Unconditional income

davekc

Senior Moderator
Staff member
Fleet Owner
and a 1:12 payroll limitation to reign in those evil corporate types. Some of ours will think the unconditional income is a great idea and some will think the salary limitation is the right thing too.

Behind The Swiss Unconditional Income Initiative - Business Insider

More of a socialist plan but we are halfway there here in the US> We don't per se have income limitations, but we do have "unconditional income". We just happen to call it government assistance or welfare.
 

LDB

Veteran Expediter
Retired Expediter
Absolutely, but I can think of a few who will believe it is an excellent idea, limiting those evil CEO's incomes and guaranteeing a minimum to everyone.
 

Turtle

Administrator
Staff member
Retired Expediter
Ive Marx, professor of social policy at the University of Antwerp noted, "Much of the debate around basic income is a symbolic debate. They are in favour of having the discussion but disregard the efforts needed to make it work, such as paying for it. [Such a policy] is unworkable and merely symbolic."

It's also worth noting that Switzerland has one of the lowest unemployment rates on the planet (under 3%), the highest wealth per adult in the world and a fairly even wealth distribution, and a government that isn't in debt at all, much less trillions of dollars in debt. It is country that is half the size (15,940 square miles) of South Carolina (32,000 square miles) with a population of New Jersey. Switzerland also has a nominal GDP per capita of $79,033 (compared to $49,922 of the USA). The purchasing power parity (PPP - an estimate of all goods ans services as they would cost in the US) GDP $45,417 in Switzerland as compared to $49,922 in the US, which would indicate they make, overall, about 10% less money than people do in the US. However, they spend 38% less on healthcare, consume 43% less oil, use 35% less electricity, have 30% fewer babies, and live 2.73 years longer. Switzerland also has one of the lowest abortion rates in the world, at 6.8 per thousand women aged between 15 and 44, compared to the United Kingdom (17.5), France (15 in 2009) and the United States (16 in 2008). Teenage pregnancy is extremely rare there. Gun ownership is nearly universal yet gun violence is nearly non-existent.

Clearly, Swiss citizens are taught personal and fiscal responsibility at a young age. So while such a guaranteed income is highly unlikely to pass there, it is a place where it might work. Whereas such a notion in the US would only foster more of what we already have: personal and fiscal irresponsibility.
 

letzrockexpress

Veteran Expediter
Entrepreneurs are motivated by the appeal of unlimited income. Without it's draw there would likely be far less jobs and more poverty than currently exists. Without free enterprise, open and unfettered, we are doomed. A basic economics lesson should be required to graduate from any secondary educational institution in America. The feel good left wing wackos might pipe down a little...
 

EASYTRADER

Expert Expediter
I surprisingly am in favor of 'Payroll' limitations on publicly traded companies. Publically traded companies should be run for the benifit of the shareholders, as a person who has been an investor for years I can tell you most of them are not. Most public com0panies are run for the convenience of the board of directors. Individual shareholders have no power at all to control the actions of the board.

Widely held public companies are completly different animals than closely held private companies and should be treated as such under the law.
 

letzrockexpress

Veteran Expediter
I surprisingly am in favor of 'Payroll' limitations on publicly traded companies. Publically traded companies should be run for the benefit of the shareholders, as a person who has been an investor for years I can tell you most of them are not. Most public com0panies are run for the convenience of the board of directors. Individual shareholders have no power at all to control the actions of the board.

Widely held public companies are completly different animals than closely held private companies and should be treated as such under the law.

I can understand you wanting to maximize your investment but would you really want to limit payroll for the mere sake of limitation? Conversely, would you want to cap the possible value of your stock or the ability to earn a dividend? If a company is fortunate enough to be able to hire a CEO who takes the company to heights it might not have previously imagined, why limit his or her compensation? As long as it is based on performance I think you would be selling yourself short, not to mention possibly scaring off the best possible candidate. Such a practice could easily result in the Peter Principle destroying your investment. Case in point, JC Penny.
 

xiggi

Veteran Expediter
Owner/Operator
I surprisingly am in favor of 'Payroll' limitations on publicly traded companies. Publically traded companies should be run for the benifit of the shareholders, as a person who has been an investor for years I can tell you most of them are not. Most public com0panies are run for the convenience of the board of directors. Individual shareholders have no power at all to control the actions of the board.

Widely held public companies are completly different animals than closely held private companies and should be treated as such under the law.

There is just so much wrong with that statement. Yes some of the salaries are gross and morely wrong but the thought of limiting salaries wreaks of socialism.

Sent from my Fisher Price - ABC 123
 

LDB

Veteran Expediter
Retired Expediter
It's a tough subject. There are many CEO's who do amazing things, achieving almost unbelievable results. There are others who barely scrape by but have huge salaries and insane "golden parachutes" once they're replaced. I heard someone say once nobody should be paid more than the president of the U.S.. In theory no other job is as important, certainly not in sports and entertainment. That will never happen and probably shouldn't but it's one of many thoughts on compensation.

If these "evil" CEO's were limited to a million or two a year, what would be done with the savings? Would other employees be paid more? Would product prices be reduced to potentially increase sales? Would stockholders get larger dividends? No matter what happened it probably wouldn't suit the CEO haters.
 

letzrockexpress

Veteran Expediter
Corporations, though the Supreme Court has ruled they are "people", exist solely to turn a profit. They do no exist to turn a profit up to a point. The fact is it is the duty of the corporation to find the best CEO possible to create the best return possible for the stockholder. Throwing an arbitrary limit on something like the compensation of that CEO is a direct violation of the spirit of free enterprise. It is Command Socialism.
 

EASYTRADER

Expert Expediter
I think you guys are making an apples and orange fruit salad of this issue.

Public companies are 'public', they are owned by the PUBLIC. Hence the name PUBLIC. Because ownership is so diverse it is impossible for shareholders to properly reign in the Board. Most public company boards of directors exhist to fleece their shareholders.

Since their is no way for the 'market' to properly regulate executive pay, the governemnt should do it and CEO pay guidelines are appropriate. We already regulate employee pay and work conditions and hours ad nauseumFYI before the Supreme Court created the fiction that 'Corporations' should be treated as persons under the law. The average CEO to worker pay ratio in the US was 10 to 1. Prior to that ruling public corporations had to serve 'some public good'.

The reality of the situation is almost none of these guys are 'actually' worth what they get paid. The vast majority of public companies don't pay dividends, have little or no growth, are riddled with debt and are one bad move away from BK. Those of us who actively invest know this, the rest of you have no basis on which to even form an oppinion.

A perfect illustration of the problem is Al Gore at one time he was sitting on 20 boards getting paid millions upon millions an yet he has NO actual bussiness experience, the reason he is there is pure political payoff. There is nothing shareholders can do about it. Everydime a public company spends comes right out of the shareholders pocket.
 

letzrockexpress

Veteran Expediter
The reality of the situation is almost none of these guys are 'actually' worth what they get paid.

Who says? If they aren't worth what they are paid then who is worth what they are paid? How do you suggest we quantify that?

Those of us who actively invest know this, the rest of you have no basis on which to even form an oppinion.

Ok, well you brought it up. If "we", assuming you mean "us" being "you", have no basis to even form an opinion ( one n), who are you talking to? Do you know who here is an investor and who is not, and even if you do, what dictates who should comment and who should not?
 

Turtle

Administrator
Staff member
Retired Expediter
I think you guys are making an apples and orange fruit salad of this issue.

Public companies are 'public', they are owned by the PUBLIC. Hence the name PUBLIC.
As an investor, you should know better. A privately held company is privately held, meaning, in most cases, the company is owned by the company's founders, management and/or a group of private investors. A public company is a company that has sold a portion of itself to the some members of the public via some of its stock, meaning those who have bought some of the stock (the shareholders, NOT the general PUBLIC) have claim to part of the company's assets and profits. A public company isn't a PUBLIC company, it is merely a company where portions of the company is publicly TRADED in the form of stock. A publicly traded company isn't even remotely socialist in any form or fashion.

Because ownership is so diverse it is impossible for shareholders to properly reign in the Board. Most public company boards of directors exhist to fleece their shareholders.
That's often a sentiment from someone who has bought some underperforming stocks. With private companies, the stockholders, often the board of directors themselves, are directly involved with management decisions, and the goals of both shareholder and management are usually one in the same. It allows for long-term goals to be set and achieved. With public companies, they are under pressure to have consistent growth rates and earnings as it directly relates to its stock price performance, and it must coincide with the public disclosure of company finances in the forms of SEC filings and shareholder reports. Consistent growth rates and earnings are not necessarily consistent with long-term goals, especially since 2008 where more and more investors are looking at the month to month, or quarterly to quarterly performance and expect results in that time period. This results in the management of a public company trying to meet short-term goals rather than looking towards the future. Even the slightest hint of fleecing will cause the stock price to tank, eliminate cash flow, and likely put the business out of business.

The reality of the situation is almost none of these guys are 'actually' worth what they get paid. The vast majority of public companies don't pay dividends, have little or no growth, are riddled with debt and are one bad move away from BK. Those of us who actively invest know this, the rest of you have no basis on which to even form an oppinion.
The vast majority of public companies do, in fact, pay dividends. Those that don't (with a few notable exceptions) are generally younger companies who reinvest dividends back into growth. As soon as companies pay dividends (with a few exceptions that should but don't), their growth pretty much stops. You can't have it both ways. You want dividends, buy AIV. You want growth, buy AMZ.
 

EASYTRADER

Expert Expediter
Anyway,

The bottomline is public company shareholders have no way to effectively control a board of directors and therefore have no say in executive compensation. Leaving the board free to fleece the company, which they do.

As for the rest of the rebuttal comments they aren't worth rebutting.
 

cheri1122

Veteran Expediter
Driver
In order to provide proper context, some of the history of corporations in America is worth knowing. Suffice it to say, that back in the infancy of America, they were a very different animal than we see today:

Our Hidden History of Corporations in the United States

An excellent article that affirms many of the inconvenient truths kept behind the smokescreens of the charges of "Socialism!" and "Communism!" that appear the moment any suggestion of limiting the power of corporate money & influence is made.
Those who profess a desire to return to the intent of the Constitution [and by extension, the wisdom of the founding fathers] might have a problem reconciling this one, methinks.
It was ALWAYS about 'leveling the playing field', to prevent those with power [usually money] from taking advantage of those without - what a quaint notion, eh?
 
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