10 ms·

Wage inequality may be starting to reverse

23 points by autokill 4y ago

autokill 4y ago
https://archive.ph/kzt4e https://archive.ph/kzt4e
rychco 4y ago
I’m incredibly happy to see wages at the bottom rising, but I think there’s a serious lack of discussion around obscenely high executive pay.
- quantified 4y ago
  Discussion can be had all year long, but the executive caste will maintain it. There's no law or peaceful incentive to change the tendency. It's important to them that the plutonomy be maintained and extended.
  - ixtli 4y ago
    I’d go further: the myth of “discussion” as some sort of tool to resolve these issues benefits them and them alone.
    - PKop 4y ago
      Carl Schmitt critiqued liberal democracy with this very same premise. The myth of the disinterested neutral "discussion" seeking consensus optimal solutions, (vs the reality of factional interest groups fighting for 0 sum spoils and power).
- slothtrop 4y ago
  Is it a result of perverse incentive? I think it would help to better understand why executive pay is so high in the first place.
  - quantified 4y ago
    Because it can be. The boards that set it are made up of executives, and it's good for all that the bar for average pay gets ratcheted up. While a good CEO may be worth a multiple of any line worker, the notion that a CEO will leave for some other pursuit only holds water if the other pursuits hold higher multiples and are readily attained. They would all work for one-quarter the comp if that is all they were offered. As it is, they'll happily work for double also.
    - zozbot234 4y ago
      CEO's have a lot of influence on the value of firms they manage, as we're surely all aware of. CEO compensation is generally about aligning interests between the CEO and the firm itself.
      - quantified 4y ago
        All comp is about aligning interests. Nothing special about CEO comp unless it's to overcome pathologies in the CEO's makeup.
  - PenguinCoder 4y ago
    Because just like congress, they can vote to give themselves raise and the amount. Can you as a typical employee guarantee yourself a wage increase, and the amount? Not hard to see your pay increase as much as you want it to, when you're actually in control of setting it and not just accepting what is given.
  - Cardinal7167 4y ago
    [dead]
- TheDudeMan 4y ago
  No issue with the pay. But the US sucks at taxing rich people.
  - xedrac 4y ago
    Not that it seems to matter. Congress will spend way more than they receive in taxes, regardless of the tax rate on rich people.
    - TheDudeMan 4y ago
      I agree that that is a problem. But it is a separate problem. If two problems depend on each other, should we fix neither because that fix won't matter in isolation?
m00dy 4y ago
I'm sure I'm not the only one not believing in this.
chiefalchemist 4y ago
> In the decades before the pandemic, the wages of lower-paid, less skilled hourly employees steadily lost ground to those of skilled workers, college graduates, managers and professionals. In the two years since, those trends have sharply reversed. We don’t know if this narrowing in inequality will last. I'm certainly for economic justice. But how is comparing apples to canned tuna "inequality"? As another comment already mentioned, wouldn't our time be better spent discussing the extreme delta between the top and everyone else? The delta between service worker and say tech is far less than the delta between that collective average and the top of the financial food chain. But here we got again. Distracted. And letting the lede tip toe out of the room.
- DoughnutHole 4y ago
  > The delta between service worker and say tech is far less than the delta between that collective average and the top of the financial food chain. True when we think purely in terms of wealth and income, but I'd say the reverse is true in terms of quality of life. A SV tech worker earning six figures has food and housing security, likely has insurance and dental, has a 401k, is possibly building wealth with stock options, likely has a long term achievable plan to buy a home if they don't own one already, has an emergency fund. They can afford to live in a safe area and send their kids to a good school. That's a lot of vital needs satisfied, many (maybe even most) of which are not fulfilled for the average minimum wage service worker. A huge number of people are one missed wage payment away from poverty. Sure, Elon Musk has a private jet and can fly anywhere he wants every day of the week. But his fundamental needs (physiological, safety, security) are basically met just as well as mine. The concentration of wealth at the very top is deeply concerning and potentially destabilising. But I think it's worth remembering the differences between the secure end of the middle class and the bottom half society.
riku_iki 4y ago
Ultra-rich usually do not receive high wages, but they pocketed around 20T(my estimation) in last 5 years through leveraged trades on inflated stocks/private equities and real estate enjoying near zero loans rates. Now they own very large chunk of American businesses and land/real estate, no need to work for wages.
pilsetnieks 4y ago
Wages or income? Two different things. Steve Jobs had a $1 salary, many notable others did, too [1]. [1] https://en.wikipedia.org/wiki/One-dollar_salary https://en.wikipedia.org/wiki/One-dollar_salary
- DoughnutHole 4y ago
  "Income" and "wage" are used interchangeably in this context - income derived from labour, ie salary, bonuses etc. That's what "income inequality" generally refers to. "Wealth inequality" is what's relevant if you're concerned about the mega-rich like Jobs. If your assets are big enough you can live off of them without any labour - through rents, dividends, sale of assets etc. It's interesting if income inequality is going down considering that wealth inequality is worsening in the developed world due to the recent massive inflation of housing assets.
  - AstralStorm 4y ago
    Easily explained, the assets became unavailable to whole chunk of population, and the relatively tiny increase of wages does barely dent the increased cost of living for them. The remaining assets are purchased by the rich who can afford them. Easiest way to present this problem would be to measure in PPP adjusted dollars the time it takes to save to purchase a basic asset (usually living space) subtracting living costs. Make sure to also consider the asset price long term trend while at it. If you cannot save, the time is infinity, if you cannot buy it in a lifetime, better also count your (ever poorer) kids in. This is only the most basic estimate, remember that over time any health issue or other catastrophe is likely to happen, and the response to these often depends the savings you have... (You can count a flat buffer or a percentage.)
acchow 4y ago
> Remote work, deglobalization, stalled technology have started eroding some advantages of higher-skilled workers Their premise is broken. The largest inequality is not between highly skilled workers and everyone else. It is between the wealthy (top 0.1% or 0.01%) and the rest.
- noyoudumbdolt 4y ago
  Not a broken premise at all. The focus on the ultra rich is mostly just a political ploy since it's easy to villainize extravagant wealth. But the vast majority of income (I'm including capital gains in this) is made by the middle class and wage-earning upper class, not by the ultra rich. If you take all the wealth of the ultra rich and distribute it evenly, every person would get a one-time, nice, but not life-changing check (somewhere between $70k and $150k). And then next year everyone is mostly back where they were before except you can't raid the ultra rich again since you just wiped them out.
  - kristopolous 4y ago
    > The focus on the ultra rich is mostly just a political ploy No, it's about the power asymmetry that breaks the promises of democracy that comes with it.
    - zozbot234 4y ago
      This is pure conspiracy thinking, it sounds just like those people who obsess over Bill Gates and George Soros. Please explain how the ultra-wealthy can be so powerful if they aren't spending down much of any wealth, and a lot of what they do spend is on charitable grants made in the public interest to 501(c)3 organizations, which must be politically neutral as a matter of law.
      - noyoudumbdolt 4y ago
        501(c)3's are some of the most political organizations out there. The only thing they can't do is be directly involved in electoral politics. But social influence and ideologically driven work, that's totally fine.
willmadden 4y ago
[flagged]
- femiagbabiaka 4y ago
  I'm not a fan of communism, but that ideology produced two of the major world powers. Entire generations of illiterate peasants were educated, entire economies were completely reconstructed in a way that is pretty much unprecedented. There was immense repression, the human cost of Stalinism for example is uncountable. But capitalism has caused immense suffering as well. It's better to simply speak plainly of the effects systems have had rather than trying to moralize away the good in order to emphasize the bad, in my opinion. Dogma makes for bad reasoning.
  - willmadden 4y ago
    [flagged]
    - pokepim 4y ago
      [dead]
    - femiagbabiaka 4y ago
      Dogma makes for good rhetoric, but it doesn't stand up to daylight. The Soviet Union advanced the technology of not just itself, but many of its vassal states such as Cuba. China has long since abandoned communism-in-practice, but it is still one of the most advanced nations in the world. If the success of those countries cannot be accounted to communism, then the success of the U.S. cannot be attributed to capitalism either.. And as far as death tolls, they're completely indefensible, that's why I am not a proponent of communism or other anti-democratic ideologies. But it is curious that the death tolls from fascism never get added to the death toll of capitalism. Each ideological wing generates human suffering at the far end of anti-democracy, which is what we need to avoid, whether it comes disguised as facism or communism, or whatever else.
      - 4y ago
tracerbulletx 4y ago
The premise of this article is absolutely disgusting. The inequality that matters isn't the difference between blue collar workers and college grads with marketing and tech jobs. This is just propaganda to destroy the middle class.
- PKop 4y ago
  Matters to you because you wouldn't be harmed by it? All egalitarian, equality doctrines will end up here, why wouldn't they? What is the limiting principle? This is why they should be rejected. Pretty funny to see the outrage when the equalizing starts moving down the spectrum. Why shouldn't that blue collar worker want you to be equalized to him, why should he care about your disgust?
  - femiagbabiaka 4y ago
    Matters because it is nonsensical. There are some cases, such as AI research contributing to automation that replaces workers from one industry with another, or perhaps more directly, Uber replacing taxi workers, where income can be envisioned to be taken from one set of workers pockets to another. But in reality, that's not how this works. Each company is distinct and has its own funding models. And the vast majority of money taken out of all workers paychecks regardless of industry isn't extracted by other workers in unrelated industries, it's removed by the employers to line their own pockets.
  - heavyset_go 4y ago
    I think you're mistaken here, blue collar workers and white collar workers are in the same boat when it comes to the precarity of their means of providing for themselves and the relations they have with the entities that dole out those means. Division is what I interpreted as what elicits disgust here, when workers of all stripes would be stronger if they instead were united. The scraps that are thrown to blue and white collar workers alike pale in comparison to the wealth disparity of those who need to work as a whole versus who they must work for.
  - esolyt 4y ago
    It doesn't matter because it's tiny. The inequality between a Google engineer and a Starbucks barista is tiny compared to the inequality between a Google engineer and Elon Musk. The article only covers the former and not the latter and therefore acts as the kind of propaganda expected by WSJ. In the author's defense, they admit they're focusing on one narrow benchmark and ignoring capital gains and dividends in this article. The article still has value. But the fact remains that the article has the word inequality in its title and completely fails to cover inequality in its actual sense, the way we understand it in a political context.
decremental 4y ago
The country is being flooded with as many low skilled workers as can be bothered to make the trek, and has been for quite a long time. This problem will never see change for the positive until the ruling class no longer benefits from cheap labor. Don't forget it was them who caused this on purpose to begin with starting in the 1960s with the Immigration and Nationality Act of 1965.
ixtli 4y ago
There are so many ways in which this article really puts on display the purpose of the WSJ it’s hard to count. The most important ones are 1) labor organization (unions) are responsible for the meager gains. That’s it. If higher wage earners (like me!) actually engaged with society and organized their trade we’d get the same gains 2) inequality is not earnestly, meaningfully defined as the difference between compensation for types of labor: it’s the difference between the equity in society held by the workers versus the owning class. this is borderline propaganda
- zozbot234 4y ago
  Labor unions also shut out marginal and marginalized workers from their own sectors, or even from the labor market as a whole. The labor income of an unemployed worker is zero.
throwawayoaky 4y ago
no reason to clutch your pearls fellow bougies, the fed will fix it
Waterluvian 4y ago
I’m skeptical of the premise of this article, but I know that I saw an A&W advertising CAD $17/hr starting wage today. Not only is that above minimum wage but they are advertising it out front. Down the street is a factory asking for electricians at $40/hr. I hope that publishing wages/salaries becomes more normal. I think it’s an equalizer.
- heavyset_go 4y ago
  I see a lot of fast food places with similar signage, but if you get up close, there's an asterisk that notes that those starting wages are for full-time employees, which they don't actually hire because they don't want to give full-time employees benefits, or for management or corporate employees.

23 points by autokill 4y ago

https://archive.ph/kzt4e https://archive.ph/kzt4e

I’m incredibly happy to see wages at the bottom rising, but I think there’s a serious lack of discussion around obscenely high executive pay.

quantified 4y ago
Discussion can be had all year long, but the executive caste will maintain it. There's no law or peaceful incentive to change the tendency. It's important to them that the plutonomy be maintained and extended.
- ixtli 4y ago
  I’d go further: the myth of “discussion” as some sort of tool to resolve these issues benefits them and them alone.
  - PKop 4y ago
    Carl Schmitt critiqued liberal democracy with this very same premise. The myth of the disinterested neutral "discussion" seeking consensus optimal solutions, (vs the reality of factional interest groups fighting for 0 sum spoils and power).
slothtrop 4y ago
Is it a result of perverse incentive? I think it would help to better understand why executive pay is so high in the first place.
- quantified 4y ago
  Because it can be. The boards that set it are made up of executives, and it's good for all that the bar for average pay gets ratcheted up. While a good CEO may be worth a multiple of any line worker, the notion that a CEO will leave for some other pursuit only holds water if the other pursuits hold higher multiples and are readily attained. They would all work for one-quarter the comp if that is all they were offered. As it is, they'll happily work for double also.
  - zozbot234 4y ago
    CEO's have a lot of influence on the value of firms they manage, as we're surely all aware of. CEO compensation is generally about aligning interests between the CEO and the firm itself.
    - quantified 4y ago
      All comp is about aligning interests. Nothing special about CEO comp unless it's to overcome pathologies in the CEO's makeup.
- PenguinCoder 4y ago
  Because just like congress, they can vote to give themselves raise and the amount. Can you as a typical employee guarantee yourself a wage increase, and the amount? Not hard to see your pay increase as much as you want it to, when you're actually in control of setting it and not just accepting what is given.
- Cardinal7167 4y ago
  [dead]
TheDudeMan 4y ago
No issue with the pay. But the US sucks at taxing rich people.
- xedrac 4y ago
  Not that it seems to matter. Congress will spend way more than they receive in taxes, regardless of the tax rate on rich people.
  - TheDudeMan 4y ago
    I agree that that is a problem. But it is a separate problem. If two problems depend on each other, should we fix neither because that fix won't matter in isolation?

m00dy 4y ago

I'm sure I'm not the only one not believing in this.

chiefalchemist 4y ago

> In the decades before the pandemic, the wages of lower-paid, less skilled hourly employees steadily lost ground to those of skilled workers, college graduates, managers and professionals. In the two years since, those trends have sharply reversed. We don’t know if this narrowing in inequality will last. I'm certainly for economic justice. But how is comparing apples to canned tuna "inequality"? As another comment already mentioned, wouldn't our time be better spent discussing the extreme delta between the top and everyone else? The delta between service worker and say tech is far less than the delta between that collective average and the top of the financial food chain. But here we got again. Distracted. And letting the lede tip toe out of the room.

DoughnutHole 4y ago
> The delta between service worker and say tech is far less than the delta between that collective average and the top of the financial food chain. True when we think purely in terms of wealth and income, but I'd say the reverse is true in terms of quality of life. A SV tech worker earning six figures has food and housing security, likely has insurance and dental, has a 401k, is possibly building wealth with stock options, likely has a long term achievable plan to buy a home if they don't own one already, has an emergency fund. They can afford to live in a safe area and send their kids to a good school. That's a lot of vital needs satisfied, many (maybe even most) of which are not fulfilled for the average minimum wage service worker. A huge number of people are one missed wage payment away from poverty. Sure, Elon Musk has a private jet and can fly anywhere he wants every day of the week. But his fundamental needs (physiological, safety, security) are basically met just as well as mine. The concentration of wealth at the very top is deeply concerning and potentially destabilising. But I think it's worth remembering the differences between the secure end of the middle class and the bottom half society.

riku_iki 4y ago

Ultra-rich usually do not receive high wages, but they pocketed around 20T(my estimation) in last 5 years through leveraged trades on inflated stocks/private equities and real estate enjoying near zero loans rates. Now they own very large chunk of American businesses and land/real estate, no need to work for wages.

pilsetnieks 4y ago

Wages or income? Two different things. Steve Jobs had a $1 salary, many notable others did, too [1]. [1] https://en.wikipedia.org/wiki/One-dollar_salary https://en.wikipedia.org/wiki/One-dollar_salary

DoughnutHole 4y ago
"Income" and "wage" are used interchangeably in this context - income derived from labour, ie salary, bonuses etc. That's what "income inequality" generally refers to. "Wealth inequality" is what's relevant if you're concerned about the mega-rich like Jobs. If your assets are big enough you can live off of them without any labour - through rents, dividends, sale of assets etc. It's interesting if income inequality is going down considering that wealth inequality is worsening in the developed world due to the recent massive inflation of housing assets.
- AstralStorm 4y ago
  Easily explained, the assets became unavailable to whole chunk of population, and the relatively tiny increase of wages does barely dent the increased cost of living for them. The remaining assets are purchased by the rich who can afford them. Easiest way to present this problem would be to measure in PPP adjusted dollars the time it takes to save to purchase a basic asset (usually living space) subtracting living costs. Make sure to also consider the asset price long term trend while at it. If you cannot save, the time is infinity, if you cannot buy it in a lifetime, better also count your (ever poorer) kids in. This is only the most basic estimate, remember that over time any health issue or other catastrophe is likely to happen, and the response to these often depends the savings you have... (You can count a flat buffer or a percentage.)

acchow 4y ago

> Remote work, deglobalization, stalled technology have started eroding some advantages of higher-skilled workers Their premise is broken. The largest inequality is not between highly skilled workers and everyone else. It is between the wealthy (top 0.1% or 0.01%) and the rest.

noyoudumbdolt 4y ago
Not a broken premise at all. The focus on the ultra rich is mostly just a political ploy since it's easy to villainize extravagant wealth. But the vast majority of income (I'm including capital gains in this) is made by the middle class and wage-earning upper class, not by the ultra rich. If you take all the wealth of the ultra rich and distribute it evenly, every person would get a one-time, nice, but not life-changing check (somewhere between $70k and $150k). And then next year everyone is mostly back where they were before except you can't raid the ultra rich again since you just wiped them out.
- kristopolous 4y ago
  > The focus on the ultra rich is mostly just a political ploy No, it's about the power asymmetry that breaks the promises of democracy that comes with it.
  - zozbot234 4y ago
    This is pure conspiracy thinking, it sounds just like those people who obsess over Bill Gates and George Soros. Please explain how the ultra-wealthy can be so powerful if they aren't spending down much of any wealth, and a lot of what they do spend is on charitable grants made in the public interest to 501(c)3 organizations, which must be politically neutral as a matter of law.
    - noyoudumbdolt 4y ago
      501(c)3's are some of the most political organizations out there. The only thing they can't do is be directly involved in electoral politics. But social influence and ideologically driven work, that's totally fine.

willmadden 4y ago

[flagged]

femiagbabiaka 4y ago
I'm not a fan of communism, but that ideology produced two of the major world powers. Entire generations of illiterate peasants were educated, entire economies were completely reconstructed in a way that is pretty much unprecedented. There was immense repression, the human cost of Stalinism for example is uncountable. But capitalism has caused immense suffering as well. It's better to simply speak plainly of the effects systems have had rather than trying to moralize away the good in order to emphasize the bad, in my opinion. Dogma makes for bad reasoning.
- willmadden 4y ago
  [flagged]
  - pokepim 4y ago
    [dead]
  - femiagbabiaka 4y ago
    Dogma makes for good rhetoric, but it doesn't stand up to daylight. The Soviet Union advanced the technology of not just itself, but many of its vassal states such as Cuba. China has long since abandoned communism-in-practice, but it is still one of the most advanced nations in the world. If the success of those countries cannot be accounted to communism, then the success of the U.S. cannot be attributed to capitalism either.. And as far as death tolls, they're completely indefensible, that's why I am not a proponent of communism or other anti-democratic ideologies. But it is curious that the death tolls from fascism never get added to the death toll of capitalism. Each ideological wing generates human suffering at the far end of anti-democracy, which is what we need to avoid, whether it comes disguised as facism or communism, or whatever else.
    - 4y ago

tracerbulletx 4y ago

The premise of this article is absolutely disgusting. The inequality that matters isn't the difference between blue collar workers and college grads with marketing and tech jobs. This is just propaganda to destroy the middle class.

PKop 4y ago
Matters to you because you wouldn't be harmed by it? All egalitarian, equality doctrines will end up here, why wouldn't they? What is the limiting principle? This is why they should be rejected. Pretty funny to see the outrage when the equalizing starts moving down the spectrum. Why shouldn't that blue collar worker want you to be equalized to him, why should he care about your disgust?
- femiagbabiaka 4y ago
  Matters because it is nonsensical. There are some cases, such as AI research contributing to automation that replaces workers from one industry with another, or perhaps more directly, Uber replacing taxi workers, where income can be envisioned to be taken from one set of workers pockets to another. But in reality, that's not how this works. Each company is distinct and has its own funding models. And the vast majority of money taken out of all workers paychecks regardless of industry isn't extracted by other workers in unrelated industries, it's removed by the employers to line their own pockets.
- heavyset_go 4y ago
  I think you're mistaken here, blue collar workers and white collar workers are in the same boat when it comes to the precarity of their means of providing for themselves and the relations they have with the entities that dole out those means. Division is what I interpreted as what elicits disgust here, when workers of all stripes would be stronger if they instead were united. The scraps that are thrown to blue and white collar workers alike pale in comparison to the wealth disparity of those who need to work as a whole versus who they must work for.
- esolyt 4y ago
  It doesn't matter because it's tiny. The inequality between a Google engineer and a Starbucks barista is tiny compared to the inequality between a Google engineer and Elon Musk. The article only covers the former and not the latter and therefore acts as the kind of propaganda expected by WSJ. In the author's defense, they admit they're focusing on one narrow benchmark and ignoring capital gains and dividends in this article. The article still has value. But the fact remains that the article has the word inequality in its title and completely fails to cover inequality in its actual sense, the way we understand it in a political context.

decremental 4y ago

The country is being flooded with as many low skilled workers as can be bothered to make the trek, and has been for quite a long time. This problem will never see change for the positive until the ruling class no longer benefits from cheap labor. Don't forget it was them who caused this on purpose to begin with starting in the 1960s with the Immigration and Nationality Act of 1965.

ixtli 4y ago

There are so many ways in which this article really puts on display the purpose of the WSJ it’s hard to count. The most important ones are 1) labor organization (unions) are responsible for the meager gains. That’s it. If higher wage earners (like me!) actually engaged with society and organized their trade we’d get the same gains 2) inequality is not earnestly, meaningfully defined as the difference between compensation for types of labor: it’s the difference between the equity in society held by the workers versus the owning class. this is borderline propaganda

zozbot234 4y ago
Labor unions also shut out marginal and marginalized workers from their own sectors, or even from the labor market as a whole. The labor income of an unemployed worker is zero.

throwawayoaky 4y ago

no reason to clutch your pearls fellow bougies, the fed will fix it

Waterluvian 4y ago

I’m skeptical of the premise of this article, but I know that I saw an A&W advertising CAD $17/hr starting wage today. Not only is that above minimum wage but they are advertising it out front. Down the street is a factory asking for electricians at $40/hr. I hope that publishing wages/salaries becomes more normal. I think it’s an equalizer.

heavyset_go 4y ago
I see a lot of fast food places with similar signage, but if you get up close, there's an asterisk that notes that those starting wages are for full-time employees, which they don't actually hire because they don't want to give full-time employees benefits, or for management or corporate employees.