Maximum wage is a great idea but too good to be true. If raising the minimum wage as some people say causes more unemployment, why don’t raises for CEO’s cause the CEO’s to become unemployed?
From the article:
“Even among those on the left willing to endorse such a rate, much of the debate (like Krugman) has simply assumed that finding the point at which total tax revenue is maximized is a decisive argument for the selfsame top tax rate. But this is too quick. Given that one of the fundamental arguments in favor of a maximum wage is for the sake of realizing the fair value of political equality, it may be the case that further reducing inequality with an even higher rate (for reasons of democratic equality) is important enough that sacrificing some total economic productivity is worth the trade-off.”
Anyone looking honestly at “the economy” and “the ecology” would quickly see that “maximizing productivity” is an idiotic goal. Krugman has a giant ecological blind spot (as do many others). This writer Colin Hickey also does not mention ecology anywhere in his analysis, just social equity. Social equity is hugely important, but there’s no equity in a collapsed ecology.
We need BOTH. We need to massively reduce overall economic production, while we massively reduce social inequity. We need to prioritize ecology, measure the impact of the economy on the ecology, and make fundamental adjustments in economic incentives, regulations, and limitations in order to MOVE FAST to reduce economic impact on the ecology.
How about provide decent housing, food and clothing, education, and medicare for all, and then have those who choose to participate in a dog-eat-dog capitalism have that option?
In such a world, those who opt out of capitalism’s meat grinder would establish pastoral communities of mutual support.
Mr. Hickey’s complex arguments for a maximum wage are unnecessary in my opinion. From the prospectives of fairness and democratic feasance, a maximum wage is a no brainer.
When this topic comes up, I sometimes ask “Why not a tax rate greater than 100%?” To emphasize that the community doesn’t want anyone to earn more then X ($2.5 million in this example), and because that is often what it amounts to.
For a literary treatment, see this by Astrid Lindgren, author of Pippi Longstocking.
What follows is a free translation of the famous publication, which was published pomperipossa in the Swedish evening tabloid Expressen on March 3, 1976.
Where does the housing, food, clothing, etc. come from, except from the work of all? Even Karl Marx and Friedrich Engels appreciated that, and the first bullet point of ‘The Communist Manifesto’ was that everyone must work. Not very different from St. Paul saying “He who doesn’t work, doesn’t eat.”
Forget “maximum wage” and focus on “Maximum wealth”. How can an apartment for 125 million dollars , it being a persons THIRD residence be justified?
People have second and third Yachts that are larger than another persons residence.
The estimated GINI of Rome just before that Empire collapsed was lower then that which exists in the USA today. In Rome the top 1 percent controlled 16 percent of the wealth. In the USA it at 40 percent. The wealth of those Ancient Romans was built by their slaves and their working class and the monies they plundered from abroad and the same true today.
Can anyone on this forum name one – just one – political party or related organization in the United States that actually addresses a maximum income?
As far as I know there are only two:
- The Socialist Party USA (directly in their platform)
- Participatory Economics (indirectly as an inherent component of worker/employee compensation)
From the Socialist Party USA Platform…
We call for a steeply graduated income tax and a steeply graduated estate tax, and a maximum income of no more than ten times the minimum.
The original (Democratic Party) Farm Bill long had price ceilings (backed up by reserve supplies that could be placed on the market during times of shortages,) to protect consumers, industry and livestock interests. Farmers strongly spported these, along with price floors and supply reduction programs, (as needed to prevent cheap prices, and originally set at “living wage” or “parity” levels). These were all reduced, (1953-1995) and ended (1996-2023) by Congress, led by Republicans, and joined by progressive Democrats since 2001. That caused a massive free market subsidy to be taken from farmers and given to agribusiness, perhaps 4 trillion dollars. Agribusiness has never showed any need for these subsidies from farmers. Recent farm bill proposals from Chellie Pingree and Earl Blumenauer, and others from the recent past (Kind-Flake, Grassley-Dorman) have contained none of this and are therefore not real reform. So there is a precedent.
I think the wealth tax is a much more difficult change to make and has some confusing issues. What if you own stock and the company has some huge success and then some huge failure a few years later. Are shares confiscated when they are high even if you never saw any benefit? Yachts are disgusting and I’d want a tax structure that beat back that industry substantially. And these huge houses drive me crazy. I’m just not sure what to do about it in the near future.
I do support the idea of a maximum wage and somewhere between 1 and 10 million should work. If people don’t want the job (e.g. running a large company) then split the job and pay every VP the same. In a maximum wage scheme, I’m fine with some sort of non personal money account so privately held businesses are still possible. You just can’t pull the money out of the business faster than x million a year. Might even mean more entrepreneurs since we wouldn’t have only the super greedy ruthless fuckers in the game - they can leave the country if they want.
I don’t care for the maximum wage income proposal suggested here since very little of the economic inequality we see comes from wage income. I think it is much more important to deal with taxes on capital gains.
The supposed purpose for a lower capital gains tax than income tax is to foster risk and generate innovation. So here are my three proposals:
Eliminate carried interest as getting capital gains rates. The idea that wall street fund managers should get a capital gains income tax rate for risking other people’s money is absurd on its face and loses the treasury between $10 and $20 billion each year.
I don’t want to encourage risk and innovation in finding new ways to extract oil out of the ground to be used to threaten the planet. But I do want to encourage risk and innovation in energy storage and making renewable energy systems more efficient. Thus I propose rating investments on a four point scale relative to its effect on global warming. The best score (climate game changer) gets a capital gains rate at 1/3 the income tax rate for the individual; the next score (climate helpful) gets a capital gains rate at 1/2 the income tax rate; the next score (climate neutral) gets a capital gains rate that is the same as the income tax rate; the worst score (climate harmful) gets a capital gains rate at 50% higher than the income tax rate for the individual.
Note in the above the “income tax rate” I refer to is the rate that would be paid if all income including capital gains was taxed. Thus, the capital gains rates would become a progressive tax rather than a flat tax as it currently stands (i.e. current law has a fixed rate for capital gains that only rich people can take advantage of - I think that aspect needs to be eliminated).
I would rather see a wealth tax and taxing unrealized capital gains at death.
Excellent. No one ever needs or earns > $150/hour, if the minimum wage is $15/hour.
When i was on the board of a local consumer co-op, we successfully passed a bylaw amendment limiting top compensation to no more than 5 times entry level compensation. A few years later, a management take-over of the board resulted in completely rewritten bylaws, getting rid of that reasonable restriction. If entry level / minimum wage is roughly $30,000/year full-time, who can’t be reasonably compensated with a $150,000/year income cap?
In my dream world the ratio would be more like 3/1, rather than 5/1 or 10/1. i wonder how many people understand that in top US corporations the average ratio is more like 300/1 or 400/1, sometimes much higher.