How much is too much money?

KyussBishop

southsiderosie wrote: »

Two points.

First, if CEOs loot companies, then the companies should be allowed to collapse. But that hasn't been the case. Stronger enforcement of anti-trust law over time might make companies, and in particular corporate boards, more watchful, since they would know that they could not merge their way out of trouble to the point where the government would have to step in to rescue them.

Second, there isn't actually a great deal of empirical evidence that links spending on elections to broader outcomes (individuals are somewhat different). The 2013 elections are a prime example: Karl Rove's group got $200 million in donations, and not only did Republicans fail to take the White House, they failed to take the Senate as well.

I think caps on lobbying make sense because they fuel the perception that the government is for sale, but in the case of the US, I think gerrymandering has had a much more pernicious effect on the Congress than money.

Letting companies collapse, from CEO's looting them, is harmful to shareholders and society in general though (these CEO's don't care about the company; by the time it collapses they've gotten the salary/bonuses they wanted); granted, it's a distinct problem that aught to be tackled in its own right, but given the difficulty of that in current political conditions, having a wage cap is another good way of discincentivizing this kind of destructive behaviour.

I agree with the rest of what you say on that point though; proper implementation/enforcement of anti-trust laws, and avoiding agglomeration into 'to big to fail' institutions would both help that also.
The problem is that there are dozens of different necessary reforms like this, in many areas, which are politically difficult to achieve, whereas a wage cap helps attack a lot of them in a general way (even if, for sake of argument, it may not be beneficial if all of these other issues are fixed at once).


Additionally, a lot of CEO's/directors pay, as set by boards and shareholders, is highly related to short-term profits, which can often lead to socially destructive activity by the company; the situation here would not be CEO's looking to outright loot companies, but who are still looking to bump their pay based upon short-term profits.

A pay cap wouldn't stop this entirely, but it would set an upper-end limit to it, helping to disincentivize short-term profit seeking, and possibly incentivize long-term stability in profits instead (which would be better for not just the company, but society overall).


On your second point, while I agree that money may not necessarily affect the outcome of elections (and even appointments in congress), it still seems that both the Democrats and Republicans are heavily in the pockets of finance and other monied interests; there are revolving doors all throughout politics there, with politicians growing close to industry (often those they are regulating), doing them favours, and later ending up in lucrative high-salaried positions and such.

Not all of this is relevant to salary caps granted (and revolving doors are only one aspect of the influence of money on politics), but capping salaries is one of many tools that could be used to help ameliorate much of that.

In general with both the big parties though, I don't think it makes a difference really, which of the two is in power; they both are beholden to big monied interests.


I agree with the caps on lobbying, and the point on gerrymandering, but again go back to the idea that a wage cap attacks a lot of things in a general way, whereas attacking these other individual (and perfectly relevant) issues, may be politically more difficult and take longer.

A general wage cap also may be preventative or counteractive, should any of these other issues be 'unfixed'/reintroduced in the future, though I haven't really thought of this aspect in detail before.

Hanley

Dwork wrote: »

I have to earn 1.2 million a year to break even. Anything above that's a profit. 116k? Alright for a month, but that's about it. It depends on your circumstances. And yes, the tools are about to descend on me for my honesty. 116k is unimaginably huge to some. It was once to me. Now, it's just routine and nothing to get excited about. There's loads of others the same, but they'd never admit it, they'd crap on about how it's a "huge" sum of money etc etc. It isn't. It's peanuts. If you need 120K.

I find it extraordinarily unbelievable that a small business tycoon like yourself would confuse "turnover" with "salary".

Consider your bull**** called.

EDIT: And if for some reason you've just made a mistake and have done all the things you've said - kudos.

southsiderosie

KyussBishop wrote: »

Letting companies collapse, from CEO's looting them, is harmful to shareholders...

OK, I can't get past this first sentence: that is part of the risk of being a shareholder! Shareholders can't collect in good times and then expect the rest of us to pick up the pieces in the bad times - that has been the fundamental problem with a lot of these companies, banks in particular.

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Hanley wrote: »

I find it extraordinarily unbelievable that a small business tycoon like yourself would confuse "turnover" with "salary".

Consider your bull**** called.

EDIT: And if for some reason you've just made a mistake and have done all the things you've said - kudos.

He was in too much of a hurry to let everyone in on such a huge secret (that some people earn vast sums of money. )

DEFTLEFTHAND

The numbers pull in 100,000 a week. The construction industry pay 20 mil a year, prostitution is 500,000 thousand per annum.

If anybody messes with us we ice them. We're wiseguys.

KyussBishop

southsiderosie wrote: »

OK, I can't get past this first sentence: that is part of the risk of being a shareholder! Shareholders can't collect in good times and then expect the rest of us to pick up the pieces in the bad times - that has been the fundamental problem with a lot of these companies, banks in particular.

I agree, and much prefer shareholders taking a hit than government having to step in, but I'm more arguing that CEO's shouldn't be able to loot companies in the first place (and that they don't care about the company or its future when they do so, because they already got their salaries/bonuses), and that the wage cap would be one tool that could be used to help with alleviating that.