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Very Hot Topic (More than 25 Replies) Wealth inequality (Read 3511 times)
freeforall
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Wealth inequality
Sep 21st, 2014 at 8:37am
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The rising discrepancy in proportional income inequality between corporate executives and their workers.  It's notoriously derided by leftists as being unacceptable and requiring government intervention.  I suspect most libertarians don't care about it, saying it's reflective of the market.  In the absence of government what do you think would happen to it?  I say it would decrease.
  

Give me my freedom for as long as I please.  All I ask of living is to have no chains on me. - Blood, Sweat & Tears
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JW
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Re: Wealth inequality
Reply #1 - Sep 21st, 2014 at 11:35am
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freeforall wrote on Sep 21st, 2014 at 8:37am:
The rising discrepancy in proportional income inequality between corporate executives and their workers. It's notoriously derided by leftists as being unacceptable and requiring government intervention. I suspect most libertarians don't care about it, saying it's reflective of the market. In the absence of government what do you think would happen to it? I say it would decrease.


Explain Minecraft.

I would observe that the gap between lowest and highest is a factor of the size of the company.  Small businesses (under 20 employees) tends to run 3-10 times.  Large corporations can go up to 30-500 times.  If you are a libertarian, and truly believe in enlightened self interest, and you own the business, then the gap should be as large as you can make it.  In a libertarian state, all businesses would work to increase the gap, because that is in the self interest of those controlling the business.
  
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freeforall
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Re: Wealth inequality
Reply #2 - Sep 21st, 2014 at 1:13pm
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Minecraft?

With no government protection of the wealthiest, the 'proletariat' won't stand for such inequality when many of them have trouble paying their bills (despite being responsible hard workers) and will frequent businesses where the executives have taken publicly verifiable oaths to limit their compensation.
  

Give me my freedom for as long as I please.  All I ask of living is to have no chains on me. - Blood, Sweat & Tears
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Alan Jones
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Re: Wealth inequality
Reply #3 - Sep 21st, 2014 at 2:08pm
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freeforall wrote on Sep 21st, 2014 at 1:13pm:
Minecraft?

With no government protection of the wealthiest, the 'proletariat' won't stand for such inequality when many of them have trouble paying their bills (despite being responsible hard workers) and will frequent businesses where the executives have taken publicly verifiable oaths to limit their compensation.

That's not true of the "proletariat" in general. It would only be true for the economically illiterate socialist drones.
  
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LibertariCAN
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Re: Wealth inequality
Reply #4 - Sep 21st, 2014 at 4:40pm
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Is wealth inequality in the macro unjust if it becomes so through just means in the micro?
  

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Jeff
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Re: Wealth inequality
Reply #5 - Sep 21st, 2014 at 6:47pm
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freeforall wrote on Sep 21st, 2014 at 8:37am:
The rising discrepancy in proportional income inequality between corporate executives and their workers.

It's just how our current economic system works. Whether you call it Mercantilism, crony capitalism, the "third way" or fascism doesn't matter.
Our government is in bed with big corporations. Didn't you know this? How could you not notice?
Expect more of the same.
  

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SkyChief
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Re: Wealth inequality
Reply #6 - Sep 22nd, 2014 at 11:36am
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JW wrote on Sep 21st, 2014 at 11:35am:
(snip) ...the gap should be as large as you can make it. In a libertarian state, all businesses would work to increase the gap, because that is in the self interest of those controlling the business.


I suspect you are being sarcastic or facetious.

Government's intervention into the business world is rarely, if ever a good thing. If a worker is ok pulling in $31k/yr ($15/hr) while the the president & CEO of the company are raking in six figures annually, well thats his choice - he probably realizes how lucky he is just to have a job.

Many corporations (and even some smaller companies) have "profit sharing" programs which promotes the attitude and performance of the employees. They tend to work better and more efficiently. No government. Just sensible business management.



  
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freeforall
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Re: Wealth inequality
Reply #7 - Sep 22nd, 2014 at 12:03pm
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In a strong economy with jobs aplenty it likely wouldn't be an issue.  When the economy is weak and workers' salaries start dropping (with little place else to go for work), the company can keep showing profits which will please the stockholders, and ultimately executive compensation will rise.  This I find unethical. 

The market is in part determined by public perception.  Thus large corporations have public relations departments.  If it gets out that corporations engage in behavior such as this that the public may disagree with, they may very well see their market share and thus profits fall. 

This may be occurring with Costco and Walmart where the former values employee compensation over stockholder dividends whereas the latter corporation values the opposite or so is my understanding.  I prefer, as do many others, to shop at Costco as a result.  Time will tell if more and more consumers will follow.
  

Give me my freedom for as long as I please.  All I ask of living is to have no chains on me. - Blood, Sweat & Tears
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Crystallas
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Re: Wealth inequality
Reply #8 - Sep 22nd, 2014 at 2:08pm
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freeforall wrote on Sep 22nd, 2014 at 12:03pm:
In a strong economy with jobs aplenty it likely wouldn't be an issue. When the economy is weak and workers' salaries start dropping (with little place else to go for work), the company can keep showing profits which will please the stockholders, and ultimately executive compensation will rise. This I find unethical.

The market is in part determined by public perception. Thus large corporations have public relations departments. If it gets out that corporations engage in behavior such as this that the public may disagree with, they may very well see their market share and thus profits fall.

This may be occurring with Costco and Walmart where the former values employee compensation over stockholder dividends whereas the latter corporation values the opposite or so is my understanding. I prefer, as do many others, to shop at Costco as a result. Time will tell if more and more consumers will follow.


The amount of jobs as a metric does not determine prosperity. The level of entry, however, does.

But this is a long Chicago School vs Austrian School argument.
  
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Jeff
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Re: Wealth inequality
Reply #9 - Sep 22nd, 2014 at 4:45pm
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freeforall wrote on Sep 22nd, 2014 at 12:03pm:
In a strong economy with jobs aplenty it likely wouldn't be an issue. When the economy is weak and workers' salaries start dropping (with little place else to go for work), the company can keep showing profits which will please the stockholders, and ultimately executive compensation will rise. This I find unethical.

There are unethical people in business, just as they are in government, though government seems to be encouraging unethical behavior both in government and in big corporations.
There are no easy solutions, but the best, proven solution, the one that creates the most wealth, and the most jobs and the biggest salaries and the highest wages is a free market economy, with the rule of law, a law of contracts, and protections of rights and property by government.
  

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