Friday, March 14, 2014

The 'paid what your worth' myth

Robert Reich as usual nails it in this piece. Corporate CEOs rationalize that their huge salaries and bonuses are earned, that they worked for it, that they're worth it. And that minimum wage employees have no skills and are thus worth their meager wage. So did that hold true for when the typical GM worker 50 years ago when they were earning $35 an hour in today's wages?

They weren't more educated or smarter than today's minimum wage earners. They were earning such wages because they were in unions. That was a time when more than a third of private industry employees were in unions. Non-union businesses had to give higher wages to compete with the union jobs. Unions raised wages for everyone. And CEO's earned about 30 times as much as the minimum wage earner because the wealth was distributed more equitably.

Now of course the situation has drastically changed. Corporation influence, i.e., buying Congress people, has reversed this trend and decimated unions so that better wages can no longer be negotiated. Hence there has been a race to the bottom gravitating toward the poverty level minimum wage. And the reverse race to the top for CEOs, now making more than 300 times their low wage workers.

Not only that, the top earners don't actually earn their profits. Wall Streets top banks are still getting subsidies that prop up their profits, subsidies not available to smaller banks. This subsidy amounts to $83 billion a year, which accounts for the top CEO pay through bonuses. Said CEOs place people on their boards who pay the CEOs. And this pay comes from their bail out subsidy. It's a scam on the system; they did not earn it by working harder or being more productive and making a better profit.

They are not worth it; they are crooks. And the government in an accessory. Whereas the workers who make the products and provide the services are worth a higher wage. They obey the laws and work hard and buy things to grow the economy. This country has really warped the American dream into a 1% plutocracy. For what it's worth.

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