$15 Minimum Wage by 2021!

[TheMaxRebo]

I'm not sure either.

I do mean a literal bill though, not necessarily a tax hike. We should have the info. You had 500 employees that we had to pay $x towards their food costs, and they work for you, so here's your bill....So even if it's cheaper to the company to pay the food stamp bill, at least we get some relief, and new funds to go elsewhere.

Now there are lots of intricacies. At what point would a company be responsible? Is it by profit margin? Revenue? Total Profit? EPS? That is where it would get tricky, for sure. But thanks to IFRS and GAAP, there isn't much legal shifting they could do. They also are all required to comply with SOX as they are publicly traded. Would a company purposefully not take a larger profit to get out of paying that bill? Maybe, but then stock price would suffer, and that 10% would get rowdy......

The tough part with that is that people can need subsidies for a lot of reasons - maybe health care or a family member has financial issues or just other financial issues that come up - perhaps through no fault of their own - and no fault of the company ... that they are paying the person that in "normal" conditions wouldn't need additional support but due to these extreme issues now does. But why is that the responsibility of the company? Should be societies issue to support people that are doing everything they can but due to unforeseen situations just can't get out the whole they are in

and if the person isn't doing all they can to provide for themselves, then isn't that on them, and again, not the companies?

I certainly get your point and at a high level the idea of executives making millions and then those lower needing food stamps doesn't *feel* right, but I think putting something into practice is much more difficult

 

[dlavender]

Honestly, the way to force companies to improve wages without "forcing" them is to probably use the strategy Trump is using...
1. Limit the employee pool - enforcing the border, decreasing visas, etc all have gone into this one...
2. Make it advantageous to use the American pool - redoing NAFTA, some of the tariff threats, reducing the regulations that burden companies for having employees, etc
3. Increase the competition among companies for the limited pool - removing regs to even the big/little playing field, encouraging new businesses, etc

What hasn't been done to help under pt 3 is breaking up the oligopolies...but threats are starting to get filtered through the media...and sometimes a little pressure from the top (the govt) can help as much as actually doing something (and can help as much as pressure from the bottom (the consumer)) - probably shouldn't need that government pressure in a fully functioning capitalist society, but part of the reason we got oligopolies was due to uneven governmental policies, so I guess it evens out...

Wages were up the most in a decade last month...and were up enormously in the rural areas (which have really lagged the pay increases over the decades)...things are happening if we have patience...

Last year, businesses used bonuses to try to keep employees and are now finding out they need to do actual wage increases...this is a good...we are moving in the right direction if we just keep following the path...

I'm not so sure about that. The last time we went regulation soft, credit default swaps starting becoming the beanie baby of their time. I think we are still climbing out of that one.....

Wages are up, see my charts, but the distribution is out of whack.

The rumblings I am seeing (this thread as an example) is showing the growing disdain of the current wage inequality issue. We can deny that its an issue all we want, but the fact remains the argument and vocalization of discontent is growing louder. Fair or not. We can just hope it subsides and corrections work, but I am not hopeful. See the teacher strikes. It brought cities/states to their knees (hyperbolic). No one wants a mass showing like that across industries. It would be a disaster.

 

[Douglas Dubh]

Credit default swaps were caused by regulation, not the lack of it.

 

[dlavender]

The tough part with that is that people can need subsidies for a lot of reasons - maybe health care or a family member has financial issues or just other financial issues that come up - perhaps through no fault of their own - and no fault of the company ... that they are paying the person that in "normal" conditions wouldn't need additional support but due to these extreme issues now does. But why is that the responsibility of the company? Should be societies issue to support people that are doing everything they can but due to unforeseen situations just can't get out the whole they are in

and if the person isn't doing all they can to provide for themselves, then isn't that on them, and again, not the companies?

I certainly get your point and at a high level the idea of executives making millions and then those lower needing food stamps doesn't *feel* right, but I think putting something into practice is much more difficult

It would be difficult, but not impossible.

We have scales for everything. I see your point about not being responsible if you have an employee with a family of 5. Obviously that person would need subsidies outside of what you could reasonably expect the corporation to pick up. What if you had a scale that 1 person for that region would be able to adequately provide for themselves. Average rent/mortgage/monthly utility/food/etc...Whatever the full time pay is that makes that work, the company is billed for the difference?

As you look back on the charts, this wasn't always the case. We shifted to this market based system which has only enriched the top percent. It won't be easy shifting it back, by any means. It won't be a simple policy that magically fixes it all. I just think it needs acknowledgment and some action to start to quell the rising tide. People may be discounting it, but if I was sitting in a C suite, I'd be getting a little nervous. Maybe it never happens past internet boards. But a widespread labor stoppage would be terrible for everyone.

 

[dlavender]

That’s not how unemployment works.

In a way, yes it does....

Your unemployment insurance is related to how many people the company lays off or how much benefits are used by former employees....

Didn't realize we needed to go so deep into that.

 

[TheMaxRebo]

It would be difficult, but not impossible.

We have scales for everything. I see your point about not being responsible if you have an employee with a family of 5. Obviously that person would need subsidies outside of what you could reasonably expect the corporation to pick up. What if you had a scale that 1 person for that region would be able to adequately provide for themselves. Average rent/mortgage/monthly utility/food/etc...Whatever the full time pay is that makes that work, the company is billed for the difference?

As you look back on the charts, this wasn't always the case. We shifted to this market based system which has only enriched the top percent. It won't be easy shifting it back, by any means. It won't be a simple policy that magically fixes it all. I just think it needs acknowledgment and some action to start to quell the rising tide. People may be discounting it, but if I was sitting in a C suite, I'd be getting a little nervous. Maybe it never happens past internet boards. But a widespread labor stoppage would be terrible for everyone.

then you are getting back to the whole "living wage" discussion and saying everyone should get paid the living wage amount - and either you are required to pay each employees that much or else you get a bill from the government to make up the difference - either way you are setting a higher minimum wage/output from the company

Personally what I would like to see is a change to the income tax system where that amount is determined and then for everyone, whatever they make up to that point is tax free, then everything above that is taxed at a one fixed percentage (so the effective tax rate is much higher for those that make much more than that level). For those that make less than the, there are programs to support them

 

[dlavender]

Credit default swaps were caused by regulation, not the lack of it.

That's highly debatable. Another time?

 

[dlavender]

then you are getting back to the whole "living wage" discussion and saying everyone should get paid the living wage amount - and either you are required to pay each employees that much or else you get a bill from the government to make up the difference - either way you are setting a higher minimum wage/output from the company

Personally what I would like to see is a change to the income tax system where that amount is determined and then for everyone, whatever they make up to that point is tax free, then everything above that is taxed at a one fixed percentage (so the effective tax rate is much higher for those that make much more than that level). For those that make less than the, there are programs to support them

I appreciate your responses. Always articulate and well thought out (probably much more so than my off the cuff mostly sarcastic ways)

I get that a mandated living wage or whatever would be very hard to implement and at the very least divisive. Your solution could work, I haven't seen the numbers on the projected affect, but it could be a start.

In my mind, we have to find a way to correct the wage growth. Let the bottom 90% grow a little quicker than what's happening at the top. That's very macro level and I understand the details are tricky at best.

Whatever the solution will be, it wont happen without lots of dialogue. Both sides of the issue are going to have to figure something out. I don't think the current state of things is sustainable.

 

[DazzleT]

Maybe I am weird but I think people who make alot of money work very hard to do that. A CEO became a CEO by hard work. So the reward for being successful in the country is that we tax them more etc etc? Why should they be responsible for us? These CEO's offer many of the jobs in the country.

I just am not a fan of it. I think we live in a culture where successful people are " bad " and the ones who aren't are " good "

Millionaires and Billionaires are " bad " people. No I think they are smart people that deserve to get what they get because they earned it. I wish I was one of them

Its just a weird culture now a days...

Everyone just has to do whatever they can to get ahead in life. Easier said than done though

Do you really believe what a ceo does is a thousand times harder than what most of their employees do? In my experience, the difference between the ceo and the rest of us is that he is willing to let someone die in order to make $125 instead of $25 (actual situation that came up- it was fourth quarter and he needed the numbers higher so letting a patient die was acceptable). Most of the ceos I worked for didn’t even understand what we did.

What might help is to get rid of the quarterly reports- try to force longer term planning. In 3 months, abusing employees can make you money- over 5 years, the effects start hurting.

 

[TheMaxRebo]

I appreciate your responses. Always articulate and well thought out (probably much more so than my off the cuff mostly sarcastic ways)

I get that a mandated living wage or whatever would be very hard to implement and at the very least divisive. Your solution could work, I haven't seen the numbers on the projected affect, but it could be a start.

In my mind, we have to find a way to correct the wage growth. Let the bottom 90% grow a little quicker than what's happening at the top. That's very macro level and I understand the details are tricky at best.

Whatever the solution will be, it wont happen without lots of dialogue. Both sides of the issue are going to have to figure something out. I don't think the current state of things is sustainable.

Just wanted to say I appreciate your responses as well - I really do think the vast majority of people debating topics like this, even if coming from different directions, want what is best for the majority of people - it's just how we get there that the debate occurs

Actually I think this thread as a whole has been much more civil than your standard Facebook "conversation" or whatever tends to be - and you and others have made me think. This alone won't change/fix things but I think rational conversations are much more productive than "shouting" on social media and disparaging anyone who doesn't fully agree with you

 

[middlechild]

There already exists laws concerning CEO compensation. A company cannot deduct as a business expense any CEO salary over $1,000,000.
"Federal laws and Securities and Exchange Commission (SEC) regulations have been developed on compensation for top senior executives in the last few decades,[12] including a $1 million limit on the tax deductibility of compensation[13][14] not "performance-based", and a requirement to include the dollar value of compensation in a standardized form in annual public filings of the corporation."
https://en.wikipedia.org/wiki/Executive_compensation_in_the_United_States

While I admit Wikipedia is not the best source, there are better ones that would cite the same rules.
Look at the 10K form, we find that Bob Iger is not paid, as in a weekly pay check, but through stock grants and options giving him equity in the company.

Top echelon is not "paid" like line workers. You cannot directly compare $15 an hour to compensation based on performance. Mr Iger expands the revenue and profit of the company, so he benefits. Would CMs give up the raise if the company performs poorly? I don't think so.

 

[dlavender]

There already exists laws concerning CEO compensation. A company cannot deduct as a business expense any CEO salary over $1,000,000.
"Federal laws and Securities and Exchange Commission (SEC) regulations have been developed on compensation for top senior executives in the last few decades,[12] including a $1 million limit on the tax deductibility of compensation[13][14] not "performance-based", and a requirement to include the dollar value of compensation in a standardized form in annual public filings of the corporation."
https://en.wikipedia.org/wiki/Executive_compensation_in_the_United_States

While I admit Wikipedia is not the best source, there are better ones that would cite the same rules.
Look at the 10K form, we find that Bob Iger is not paid, as in a weekly pay check, but through stock grants and options giving him equity in the company.

Top echelon is not "paid" like line workers. You cannot directly compare $15 an hour to compensation based on performance. Mr Iger expands the revenue and profit of the company, so he benefits. Would CMs give up the raise if the company performs poorly? I don't think so.

For that amount of money, most would take that offer...

Also, how much does Disney profit if the $15 tier doesn’t show?

 

[KaptKaveman]

In my experience, the difference between the ceo and the rest of us is that he is willing to let someone die in order to make $125 instead of $25 (actual situation that came up- it was fourth quarter and he needed the numbers higher so letting a patient die was acceptable).

Kind of a big leap here......

 

[DazzleT]

Kind of a big leap here......

Have you read the pharm ceo talking about his moral imperative to price gouge?

 

[YesterDark]

Kind of a big leap here......

In case you're curious: https://www.cnn.com/2018/09/11/health/drug-price-hike-moral-requirement-bn/index.html

"A pharmaceutical company executive defended his company's recent 400% drug price increase, telling the Financial Times that his company had a "moral requirement to sell the product at the highest price."

 

[DazzleT]

Another way to view it: my former company’s ceo made 18 times what a neurosurgeon makes. The person who literally cuts into your brain, who one small oops can kill you makes an order of magnitude less than the ceo. Is a ceo’s work 18 times harder than brain surgery?

 

[Mikey15]

Top echelon is not "paid" like line workers. You cannot directly compare $15 an hour to compensation based on performance. Mr Iger expands the revenue and profit of the company, so he benefits. Would CMs give up the raise if the company performs poorly? I don't think so.

There's also no guests, revenue, or profit without CMs showing up everyday to keep the park clean, keep the rides running, and making the experience magical. As a society we seem to undervalue this work relative to compensating the guy in the office steering the ship, even though both provide value.

Executive compensation for DIS is a drop in the bucket compared to their billions (with a "b") in profit on parks and resorts each year though, of course, so I'd argue CM vs. Exec compensation as a false dilemma. The question is CM wages vs. shareholders. On the one hand, the corp is accountable to the shareholders to maximize profit, but on the other, a good corporate citizen should adequately compensate its front-line staff. Despite being an indirect shareholder myself (invested in the index as a whole) I think it's good in this case that the staff had the representation and bargaining power necessary to secure this deal. $15/hr is not a tall ask for compensation.

 

[Douglas Dubh]

That's highly debatable. Another time?

https://www.realclearmarkets.com/ar...g_financial_about_the_2008_crisis_103409.html

 

[KaptKaveman]

In case you're curious: https://www.cnn.com/2018/09/11/health/drug-price-hike-moral-requirement-bn/index.html

"A pharmaceutical company executive defended his company's recent 400% drug price increase, telling the Financial Times that his company had a "moral requirement to sell the product at the highest price."

And....... as the CEO he probably believes he is looking out for his investors/stockholders. If you don't agree with this then buy medication made by this company. Simple. If enough people feel this way the company will lose money and this guy will be out on the street. The free market in action......

It certainly is a big leap to insinuate that because one CEO did something you find objectionable that they are all scum. Do you disagree?

 

[dlavender]

https://www.realclearmarkets.com/ar...g_financial_about_the_2008_crisis_103409.html

Well if one opinion piece says so, then it must be so....Saw lots of scholarly citations....