24,000 people earning between €200K and €500k, with an average salary of €204,207 (which shows those 24K people are heavily skewed towards the "low end" of that pay range), so you'd only be charging the 65% rate on an average of €4200, or approx. €66M in tax revenue. Not trivial, but nowhere near enough to fill the hole. The problem of course is that as you get into these high salary ranges, you're increasingly in the realm of the self-employed, the partner or company owner, who have lots of ways to shift their tax burden around. This doesn't mean it shouldn't be done (so long as you accept that the very best talent will go elsewhere), but it would probably generate rather less than €66m.

As for the OP's idea; ridiculous; you may as well burn down what remains of Irish industry right now.

seamus

National Maximum wage == socialism. No way. Aside from taxation, it's none of the government's business how much a private company wishes to pay private individuals. It would be a barrier to economic growth and would stifle development because companies would be less encouraged to invest in R&D in Ireland, since ultimately the people at the top of the chain can't benefit from improving the quality and efficiency of their business.

It's exactly this type of "capping" and benchmarking of salary/wage levels which makes the public sector a cesspit of inefficiency.

However, I support the tone of the OP and public sector wages at the higher levels, including the judiciary, should be adjusted on far more scientific and calculable rates than we currently do.
There's no reason why the salaries of everyone in the public sector can't be linked to economic growth/decline. So if the economy inflates by 5% in a given year (and government income inflates by the same amount), salaries increase by 5%. If the economy deflates, salaries deflate.
And If the politicians wish to increase their salaries outside of these standard rates, they must put the request to referendum. I've never understood the logic of TDs being allowed to award themselves pay increases. Most of us are given enough autonomy to decide how our job is done, but we still have to ask our boss if we want a pay rise. The people are the boss.

MG

Goes without saying (almost) that this is a bad idea that would be a disincentive to work and create a huge black economy.

The only place I've heard of a max wage was in the 50s in UK football. It didn't work and was scrapped, unsurprisingly (partly thanks to Jimmy Hill. Good man Jim)

P. Breathnach

seamus wrote: »

National Maximum wage == socialism...

That's an American-style post: anything that the state does or might do that you do not like is labelled socialism, and that is taken to be a crushing response.

Setting a maximum wage is not socialism, and not everything about socialism is unquestionably bad.

seamus

P. Breathnach wrote: »

That's an American-style post: anything that the state does or might do that you do not like is labelled socialism, and that is taken to be a crushing response.

Setting a maximum wage is not socialism, and not everything about socialism is unquestionably bad.

Anything which attempts to limit earnings is effectively socialism. Any attempt by the state to tell private bodies what they must pay someone is also socialism.

No, socialism isn't inherently bad, it has plenty of principles far superior to the ultra-capitalist American ideal, but where it gets involved in compensation for work done, it invariably comes down on the side which is less beneficial from an economic point of view.

tlev

P. Breathnach wrote: »

That's an American-style post: anything that the state does or might do that you do not like is labelled socialism, and that is taken to be a crushing response.

Setting a maximum wage is not socialism, and not everything about socialism is unquestionably bad.

No but limiting the amount you can make in a capitalist economy is bad. Motivates people to either a) leave b)make money illegally

Does anyone see ibec or imse recognising their role in the rise of rip off ireland?..
And all these economists that believe in the free market as being the most important thing in the history of the universe seem to miss the fact that in the last two years capitalisms shortcomings have become apparent..

MG

P. Breathnach wrote: »

That's an American-style post: anything that the state does or might do that you do not like is labelled socialism, and that is taken to be a crushing response.

Setting a maximum wage is not socialism, and not everything about socialism is unquestionably bad.

Not everything American is bad either

nesf

P. Breathnach wrote: »

That's an American-style post: anything that the state does or might do that you do not like is labelled socialism, and that is taken to be a crushing response.

Setting a maximum wage is not socialism, and not everything about socialism is unquestionably bad.

Semantically yes you're completely correct but realistically any kind of wage control is statism on a level similar to socialism. I can see some kind of argument for a limit being placed on salaries paid out by the State but to limit private sector salaries is much bigger and restrictive step.

Boggle

I agree with the OP, although I would make allowances for once off windfalls such as patents or the sale of a (one) business.
Like I said on a different site, 150k is a lot of money. It only stops feeling that way when the guy next to you is on 500k.

And, personally I reckon it would stimulate high end investment in the country as we have a rich talent pool here and, if the company knew they could get 10 top end guys here for the price of one abroad, then it makes sense to locate your top end divisions here such as R&D etc.

I would enforce it through 100% tax above a certain point though and make it applicable to even earnings made abroad and if anybody chooses to emigrate to avoid it I would strip them of their Irish passport and bar them from entering the country. (Maybe not that harsh but not far off)

BTW, I'm no socialist and I hate unions but I tink this would make for a better and more equal country to the detriment of the very few.

seamus

Boggle wrote: »

And, personally I reckon it would stimulate high end investment in the country as we have a rich talent pool here and, if the company knew they could get 10 top end guys here for the price of one abroad, then it makes sense to locate your top end divisions here such as R&D etc.

But you wouldn't get 10 top-end guys here. Because if they were that good, they'd have been offered a much bigger package overseas including a huge house, car, bonusses and all sorts of other paid expenses that they could never get in Ireland because you've limited their compensation.
And so R & D would die because the guys running the business have little encouragment to improve their output/efficiency/earnings because their wages are capped.

I would enforce it through 100% tax above a certain point though and make it applicable to even earnings made abroad and if anybody chooses to emigrate to avoid it I would strip them of their Irish passport and bar them from entering the country. (Maybe not that harsh but not far off)

We're signed up to various treaties which mean that we cannot "uncitizen" anyone if it would leave them without citizenship. So they can emigrate with the above company, say "Fu*ck you" to Ireland (quite rightly) who can't tax them from abroad, get citizenship in the country of their choice after a few years, surrender their Irish passport and then travel freely on their new citizenship. Even back to Ireland.

Boggle

But you wouldn't get 10 top-end guys here. Because if they were that good, they'd have been offered a much bigger package overseas including a huge house, car, bonusses and all sorts of other paid expenses that they could never get in Ireland because you've limited their compensation.
And so R & D would die because the guys running the business have little encouragment to improve their output/efficiency/earnings because their wages are capped.

Believe it or not, not everybody is prepared to leave their home and family just for more money. Also, how long before most of the companies relocate their top end departments to ireland to improve their bottom line?

We're signed up to various treaties which mean that we cannot "uncitizen" anyone if it would leave them without citizenship. So they can emigrate with the above company, say "Fu*ck you" to Ireland (quite rightly) who can't tax them from abroad, get citizenship in the country of their choice after a few years, surrender their Irish passport and then travel freely on their new citizenship. Even back to Ireland.

No such thing as can't seamus. Don't america have some policy of taxing their citizens even when abroad?

seamus

Boggle wrote: »

Believe it or not, not everybody is prepared to leave their home and family just for more money.

Everybody can be bought, particularly those at the top. You don't get to the top without making shedloads of sacrifices, it would be rare that a "top guy" (or woman) would stand firm in the face of a massive salary increase. In fact most people have a price. If a company offered you a home, a car, expenses and €500k a year, but the job is in London, would you turn it down and stay here?

Also, how long before most of the companies relocate their top end departments to ireland to improve their bottom line?

But they wouldn't. Chrysler (for example) might relocate, pick up an Irish whizz for €200k a year and be happy for two years. Then Ford (assuming they're not the same company) say, "We have to get this guy", offer him €600k a year working from an office in Belfast, and the guy jumps ship. That's exactly what would happen. Anyone who relocated here won't get the "top guys" because the top guys will emigrate. Or at least most of them will.

No such thing as can't seamus. Don't america have some policy of taxing their citizens even when abroad?

I'm not sure how it works, but if someone doesn't return to the US and doesn't have a US bank account, there's pretty much nothing they can do about it. You can also file a zero return and say, "I don't live here, I live elsewhere and I made no money last year.". They have no way of finding out if you did or not.

tlev

If someone offered me 500k a year and car etc. I would be gone in a heartbeat. Call me materialistic....:D

Boggle

I'm not sure how it works, but if someone doesn't return to the US and doesn't have a US bank account, there's pretty much nothing they can do about it. You can also file a zero return and say, "I don't live here, I live elsewhere and I made no money last year.". They have no way of finding out if you did or not.

Yeah, I haven't a clue how it works either - its just something I've heard being referred to more than anything.

But they wouldn't. Chrysler (for example) might relocate, pick up an Irish whizz for €200k a year and be happy for two years. Then Ford (assuming they're not the same company) say, "We have to get this guy", offer him €600k a year working from an office in Belfast, and the guy jumps ship. That's exactly what would happen. Anyone who relocated here won't get the "top guys" because the top guys will emigrate. Or at least most of them will.

We have quite a practical and well educated workforce (or at least we have untill FF are finished) so for every so called top guy who leaves, two will jump up and down begging for a chance to prove themselves. Believe me, especially in engineering, the so called top guys are generally nowhere near as good as they'd have you believe.
Also, 4 decent guys can outwork 1 great guy anyday (with your 600vs 150k example) - all it takes, especially with engineering and design, is practical experience.
Don't get me wrong though, some guys will leave but I think there's plenty of others there to replace them and companies will just start viewing families and ties to Ireland as a good thing. You'd never know, maybe they'll make sure that their good employees can have plenty of time with their families and aren't overburdened with work which can only make for a better country on the whole.

By the way, which of Irelands top execs have been worth their money over the past few years??? Does this mean that, maybe, paying more and more for something does not necessarily produce a return?


Edit: I haven't worked out the details of this by any means, but I believe that a more equal society is a better society and some means like a max wage would benefit society as a whole. Althouh taking 150k is just a random figure and it could be higher or lower.

tinkerbell

Capping wages is a ridiculous idea. It doesn't encourage anything in the jobs sector. If a company wants to pay an individual €1m per year then so be it. The higher the private sector wages are, the more income tax the government gets.

Perhaps the idiots in government right now may want to look at the fools they are paying a full salary and bonus for in the infamous "rubber room" because they can't get rid of them, and such people are literally sitting around all day reading a newspaper. And finally well done to the govt for clamping down on social welfare fraud, they've saved themselves €226m already, idiots for not doing it sooner.

Boggle

tinkerbell wrote: »

Capping wages is a ridiculous idea. It doesn't encourage anything in the jobs sector. If a company wants to pay an individual €1m per year then so be it. The higher the private sector wages are, the more income tax the government gets.

Perhaps the idiots in government right now may want to look at the fools they are paying a full salary and bonus for in the infamous "rubber room" because they can't get rid of them, and such people are literally sitting around all day reading a newspaper. And finally well done to the govt for clamping down on social welfare fraud, they've saved themselves €226m already, idiots for not doing it sooner.

Just because its a radical idea does not make it ridiculous.
At the very least we should be talking about multilpe tax bands for those on 60k, 100k, 150k plus (instead of the two we currenly have). Oh, and instead of a tax free allowance I'd put in a 1% or 5% (low) tax band so that everybody contributes something to the running of the country - even if it is only a measly few euro in the week.

TheInquisitor

Boggle wrote: »

Just because its a radical idea does not make it ridiculous.
At the very least we should be talking about multilpe tax bands for those on 60k, 100k, 150k plus (instead of the two we currenly have). Oh, and instead of a tax free allowance I'd put in a 1% or 5% (low) tax band so that everybody contributes something to the running of the country - even if it is only a measly few euro in the week.

Am i the only person to realise this guy thats wants to absolutely destroy our country is from London...?

dvpower

nesf wrote: »

How is it quid pro quo? Do you think everyone employing people on the minimum wage earns over 200K a year?

Of course not. I'm thinking more along the lines of making the more well off contribute some more in return for lowering the minimum wage (thus making the less well off contribute more).

ei.sdraob wrote: »

there aint that many people yearning that much to make a slightest bit of difference to the hole we are in

and the super rich are masters at avoiding taxes thru various loopholes and offshore arrangements

Introducing a super tax wouldn't be a big earner; more of a (perception of) fairness thing. By the way, I wouldn't consider those earning €200,000 as super rich.

P. Breathnach

dvpower wrote: »

... Introducing a super tax wouldn't be a big earner; more of a (perception of) fairness thing.

I think fairness, and the sense of fairness, matter a great deal. I hope that I am not alone in that.

By the way, I wouldn't consider those earning €200,000 as super rich.

Unless the €200k is an exceptional increase to their normal income, they are far from poor.

Lockstep

I see no problem with a maximum wage for companies which are bailed out using public finances, until they have paid back the balance.

Spudmonkey

kickoutthejams wrote: »

I see no problem with a maximum wage for companies which are bailed out using public finances, until they have paid back the balance.

Does this include many public services which are currently been bailed out by borrowing 400 million per week?....... Or do you just mean the banks?

Lockstep

Yes. If you recieve public money take a cap on your earnings.

Spudmonkey

Spudmonkey wrote: »

Does this include many public services which are currently been bailed out by borrowing 400 million per week?....... Or do you just mean the banks?

well it should..

Spudmonkey

Deleted User wrote: »

well it should..

Sarcasm... :rolleyes:

hobochris

This is a great Idea*






* If you want all the educated professionals to flee the country.

Boggle

TheInquisitor wrote: »

Am i the only person to realise this guy thats wants to absolutely destroy our country is from London...?

Lived in London a while ago - never changed my profile when I came back.

I fin it amusing that you think I want to destroy the country when, looking around, its pretty fubar'd already...