NOM

Pay workers relative to profits:



Greed is always a poor long-term plan.

Yup.

I approve this message.

Yeah, this is a big part of the problem. Makes me wonder what drove the high and low spikes between 2000 and 2010. Is it due to anything the government did? Is the spike in profits due to unions losing power? I know some people need help. Now instead of tithing I give to homeless shelters. And I generally tip more. What else can I/We do?

deacon blues wrote: ↑Tue May 25, 2021 9:42 am Yeah, this is a big part of the problem. Makes me wonder what drove the high and low spikes between 2000 and 2010. Is it due to anything the government did? Is the spike in profits due to unions losing power? I know some people need help. Now instead of tithing I give to homeless shelters. And I generally tip more. What else can I/We do?

I wonder what caused the profits to spike too. What economic mechanism or reporting requirement changed around 2000? I'm pretty sure the low spike is the recession in 2008.

This graph may not include the impact of the recent tax cuts which should exacerbate this, though those were in 2017 so I would expect it does some. I guess it depends on whether the profits graphed are before or after taxes.

It seems to follow a similar timeline to the jump in the CEO-to-worker compensation ratio.



In the blog that graph came from the author points out that the Clinton administration enacted a bill to cap CEO pay, limiting salary to $1 million/year and requiring that the rest be tied to performance. This was done with stocks. That may have made it easier for boards to give the CEOs more compensation because stocks in those numbers doesn't cost them real money, and incentivized CEOs to do whatever they needed to improve stock performance. So maybe there was some pressure to make profits look healthier than before. I'm sure it's more complicated than that, but there's one narrative!

As for what to do, seize the means of production! But really that's a tough question. Our economy is built around trying to make as much money as possible which includes squeezing labor. I don't know how we could undue the stock for performance compensation; it's a pretty good incentive scheme for the companies and the CEOs are getting rich. I think we should get rid of the tipping economy and require tipping jobs to be paid normal wages like in many other countries. I think the recent labor shortage is pushing lower-end wages up, much to the chagrin of many.

Republican Senator Ron Johnson says wages are "too high".

https://www.youtube.com/watch?v=riiRY6rM92w