Should the US Copy Switzerland and Consider a 'Maximum Wage ratio'

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"John Sutter writes at CNN that as Swiss citizens vote on November 24 to consider capping executive pay at 12 times what the lowest-paid worker at a company makes in a referendum. Some say the idea of tethering top executive pay to some sort of concrete metric might stop American execs from floating further into the stratosphere. ‘Here in America, the land of unequal opportunity, the CEOs of top-500 companies make in a single day about what it takes an average “rank-and-file” worker a year to earn, according to the AFL-CIO, the federation of unions,’ writes Sutter. ‘Democracy starts to unravel if a few people become wildly, ethereally successful, while the rest of a country struggles.’ A $1 million salary worked for American CEOs from the 1930s to 1980s, says Lynn Stout. But CEO pay, including options realized that year, jumped about 875%, to $14.1 million, from 1978 to 2012, according to the Economic Policy Institute. ‘What we’ve got is basically an arms race,’ Stout says, ‘where the CEOs are competing on pay because they each want to have higher status than the others.’
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Peter Drucker, the father of business management, famously said the CEO-to-worker salary ratio should not exceed 20:1, which is what existed in the United States in 1965. Beyond that, managers will see an increase in ‘resentment and falling morale,’ said Drucker. Stout has suggested that the IRS make CEO pay a non-deductible business expense when it’s higher than 100 times the minimum wage. ‘Limiting CEO pay to 100 times the minimum wage would still allow top execs to be millionaires,’ concludes Sutter. ‘And here’s the best part: If the fat cats wanted a pay increase, maybe the best way for them to get it would be to throw political weight behind a campaign to boost the minimum wage.’"
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npr.org/blogs/parallels/2013/11/22/246678622/swiss-inequality-is-growing-would-curbing-exec-pay-matter

cnn.com/2013/11/21/opinion/sutter-swiss-executive-pay/
 
The US needs to be more interested in controlling the growth of government than in restricting the private sector, which has already shrunk significantly in recent years.
 
As soon as Switzerland’s private sector is able to lead the world in anything besides expensive watches and banks that specialize in hiding rich people’s money, they should let us know.
 
In theory, I would be in favor of some ratio, but I do not think it practical. It is hard to make people behave morally as far as money is concerned by force of law. But yes, I do think America excels as greed as much as it does lust, our two big sins.
 
I generally wouldn’t subscribe to the idea of limiting one’s earning potential.

Why can’t we dismantle NAFTA, keep our jobs at home, and impose heavy tariffs on anything manufactured outside this country? Wouldn’t that do better to bring in revenue, keep Americans employed, and raise the overall wages, while at the same time allowing for unlimited CEO salaries?
 
Tarpeian_Rock said:
As soon as Switzerland’s private sector is able to lead the world in anything besides expensive watches and banks that specialize in hiding rich people’s money, they should let us know.
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You forgot about swiss chocolate!

Actually, Switzerland has a strong private sector economy, has been the wealthiest European nation some years, has low taxes and low unemployment rate.

Switzerland has many multi-national companies. I’m only an armchair economist but I suspect that this “maximum” wage concept might stem from a fear of foreigners taking undue advantage of Swiss workers.
 
It’s a good idea. Lets see if it passes in this mostly Catholic country.

ATB
 
lerapt78 said:
I generally wouldn’t subscribe to the idea of limiting one’s earning potential.

Why can’t we dismantle NAFTA, keep our jobs at home, and impose heavy tariffs on anything manufactured outside this country? Wouldn’t that do better to bring in revenue, keep Americans employed, and raise the overall wages, while at the same time allowing for unlimited CEO salaries?
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It doesn’t limit earning potential. It controls against the disproportionate gaps we are seeing today. Much like the old labor saying a rising tide lifts all ships.
 
There needs to be some kind of limit, or else we are just going to head further down the path towards to an all out class war. People are fed up with hearing about some CEOs making 100s of millions each year, when the other 99% of us have to struggle from paycheck to paycheck and many have to take on 2-3 jobs.

Sure I think the top CEOs need to make alot of money to be rewarded for turning a company around, or making a company succeed, but some of their salaries are ridiculous!! There is only so much they can buy anyway, there are only so many cars, houses, boats can one person buy after all LOL

When I think about this topic though, I like to think of the bible verse where God says it will be tougher for a rich person to enter heaven than a camel to go thru a needle eyelet! So they may get to enjoy all their riches here, but they cant buy a ticket to heaven, literally or symbolically LOL!!
 
Actually doesn’t sound like too bad of an idea. I think Archbishop Marx came up with an idea similar to this once.

I wonder, if liberals support this then how does their idea of exceedingly high taxes on the “rich” work? I guess they’ll be forced to admit that what they really want is high taxes on everyone to create a socialist utopia.
 
you could try it but I don’t think turkeys will vote for Christmas, the best of your top CEO’s will vote with their feet and move out of the country to a job with more money.
 
CrossofChrist said:
Actually doesn’t sound like too bad of an idea. I think Archbishop Marx came up with an idea similar to this once.
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If by “Archbishop Marx” you are referring to Karl Marx, then I suggest you are mistaken. He supported a system where no one would be making twelve times as much as another, but all would receive wages equally, a one-to-one ration, not twelve-to-one.
 
Mickey_Finn said:
It doesn’t limit earning potential. It controls against the disproportionate gaps we are seeing today. Much like the old labor saying a rising tide lifts all ships.
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No, it wouldn’t. My boss and I started a second company together. He can draw a salary from both. So all you’d have to do is to spin off new companies or subsidiaries and collect salaries from each to get around it. Water always finds a way through the cracks. That’s the problem with the government trying to do what they have no business doing.

The problem is most societies look for government solutions to that which is a problem of turning from God long ago. If we were committed to the Lord as the world is called to, not only would blessings abound, but those in power would have the desire to do this sort of thing because love of God, not fear of government. We have so much backwards in the world it will take a long time to fix, if we ever even try. Until then, all people have to pay for the sins of society. If society cares so much about greed, then society shouldn’t have collectively pushed God away a long time ago. Think a country like America will prosper for long without keeping God ever present in the culture? No way, regardless of who is the President.
 
mikekle said:
There needs to be some kind of limit, or else we are just going to head further down the path towards to an all out class war. People are fed up with hearing about some CEOs making 100s of millions each year, when the other 99% of us have to struggle from paycheck to paycheck and many have to take on 2-3 jobs.

Sure I think the top CEOs need to make alot of money to be rewarded for turning a company around, or making a company succeed, but some of their salaries are ridiculous!! There is only so much they can buy anyway, there are only so many cars, houses, boats can one person buy after all LOL

When I think about this topic though, I like to think of the bible verse where God says it will be tougher for a rich person to enter heaven than a camel to go thru a needle eyelet! So they may get to enjoy all their riches here, but they cant buy a ticket to heaven, literally or symbolically LOL!!
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I suspect anyone laughing at the wealthy man’s difficulty in entering Heaven may be behind them in line… You kind of lose the moral high ground at that point.
 
HappyCatholic01 said:
No, it wouldn’t. My boss and I started a second company together. He can draw a salary from both. So all you’d have to do is to spin off new companies or subsidiaries and collect salaries from each to get around it. Water always finds a way through the cracks. That’s the problem with the government trying to do what they have no business doing.
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I thought of another work around. If the ratio of highest salary was based on the lowed employee, all a CEO would have to do is contract out workers so they would be employees of another company. In the end, I think we would see a disintegration of workers rights.
but they cant buy a ticket to heaven, literally or symbolically LOL!!
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I suspect anyone laughing at the wealthy man’s difficulty in entering Heaven may be behind them in line… You kind of lose the moral high ground at that point.
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LOL? This common internet expression is not laughing at the person, but at one’s own statement, about buying a ticket to heaven. The poster may not be laughing at someone going to Hell. In any case, I do not believe the moral high ground will ever be in favor of the CEO who worships Mammon at the expense of his employees. I refuse to believe that anyone who makes the extreme salaries that have come out in the news is a “top” CEO. Such scoundrels usually show that they have their own interest first and the company second when choices are made.

I put them right up there with healthy, able-bodied welfare recipients who just refuse to work as drains on the economy and destroyers of our country.
 
pnewton said:
I thought of another work around. If the ratio of highest salary was based on the lowed employee, all a CEO would have to do is contract out workers so they would be employees of another company. In the end, I think we would see a disintegration of workers rights.

LOL? This common internet expression is not laughing at the person, but at one’s own statement, about buying a ticket to heaven. The poster may not be laughing at someone going to Hell. In any case, I do not believe the moral high ground will ever be in favor of the CEO who worships Mammon at the expense of his employees. I refuse to believe that anyone who makes the extreme salaries that have come out in the news is a “top” CEO. Such scoundrels usually show that they have their own interest first and the company second when choices are made.

I put them right up there with healthy, able-bodied welfare recipients who just refuse to work as drains on the economy and destroyers of our country.
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I have also seen it used as a “hah, take that!” expression of glee. Who knows. Either way, I have no love for their decisions, but I am not going to rank where they sit in terms of sinfulness either. I find their behavior and those who can work but choose not to to be equally deplorable. As are a host of other sinful behaviors, especially among those to whom much is given in life. But where they rank and whether or not God’s mercy shines on them is not my concern - I just pray that the latter does happen.
 
HappyCatholic01 said:
Either way, I have no love for their decisions, but I am not going to rank where they sit in terms of sinfulness either…
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Same here. I spoke only of the economic influence and the harm to the country in my opinion.

I do not think it being judgmental to acknowledge the Jesus, who was the Truth Incarnate, spoke the truth when he said is* very* difficult for a wealthy man to get enter Heaven. When I first saw this thread, I noted it was done in the Social Justice forum. My thoughts have been from the Church’s admonitions on unrestricted capitalism, though we are definitely speaking of an area where practical opinion may vary.
 
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