4 ms·

- I have no idea. It could be a rise in competence - it could be a rise in the size of businesses, bringing a commensurate rise in productivity (the average wor

- I have no idea. It could be a rise in competence - it could be a rise in the size of businesses, bringing a commensurate rise in productivity (the average worker is also more productive, not sure if their salary reflects that though). Actually median salaries have been relatively flat for the same time period (in the UK and US, at least) [0]. Where do you think the wealth created by the workers' increased productivity is going, since it's clearly not going to the workers? I'm not sure that people "with skin in the game" are really the best people to ask, since their justifications are likely to be local (as in, "our competitor is offering $X so we must beat that") without much insight into wider economic conditions. 0 - http://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ http://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-...

edanm 8y ago
The standard story is that salaries have remained flat. I've seen some people claim to the contrary (e.g. Russ Roberts) but I think that's too complicated for a non-economist like me to get at the truth, so I'll just stick to the general consensus here. There are some stories that make sense to me about where the increased productivity is going - into healthcare, into more leisure time, etc. But again, I'm not at all qualified to make any judgements here. > I'm not sure that people "with skin in the game" are really the best people to ask, since their justifications are likely to be local (as in, "our competitor is offering $X so we must beat that") without much insight into wider economic conditions. Well, kind of the basis for the whole idea of capitalism is that you can trust people to make local decisions that are totally selfish to them, without having to consider wider economic conditions, and that it will end up working out for everyone. The great value of capitalism, in my opinion, is that given appropriate conditions, this is usually true. It's not true in the case of some market failures, like monopolies, etc, but it's usually true. And in this specific case, again, it's totally in the interest of the people who have money, to give less of it to executives. Sure, there are lots of reasons why it's more complicated and people don't always behave in their best interest, but are you really so sure that this is the case here? Why? Why are people choosing to fork over extra money here, and what makes you think you can improve the economy by changing that?
- lovich 8y ago
  >The standard story is that salaries have remained flat. I've seen some people claim to the contrary (e.g. Russ Roberts) but I think that's too complicated for a non-economist like me to get at the truth, so I'll just stick to the general consensus here. No need to bring up this side note if you're not going to use it as an argument or back it up then >And in this specific case, again, it's totally in the interest of the people who have money, to give less of it to executives. As another poster stated elsewhere in this thread, the observed behavior of boards and executives negotiating has not been of two independent parties. The executives are now not only socially connected but have a direct incentive to constantly increase pay for their friends, so that their friends return the favor. This is not using the shareholders money well, but just quid pro quo favors that fuck everyone outside of this in group[1]. Capitalism doesn't just work unregulated because parties quickly acquire power and then subvert the rules of capitalism to funnel even more power to themselves. We are directly observing executives of modern corporations doing this via their web of board seats and increasing each other's pay ad infinitum at the expense of shareholders, employees, and society [1]https://www.wsj.com/articles/who-wins-when-ceos-sit-on-multiple-boards-not-investors-1506418202 https://www.wsj.com/articles/who-wins-when-ceos-sit-on-multi... https://en.m.wikipedia.org/wiki/Interlocking_directorate https://en.m.wikipedia.org/wiki/Interlocking_directorate
- bambataa 8y ago
  Well, to turn that around, what makes you sure that capitalism is working correctly here? With respect, you appear very reluctant to commit to any economic observation, yet also seem confident that basic Economics 101 applies to executive remuneration without allowing for other economic considerations (capture etc). For example, see [0] for a brief discussion of how executive pay may not be an efficient market. My own view is that neoliberal economic policies have led to workers having a lower share of economic output [1], resulting in an increasing share going to shareholders [2] and executives. As you say, it's totally in the interest of the people who have the money to give less of it to their workers. You're correct that I can't absolutely "know" that to be the cause, but then I don't know what makes you so confident that there is an efficient market for executives. [0] https://mainlymacro.blogspot.com/2014/01/understanding-ever-increasing-executive.html https://mainlymacro.blogspot.com/2014/01/understanding-ever-... [1] https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... [2] https://www.macrotrends.net/1324/s-p-500-earnings-history https://www.macrotrends.net/1324/s-p-500-earnings-history

edanm 8y ago

The standard story is that salaries have remained flat. I've seen some people claim to the contrary (e.g. Russ Roberts) but I think that's too complicated for a non-economist like me to get at the truth, so I'll just stick to the general consensus here. There are some stories that make sense to me about where the increased productivity is going - into healthcare, into more leisure time, etc. But again, I'm not at all qualified to make any judgements here. > I'm not sure that people "with skin in the game" are really the best people to ask, since their justifications are likely to be local (as in, "our competitor is offering $X so we must beat that") without much insight into wider economic conditions. Well, kind of the basis for the whole idea of capitalism is that you can trust people to make local decisions that are totally selfish to them, without having to consider wider economic conditions, and that it will end up working out for everyone. The great value of capitalism, in my opinion, is that given appropriate conditions, this is usually true. It's not true in the case of some market failures, like monopolies, etc, but it's usually true. And in this specific case, again, it's totally in the interest of the people who have money, to give less of it to executives. Sure, there are lots of reasons why it's more complicated and people don't always behave in their best interest, but are you really so sure that this is the case here? Why? Why are people choosing to fork over extra money here, and what makes you think you can improve the economy by changing that?

lovich 8y ago
>The standard story is that salaries have remained flat. I've seen some people claim to the contrary (e.g. Russ Roberts) but I think that's too complicated for a non-economist like me to get at the truth, so I'll just stick to the general consensus here. No need to bring up this side note if you're not going to use it as an argument or back it up then >And in this specific case, again, it's totally in the interest of the people who have money, to give less of it to executives. As another poster stated elsewhere in this thread, the observed behavior of boards and executives negotiating has not been of two independent parties. The executives are now not only socially connected but have a direct incentive to constantly increase pay for their friends, so that their friends return the favor. This is not using the shareholders money well, but just quid pro quo favors that fuck everyone outside of this in group[1]. Capitalism doesn't just work unregulated because parties quickly acquire power and then subvert the rules of capitalism to funnel even more power to themselves. We are directly observing executives of modern corporations doing this via their web of board seats and increasing each other's pay ad infinitum at the expense of shareholders, employees, and society [1]https://www.wsj.com/articles/who-wins-when-ceos-sit-on-multiple-boards-not-investors-1506418202 https://www.wsj.com/articles/who-wins-when-ceos-sit-on-multi... https://en.m.wikipedia.org/wiki/Interlocking_directorate https://en.m.wikipedia.org/wiki/Interlocking_directorate
bambataa 8y ago
Well, to turn that around, what makes you sure that capitalism is working correctly here? With respect, you appear very reluctant to commit to any economic observation, yet also seem confident that basic Economics 101 applies to executive remuneration without allowing for other economic considerations (capture etc). For example, see [0] for a brief discussion of how executive pay may not be an efficient market. My own view is that neoliberal economic policies have led to workers having a lower share of economic output [1], resulting in an increasing share going to shareholders [2] and executives. As you say, it's totally in the interest of the people who have the money to give less of it to their workers. You're correct that I can't absolutely "know" that to be the cause, but then I don't know what makes you so confident that there is an efficient market for executives. [0] https://mainlymacro.blogspot.com/2014/01/understanding-ever-increasing-executive.html https://mainlymacro.blogspot.com/2014/01/understanding-ever-... [1] https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... [2] https://www.macrotrends.net/1324/s-p-500-earnings-history https://www.macrotrends.net/1324/s-p-500-earnings-history