CEO cuts own nearly $1 million annual pay to $70,000. Minimum wage $33.50

[Gambit]

I remember a story back in the day of a guy buying a cigar factory in central/south america. One of the first things he did was to raise their pay. The result was they took an extra day off each week since they could make the same $$ working less.

You've got to be cognizant of cultural differences. South America is not North America. If I can be forgiven for stereotyping, I think the US is mostly comprised of hard driving, career oriented people while South America has a more quality of life oriented culture. Neither society is wrong, but cultural priorities vary tremendously.

 

[Gambit]

GREED prevents one from doing something like this.....a boundary where one must face and surpass.....it is something that makes people blind.

IMHO, it is the degree of greed that matters. You can shear a sheep many times but only skin him once right?
Something like that...

 

[Xenomorph]

One huge issue with corporations paying employees more is that prices of goods that employees purchase (also controlled by corporations) will undoubtedly rise to keep pace with the increases in income. The bottom line is your only hope is to start your own business, which is a core pillar stone that the USA was founded upon; the freedom to make as much money as you can by working for yourself. Anyone hoping to get ahead by being an 'employee' is living his life counter to everything that the USA stands for.

 

[Gambit]

One huge issue with corporations paying employees more is that prices of goods that employees purchase (also controlled by corporations) will undoubtedly rise to keep pace with the increases in income. The bottom line is your only hope is to start your own business, which is a core pillar stone that the USA was founded upon; the freedom to make as much money as you can by working for yourself. Anyone hoping to get ahead by being an 'employee' is living his life counter to everything that the USA stands for.

Whoa..easy. Nobody is attacking the American way of life. This issue isn't about capitalism vs socialism. The CEO dropped his pay while raising worker pay. He's not a fool and his salary decrease is largely symbolic. He's making a calculated gamble that raising wages will improve the bottom line. Trader Joes, Costco, and even Ford have used this strategy. Higher pay tends to attract high performers, decrease turnover and improve morale, which can affect the bottom line.
Also, Costco has proven that higher wages absolutely do not have to result in increased prices. The strategy is a win-win in many cases.

 

[Xenomorph]

Whoa..easy. Nobody is attacking the American way of life. This issue isn't about capitalism vs socialism. The CEO dropped his pay while raising worker pay. He's not a fool and his salary decrease is largely symbolic. He's making a calculated gamble that raising wages will improve the bottom line. Trader Joes, Costco, and even Ford have used this strategy. Higher pay tends to attract high performers, decrease turnover and improve morale, which can affect the bottom line.
Also, Costco has proven that higher wages absolutely do not have to result in increased prices. The strategy is a win-win in many cases.

I wasn't suggesting anyone was 'attacking the American way of life'. I was suggesting that people in the USA are not actually participating in the American way of life when they content themselves to be employees. Costco is just a single corporation.

 

[Gambit]

I wasn't suggesting anyone was 'attacking the American way of life'. And Costco is just a single corporation.

Ford employed this strategy at its inception when the Model T was introduced and it continues to be middle class focused company. If we look at tech companies, the benefits are even more apparent. How much does Google cost the consumer upfront? Twitter? Open source companies like Redhat? In many cases, large tech companies that treat their workers extraordinarily well have reduced costs to consumers, often to zero. My point is that the strategy has merit and can work in many cases.

 

[Xenomorph]

Ford employed this strategy at its inception when the Model T was introduced and it continues to be middle class focused company. If we look at tech companies, the benefits are even more apparent. How much does Google cost the consumer upfront? Twitter? Open source companies like Redhat? In many cases, large tech companies that treat their workers extraordinarily well have reduced costs to consumers, often to zero. My point is that the strategy has merit and can work in many cases.

If there was a widespread increase in pay across corporations (which is what people want) prices on all goods would simply rise to match because goods are priced at what the market can bare. The only reason raising wages 'works' in isolated instances, is because those instance are isolated. Again, people who hope to have their dreams fulfilled working for someone else are completely missing one of the main benefits of being a US citizen.

 

[Gambit]

If there was a widespread increase in pay across corporations (which is what people want) prices on all goods would simply rise to match because goods are priced at what the market can bare. The only reason raising wages 'works' in isolated instances, is because those instance are isolated. Again, people who hope to have their dreams fulfilled working for someone else are completely missing one of the main benefits of being a US citizen.

There are quite a few 'isolated cases' in corporate America. Let me take a different tack. Suppose a hospital has a bloated management structure with a CEO who is paid north of $5 million? What if that hospital cut his pay to $500,000 and hired 3 surgeons, a couple of PA-Cs, and some nurses? Open up a new operating theater and now you've got a new revenue stream. What if the hospital hired more nurses with the 4.5M? Now care can be delivered more efficiently and safely. Patient satisfaction is increased with a decrease in malpractice cases. Costs go down, profit goes up.

 

[tiddlywinks]

Again, people who hope to have their dreams fulfilled working for someone else are completely missing one of the main benefits of being a US citizen.

Traditional Capitalism: You have two cows. You sell one and buy a bull. Your herd multiplies and the economy grows. You sell them and retire on the income.

American Capitalism: You have two cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights for all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. You sell one cow to buy a new President of the United States, leaving you with nine cows. No balance sheet provided with the release. The public buys your bull.

 

[Gambit]

Traditional Capitalism: You have two cows. You sell one and buy a bull. Your herd multiplies and the economy grows. You sell them and retire on the income.

American Capitalism: You have two cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights for all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. You sell one cow to buy a new President of the United States, leaving you with nine cows. No balance sheet provided with the release. The public buys your bull.

Succinct and to the point. Thank you.