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Author Topic:   Executive Pay - Good Capitalism Bad Capitalism?
Tangle
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Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


(1)
Message 48 of 135 (824597)
12-01-2017 2:49 AM
Reply to: Message 40 by Minnemooseus
11-29-2017 9:01 PM


Re: What someone gets vs what they earn
Minn writes:
There is nobody smart enough, hardworking enough, trained enough and dedicated enough to earn a billion dollars without leveraging corrupt systems and exploiting people.
There's a confusion of terms here. 'Earn' is the problem.
It implies that the billionaire was paid for his efforts in the same way that a nurse is paid for hers. That is obviously impossible. The billionaire, unlike the nurse, had access to a different mechanism of wealth building over and above the selling of his time and labour - an appreciating asset base.
He is able to build a business or businesses that create wealth and push that wealth back to him in dividends and physical assets. He's using a very large lever to do the work for him. The nurse can't access that lever.
CEO pay is a better equivalence as he is selling his labour in the same way as the nurse (and the footballer). The question is why society values one higher than the other.
In Sweden, the pay gap between the highest paid worker and the lowest is far narrower that in the UK and US. It's simply not true that CEOs need to be paid the amount they are to do the job they do - they don't. What they are paid is a culture-based decision that reflects the values of the society they operate in.
I'd say the US culture is one of free markets and free enterprise closely mirroring survival of the fittest - the American dream requires it. People grab what they can and are admired for it. Trump's defense of paying no tax makes him smart is the epitome of it. Sweden's culture is the opposite, it has a history of understatement, social equity and labour rights. It makes them a happy people. I guess you don't necessarily get what you pay for.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 40 by Minnemooseus, posted 11-29-2017 9:01 PM Minnemooseus has not replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 62 of 135 (824661)
12-01-2017 6:44 PM
Reply to: Message 59 by RAZD
12-01-2017 3:53 PM


Re: What someone gets vs what they earn vs what they are worth
RAZD writes:
Do you think you are getting a fair share of the profit the company makes?
Profit is what is made AFTER payments to employees. Profit is shared with the owners of the company, not the employees of the company. So the question doesn't make finacial sense.
It might make social sense, but not, I fear, inside a capitalist structure as it is currently organised.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 59 by RAZD, posted 12-01-2017 3:53 PM RAZD has replied

Replies to this message:
 Message 63 by Rrhain, posted 12-01-2017 9:53 PM Tangle has replied
 Message 66 by RAZD, posted 12-02-2017 8:54 AM Tangle has replied
 Message 73 by NoNukes, posted 12-02-2017 2:06 PM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 65 of 135 (824670)
12-02-2017 3:10 AM
Reply to: Message 63 by Rrhain
12-01-2017 9:53 PM


Re: What someone gets vs what they earn vs what they are worth
Rrhain writes:
Exactly how would adjusting our fiscal policy to redirect the use of those profits to be back into the company rather than the shareholders be against "capitalism"?
Because if you don't allow profits to be given back to owners, they won't make the investments necessary to create and grow companies.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 63 by Rrhain, posted 12-01-2017 9:53 PM Rrhain has not replied

Replies to this message:
 Message 67 by RAZD, posted 12-02-2017 9:01 AM Tangle has replied
 Message 70 by RAZD, posted 12-02-2017 9:36 AM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 74 of 135 (824698)
12-02-2017 2:16 PM
Reply to: Message 66 by RAZD
12-02-2017 8:54 AM


Re: Corporate Feudalism vs Democracy
RAZD writes:
I find it exceedingly curious that people are happy and proud to have thrown off the yoke of feudal style (king run) government for a democratic style government, but are happy to embrace being serfs in a feudal style corporation.
Like the use of the word 'theft' earlier I don't think there's much mileage to be had trying to compare salaried employees to serfs wearing yokes etc, it's a cartoon view.
Whenever we talk about different countries and their governments it seems that the degree of democracy and voice that the people have is equated to relative freedom and liberty and good things they have. Yet whenever we talk about companies, the degree of democracy and voice that the workers have is not considered important.
I guess that's because a we can all cast a vote but we can't all design an iPhone.
But also companies are a function of the societies they operate in - give a company an unregulated free reign and you get inequality; regulate pay, conditions and trade and you get fairer societies. Don't blame companies blame the societies the operate in.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 66 by RAZD, posted 12-02-2017 8:54 AM RAZD has replied

Replies to this message:
 Message 79 by RAZD, posted 12-02-2017 3:55 PM Tangle has not replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 75 of 135 (824703)
12-02-2017 2:23 PM
Reply to: Message 67 by RAZD
12-02-2017 9:01 AM


Re: What is the basis for fair share allocation to investors?
RAZD writes:
And why does this not hold true for the sweat-equity investors in the company?
Because economics don't work that way. Sweat is cheap and easy to buy.
Are there two kinds of people, elites and peons?
You're resorting to emotive caricatures again. Thers are many kinds of people with varying wealth
Can the company succeed and grow without the workers? No.Can the company succeed and grow without the investors? Yes.
Self-evidently wrong.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 67 by RAZD, posted 12-02-2017 9:01 AM RAZD has replied

Replies to this message:
 Message 80 by RAZD, posted 12-02-2017 4:11 PM Tangle has not replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 76 of 135 (824704)
12-02-2017 2:32 PM
Reply to: Message 70 by RAZD
12-02-2017 9:36 AM


Re: What if the owners or shareholders are the workers?
RAZD writes:
What if the owners are the workers?
What if the shareholders are the workers?
Then you have a cooperative.
Cooperatives have been around for a long time, they work for some forms of business, notably trading organisations. They're a minor part of our economies partly because they are necessarily under capitalised. You can't create a biochemical industry on a co-op model, you can't get the capital.
There's nothing stopping anyone creating co-ops, so why don't they?

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 70 by RAZD, posted 12-02-2017 9:36 AM RAZD has replied

Replies to this message:
 Message 77 by Phat, posted 12-02-2017 2:36 PM Tangle has replied
 Message 78 by RAZD, posted 12-02-2017 3:37 PM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 81 of 135 (824725)
12-02-2017 6:03 PM
Reply to: Message 73 by NoNukes
12-02-2017 2:06 PM


Re: What someone gets vs what they earn vs what they are worth
NoNukes writes:
Profit is what is left after all payments are made. But isn't this really just leaning on definitions rather than policy? If the employees are paid a percentage of revenue minus non-employee costs, and profit is what is left over, how would that scheme be different from profit-sharing as far as the shareholders are concerned?
It doesn't really matter how you play around with the numbers (ignoring taxation differences), you have to create a regime of out payments that result in a profitable company able to compete with other companies in the same market. If you pay your employees more than your competitor you either have to employ fewer people or raise your prices.
Of course regulation can force an even playing field but this can make your country internationally uncompetitve and is not normally an act associated with a country like the USA.
Shareholders invest when the return is sufficient. If employees are also getting a cut, the shareholders might still invest as long as the shareholder's portion is high enough.
Sure but shareholders can choose where to invest, a rational investor wouldn't invest in a company that paid its employees far more that the going rate and was therefore less profitable - all other things being equal.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 73 by NoNukes, posted 12-02-2017 2:06 PM NoNukes has not replied

Replies to this message:
 Message 84 by xongsmith, posted 12-02-2017 6:49 PM Tangle has replied
 Message 86 by RAZD, posted 12-03-2017 9:19 AM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 82 of 135 (824726)
12-02-2017 6:05 PM
Reply to: Message 77 by Phat
12-02-2017 2:36 PM


Re: What if the owners or shareholders are the workers?
Phat writes:
Because the wealthy hold most of the investment money. They are not going to enter into a business deal where they have to provide startup costs and then get a shared return that is less than what they initially spent.
Unless they were just being nice.
Correct, now explain that to RAZ ;-)

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 77 by Phat, posted 12-02-2017 2:36 PM Phat has not replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 83 of 135 (824727)
12-02-2017 6:30 PM
Reply to: Message 78 by RAZD
12-02-2017 3:37 PM


Re: What if the owners or shareholders are the workers?
RAZD writes:
Your biases are showing.
I think not, kettle, just facts. I see you'renot immune from your favourite confirmation bias. Coops are a minority part of your economy - about $658bn out of $19 trillion.
Now that could be due to all the workers being committed to the success of the company instead of just the owner ... or it could be due to consumers supporting their community organizations instead of remote corporations ...
Or it could be due to the co-op being a better model to realize the goal of the entity.
Or it could be that workers are tired of oligarchic corporations. Several co-ops have risen from the ashes of a failed company.
Co-ops are ok, but given that the model has been around forever, you need to explain why they are still a minority part of modern economies. If thy're so obviously great, what's stopping them?

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 78 by RAZD, posted 12-02-2017 3:37 PM RAZD has replied

Replies to this message:
 Message 100 by RAZD, posted 12-04-2017 8:18 AM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 85 of 135 (824730)
12-02-2017 6:59 PM
Reply to: Message 84 by xongsmith
12-02-2017 6:49 PM


Re: What someone gets vs what they earn vs what they are worth
xonngsmith writes:
or maybe you could SELL MORE WIDGETS?
If you have higher costs than your competitors, how can you sell more widgets than them? They will always out compete you on price and eventually force you into unprofitability.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 84 by xongsmith, posted 12-02-2017 6:49 PM xongsmith has not replied

Replies to this message:
 Message 89 by ringo, posted 12-03-2017 1:09 PM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 88 of 135 (824752)
12-03-2017 11:25 AM
Reply to: Message 86 by RAZD
12-03-2017 9:19 AM


Re: What someone gets vs what they earn vs what they are worth
RAZD writes:
False. Costco pays workers more, has the same prices as Walmart. What they don't have is the Waltons.
Co-ops go toe to toe with oligarchist companies in the marketplace and provide products at the same price while paying employees more, because they share.
I'm afraid I know nothing about the relative economics of Costo and Walmart but the argument is moot. There are many examples of efficient and well run co-ops, but you have to deal with the general point of why they're only in a minority in our economies.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 86 by RAZD, posted 12-03-2017 9:19 AM RAZD has seen this message but not replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 90 of 135 (824771)
12-03-2017 2:01 PM
Reply to: Message 89 by ringo
12-03-2017 1:09 PM


Re: What someone gets vs what they earn vs what they are worth
ringo writes:
Customer service.
Customer service, branding, reputation, marketing, packaging, specialisation, distribution etc etc are all ways of diferentiating you service from others which is fine. But if your costs are higher than your competitors and he's doing the same you either take less profit or have higher prices.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 89 by ringo, posted 12-03-2017 1:09 PM ringo has replied

Replies to this message:
 Message 91 by ringo, posted 12-03-2017 2:04 PM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 92 of 135 (824773)
12-03-2017 2:39 PM
Reply to: Message 91 by ringo
12-03-2017 2:04 PM


Re: What someone gets vs what they earn vs what they are worth
ringo writes:
You charge higher prices for better service. You pay your workers better to provide better service. It's a vicious circle.
You don't need to pay your workers more to provide better service. Paying the same person more doesn't change their abilities. It may improve staff turnover and sometimes motivation but it's more likely to make no difference on its own. Customer service is ethos, procedures, supervision and training mainly.
But that apart, it's a myth that people buy products on customer service, it's mostly a customer retention strategy for services. People will tell you all sorts of things about being prepared to spend a bit more for great service but the majority will then go out and buy the cheapest.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 91 by ringo, posted 12-03-2017 2:04 PM ringo has replied

Replies to this message:
 Message 93 by ringo, posted 12-03-2017 2:58 PM Tangle has replied
 Message 97 by xongsmith, posted 12-04-2017 2:11 AM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 94 of 135 (824779)
12-03-2017 4:06 PM
Reply to: Message 93 by ringo
12-03-2017 2:58 PM


Re: What someone gets vs what they earn vs what they are worth
ringo writes:
If that was true, there wouldn't be anybody providing better customer service.
It is true - anonymous online shopping has decimated the personal service of the high street for example, and buyers online will use comparison web sites to find the cheapest.
But it doesn't mean that no-one would specialise in a niche where customer service matters.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 93 by ringo, posted 12-03-2017 2:58 PM ringo has replied

Replies to this message:
 Message 103 by ringo, posted 12-04-2017 10:42 AM Tangle has replied

  
Tangle
Member
Posts: 9486
From: UK
Joined: 10-07-2011
Member Rating: 4.6


Message 101 of 135 (824836)
12-04-2017 9:20 AM
Reply to: Message 100 by RAZD
12-04-2017 8:18 AM


Re: What if the owners or shareholders are the workers?
RAZD writes:
Still think cooperatives are an inconsequential share of the economy?
Yes, because they are. You're confusing progressive liberal policy with cooperative companies.
So I guess the USA has been around forever ...
Don't be a dick, you know I meant that co-ops have been around for a very long time - longer even than the form of company you're railing against, the limited company.
Education and awareness of workers, lower-class and middle-class, that there is a better way. The American Revolution didn't happen spontaneously.
Right, a worker's revolution, how very un-American.
If your country actually wanted more socially conscious policies and practices it would have voted for them, but even obviously beneficial things like good health care gets voted down let alone the sort of state intervention you're talking about. The USA is at the far right of modern democracies, it resists more socially creative and equality based policy and it appears to be where the majority of you want to be.
But to get back to co-ops, the mechanisms have been in place to create them for hundreds of years, you need to work out why they haven't developed the way you'd like them to.
I can give you some ideas if you like but you'll need to get your cognitative dissonance under control first.

Je suis Charlie. Je suis Ahmed. Je suis Juif. Je suis Parisien. I am Mancunian. I am Brum. I am London.I am Finland. Soy Barcelona
"Life, don't talk to me about life" - Marvin the Paranoid Android
"Science adjusts it's views based on what's observed.
Faith is the denial of observation so that Belief can be preserved."
- Tim Minchin, in his beat poem, Storm.

This message is a reply to:
 Message 100 by RAZD, posted 12-04-2017 8:18 AM RAZD has replied

Replies to this message:
 Message 125 by RAZD, posted 12-06-2017 11:59 AM Tangle has replied

  
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