Driftwood wrote:
gbaji wrote:
Now, if they want to waste 10 million dollars paying an incompetent friend of theirs a massive salary, also ensuring that the company does less well than it would otherwise, then that's their money to waste.
So, in a way, you're saying there's nothing wrong with someone making a completely ridiculous 10 million dollars per year unless that person @#%^s everything up?
No. I'm saying that the guys who pay his salary and who stand to lose a boatload more than 10 million dollars if he screwed up should be the ones to decide if his job is worth that much money. And if he does ***** up, it's their loss and once again their decision to fire him. There's no absolute right or wrong here. It's about people's choices. Your statement is like arguing whether there's something wrong with someone paying 10,000 on a sound system for their car. Well, if they want to spend that much money on something like that, it's their choice, right? It might not be the decision you'd make, but then it's not your money.
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There is nothing wrong with making money.
You and I have different ideas of what "making money" means. I think you're missing the point of money in fact.
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The entire point of the capitalist system is to make money and maximize profit. However, no one, for any reason whatsoever, needs to be making millions of dollars per year.
No one needs to wear pink fuzzy bunny slippers. But the nature of a free society is that people get to do what they want, not what they need. I'll point out that money really serves no purpose at all if no one's allowed to have more than they "need".
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No one should be making that much money.
Why? Have you ever questioned this assumption? What you're doing is arguing that no one should have more than they need. That's quite the communist view of the world, and frankly it doesn't work well. People having more than they need is what drives economic growth and prosperity for all. If no one was allowed to earn more than they needed and build wealth for themselves, then we would all be living on farms and riding in wagons, and have an average life span about 20 years shorter than we do now. Wealth is the incentive to do things of value for others (so they'll pay for it). Take away the wealth incentive, and there's no reason for anyone to build cars, or factories, or better houses, or televisions, or computers, or any of the modern conveniences we have today.
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That's the problem with modern capitalism. It's stopped being a matter of making money and living better, and more a matter of making as much money as possible, even if it's a completely ridiculous amount that no one could possibly ever need.
And who gets to be the arbiter of need? I think that's the problem with all systems other than capitalism. Capitalism isn't perfect. It's just better than any other system we've tried.
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Even within the boundaries of capitalism, there's a such thing as "good enough". I call myself a capitalist, but that doesn't mean that I wouldn't be fine making even as little as 50k per year. 50k is more than enough to live quite comfortably unless one thinks living comfortably requires expensive everything. If a company makes tens of billions of dollars per year, they do not need to make cutbacks, they do not need to outsource. If a person makes, say, 200k per year, they do not need to start whining about paying taxes, or acting like they're poor. They're doing magnificently well as is. Why is there this huge problem with giving a little back to the consumer, and the worker, without whom, the company, and it's higher-ups, would be bust?
Here's the problem with that theory. While having everyone make $50k/year would certainly ensure that everyone had "enough" to live on, what do you think would happen to productivity? The guy doing the job that in a free market would earn him $200k/year has no reason to work that hard or efficiently. If he and the guy next to him will both make the same "living wage" regardless of the value of their efforts to their employer, then both will do the minimum work. I know it's hard to understand but people do work really hard to earn that higher than $50k/year paycheck. They become better at their job. They learn new skills. They make themselves more valuable. Take away the incentive and very few people will put forth that effort.
And this is a problem because it's the total productivity of the workforce which creates the pool of money from which we pay out the salaries in the first place. You're making the mistake of assuming we can change one thing (relative pay) without affecting anything else. You see it as a static dollar amount of compensation which could be more evenly distributed among employees. But it is because of that uneven distribution that the compensation is what it is. Take away that uneven distribution, and you take away the incentive to be more productive. That in turn affects profits, which will shrink the amount of compensation for employees (cause their combined labor is worth less than it was before). This in turn means that
everyone loses money.
I know that this is hard to wrap your mind around, but in many cases the reason why the entry level guy can get a job for $25k is because there are guys earning much more than that at the company. Instead of looking at that discrepancy and declaring it unfair to the guy only making $25k, you should be thinking that because of the incentive of higher pay, the company earns enough to have hired that new guy in the first place. And over time, as his skills and value to the company grow, his salary will grow as well. Then, one day, maybe he'll be the guy making a 6 figure salary. That's how the free market works. It's about maximizing opportunity and rewarding success with the understanding that when you do this, you make things better for everyone. When you fail to do this, you make things worse for everyone.
