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It's fairly ignorant to think it's impossible for one employee to be worth more than 12 of another. For example, I imagine Drummond (Google's CLO) provides far

by lxmorj 13y ago

It's fairly ignorant to think it's impossible for one employee to be worth more than 12 of another. For example, I imagine Drummond (Google's CLO) provides far more than 12x the value of a new hire.

fennecfoxen 13y ago
I also imagine him to be more than 12x as valuable than a janitor (and, if this is Google, a masseuse.)
wallflower 13y ago
From the stark monetary perspective, in many large partnership-based corporations (not Google) - it is all about the client money you are directly responsible for bringing in to the firm. Especially in Law. Partners in law/accounting/consulting firms are invited to partnership based on the client business they bring in. And then they have to "buy in". The ratios vary. I recall one Andersen (now Accenture) partner telling me that he brought in about $10M of business. For a Big-4 (or is it Big-3?) accounting firm, the revenue per partner was $2.66 million. [1] Law firms are notorious for PPP. [2] [1] "Total firm revenue was $22 billion and global partnership was 8,280 partners giving a revenue per partner ratio of $2.66 million." [2] http://en.wikipedia.org/wiki/List_of_law_firms_by_profits_per_partner http://en.wikipedia.org/wiki/List_of_law_firms_by_profits_pe...
rayiner 13y ago
You're making a couple of assumptions: 1) The value of employees can be measured individually. Say you've got 100 assembly line workers. What's the value of losing an assembly line worker? Almost nothing. What's the value of losing all the assembly line workers, divided by 100? Pretty big number! In the U.S. we tend to define "value generated by an employee" in terms of "marginal cost of replacing the worker" but that's arbitrary. 2) That renumeration should be tied to value generated by the individual employee.
- KaoruAoiShiho 13y ago
  2) You're saying remove the supply of part of the equation? By this logic my iphone should cost $100,000 because it generated that much value for me. Or I should've paid my accountant closer to 50k instead of the 1k I paid him because that's how much the penalties would've been.
  - rayiner 13y ago
    I'm saying that its an arbitrary choice for a society to allow companies to base compensation on supply and demand. As soon as you institute law to keep laborers from occupying factories and taking them over, everything subsequent is arbitrary and can be chosen to achieve whatever social goals you want. Supply and demand is not some law of nature. Its a phenomenon that emerges in particular legal regimes.
    - brockers 13y ago
      Supply and demand is a economic model that exists in ALL economies that have finite resources and free exchange. The only ways to overcome supply and demand in the long run (as even the law of gravity can be overcome in the short run), is to either limit free exchange by force or have access to unlimited resources.
- lxmorj 13y ago
  Assembly line workers aren't only replaceable with other identical workers though. As the marginal cost of a worker increases, so do the attractiveness of alternatives like automation. If that bill passed, it would have been very bad for the Swiss economy, as it would have driven away businesses (and therefore jobs) in droves. You simply couldn't stay in Switzerland and be competitive globally.
atmosx 13y ago
And to vote against this measure is even more ignorant since it's repercussions are utterly negative to a society. I can't spot a single positive thing out of this and please greed is NOT good. In Switzerland the avg net income[1] is about 4.000 EUR (~ 6.000 USD) which is sky-high compared to other European countries. Probably the possibility to become rich some day is what drives most of these voters to say 'no'. [1] http://en.wikipedia.org/wiki/List_of_countries_in_Europe_by_monthly_average_wage http://en.wikipedia.org/wiki/List_of_countries_in_Europe_by_...
dnautics 13y ago
especially since some new hires are worth negative amounts. If salary has anything to do with one's worth to the firm (as modern intellectual socialists often argue) then perhaps some people should pay to have the privilege of employment and training.

by lxmorj 13y ago

It's fairly ignorant to think it's impossible for one employee to be worth more than 12 of another. For example, I imagine Drummond (Google's CLO) provides far more than 12x the value of a new hire.

fennecfoxen 13y ago

I also imagine him to be more than 12x as valuable than a janitor (and, if this is Google, a masseuse.)

wallflower 13y ago

From the stark monetary perspective, in many large partnership-based corporations (not Google) - it is all about the client money you are directly responsible for bringing in to the firm. Especially in Law. Partners in law/accounting/consulting firms are invited to partnership based on the client business they bring in. And then they have to "buy in". The ratios vary. I recall one Andersen (now Accenture) partner telling me that he brought in about $10M of business. For a Big-4 (or is it Big-3?) accounting firm, the revenue per partner was $2.66 million. [1] Law firms are notorious for PPP. [2] [1] "Total firm revenue was $22 billion and global partnership was 8,280 partners giving a revenue per partner ratio of $2.66 million." [2] http://en.wikipedia.org/wiki/List_of_law_firms_by_profits_per_partner http://en.wikipedia.org/wiki/List_of_law_firms_by_profits_pe...

rayiner 13y ago

You're making a couple of assumptions: 1) The value of employees can be measured individually. Say you've got 100 assembly line workers. What's the value of losing an assembly line worker? Almost nothing. What's the value of losing all the assembly line workers, divided by 100? Pretty big number! In the U.S. we tend to define "value generated by an employee" in terms of "marginal cost of replacing the worker" but that's arbitrary. 2) That renumeration should be tied to value generated by the individual employee.

KaoruAoiShiho 13y ago
2) You're saying remove the supply of part of the equation? By this logic my iphone should cost $100,000 because it generated that much value for me. Or I should've paid my accountant closer to 50k instead of the 1k I paid him because that's how much the penalties would've been.
- rayiner 13y ago
  I'm saying that its an arbitrary choice for a society to allow companies to base compensation on supply and demand. As soon as you institute law to keep laborers from occupying factories and taking them over, everything subsequent is arbitrary and can be chosen to achieve whatever social goals you want. Supply and demand is not some law of nature. Its a phenomenon that emerges in particular legal regimes.
  - brockers 13y ago
    Supply and demand is a economic model that exists in ALL economies that have finite resources and free exchange. The only ways to overcome supply and demand in the long run (as even the law of gravity can be overcome in the short run), is to either limit free exchange by force or have access to unlimited resources.
lxmorj 13y ago
Assembly line workers aren't only replaceable with other identical workers though. As the marginal cost of a worker increases, so do the attractiveness of alternatives like automation. If that bill passed, it would have been very bad for the Swiss economy, as it would have driven away businesses (and therefore jobs) in droves. You simply couldn't stay in Switzerland and be competitive globally.

atmosx 13y ago

And to vote against this measure is even more ignorant since it's repercussions are utterly negative to a society. I can't spot a single positive thing out of this and please greed is NOT good. In Switzerland the avg net income[1] is about 4.000 EUR (~ 6.000 USD) which is sky-high compared to other European countries. Probably the possibility to become rich some day is what drives most of these voters to say 'no'. [1] http://en.wikipedia.org/wiki/List_of_countries_in_Europe_by_monthly_average_wage http://en.wikipedia.org/wiki/List_of_countries_in_Europe_by_...

dnautics 13y ago

especially since some new hires are worth negative amounts. If salary has anything to do with one's worth to the firm (as modern intellectual socialists often argue) then perhaps some people should pay to have the privilege of employment and training.