bailout dead

Why would you continue to work hard if the state is going to take "part of it away from you"?

I get that caps taxes, but that's also the state taking "part of it away from you", and it's not stopping you from doing your best at what you're doing.

The same as the way CEOs of the past kept working hard even though the state took 80% of their income away. Bottom line: because it would still pay a whole lot more than jobs you need less ambition for, and probably also just because you take pride and satisfaction out of achievement. The same motivations that have driven ambitious people to success for decades.

The idea that after the top-of-the-top wages have ballooned for a decade or two into a veritable multiple of what they used to be, capping some of that amount now will suddenly take away their working drive seems just silly.

Didnt they work just as hard when those top-of-the-top wages had not ballooned to current levels yet?

Why "arbitrarily"?

And how are the current CEO rewards not arbitrary?

There's been a veritable explosion of CEO pay and bonuses etc this past decade or two. Which has stood in no relation whatsoever to actual improvement of their businesses' performance. How is that any less arbitrary?

Michael Jordan earns, what, ten, twenty, thirty times as much, in real income, as his predecessors a generation ago. How has that got anything to do with questions or criteria of worth, or what he deserves, or hard work? Does he work ten times as much as the top sportsmen twenty years ago?

Sure you can decry the disputability of any limits set by government. But you can't pretend that the naturally centrifugal forces of the market economy result in wages that are any less arbitrary.

So how is limiting that escalating disparity a question of taking away what the guy is "worth" and just "deserves"?

here's post one (after Chai's quote);
here's post two (after the second quote of JP);
and finally, at length, post three (up till JP's point 3).

But your allegation that Congress doesn't have the power to retroactively modify a contract is wholly without merit.

Congress has the power to retroactively modify contracts. If you can't pay your obligations, your creditors may force you into bankruptcy. Congress may pass laws that impair contractual obligations under its Bankruptcy Powers.

Thus, if Congress has the power to completely wipe away contractual obligations, it has the power to take less drastic steps to help a financially strapped or potentially bankrupt company avoid bankruptcy.

Through the power of the purse, Congress may offer a monetary bailout to a failing corporation and Congress may do so on the conditions that Congress establishes. Take it or leave it.

RG said: "Let's say I start a private one man business. And I reach the maximum compensation you think I should be allowed. Why should I grow my business? Why should I hire other folk, and try to innovate if nimh and cyclo decide my effort is not worth any more money?"

You can pay yourself as much as you can afford. However, if you run your business into the ground and ask for a taxpayer handout to keep your business afloat, the taxpayer has every right to refuse to provide that handout unless you tighten your own belt.

You keep bringing up examples that have nothing at all to do with what I was talking about nimh. Taxing, even at ridiculous rates, does not interfere with the right of two private citizens to make a compensation agreement. It doesn't put a limit on anyone's earnings.

It's just not the same thing in any fundamental way except that it's motivated by the same kind of classism. That doesn't make it the same beast

Debra Law wrote:

RG said: "Let's say I start a private one man business. And I reach the maximum compensation you think I should be allowed. Why should I grow my business? Why should I hire other folk, and try to innovate if nimh and cyclo decide my effort is not worth any more money?"

You can pay yourself as much as you can afford. However, if you run your business into the ground and ask for a taxpayer handout to keep your business afloat, the taxpayer has every right to refuse to provide that handout unless you tighten your own belt.

I agree 100%. But once again that's not what we are arguing about. Cyclo, and now nimh, have been arguing about the government regulating and limiting compensation in general.

The golden parachute clauses in the bailout bill are perfectly legal, I just think they are a dangerous distraction that is being used for populism in campaigning. But putting a ceiling on what anyone can earn is what I'm arguing against with them.

Why right do they have to decide on ceilings for everyone?

If the main idea is preventing these companies from going bankrupt, then the Federal government's bankruptcy powers are pointless. As I said to Cyclo, the only way to punish these guys and take away their compensation is to allow the very thing everyone is trying to avoid. It's cutting off your nose to spite your face to insist on it.

Well, the excesses of CEO pay, in which even failing CEOs of failing companies are royally rewarded, show that this mechanism is not self-correcting or self-perfecting as free market ideologues would have it. The
mechanisms in which the incomes of the very top have hurtled forward while the lower half of the income pyramid has stagnated, without any proportionality to the actual performance of those elites in improving profitability or productivity, show that the mechanism in which these inequalities are escalating is tethered as much to processes of elites promoting their own financial interests as to anything to do with economic performance.

The ceilings we are talking about are still so high, that the worker can achieve a level of sloth and luxury afterwards not known by 99% of our population. It isn't as if we are limiting people to some poorhouse. I think it's just the idea of limitation that sticks in your craw; but that's a psychological problem, not a societal problem. I do not agree that all those who seek unlimited ambition will go elsewhere. I think that this is a threat used by the rich to cow the poor into keeping their taxes down, and nothing more

looking at the list of directors - particularly large corporations - show how overlapping directorships play a large role in determining executive pay. add to that the club-memberships of CEOS and directors and it gives us a good idea why "friends" will do all to secure top pay for their buddies . [..]

one simple saying i learned early when coming to canada : "you scratch my back , i scratch your back ! ". i don't think that's a very difficult concept to understand. looking back over my own working life , it has often helped me to find a good job by " knowing someone who knew someone else " .

For those who have gotten all huffy about Pelosi's speech - a ridiculous position, and really people ought to be ashamed of themselves for falling for what was obviously Republican spin all along - I present the RNC's latest ad -

Rep. Michele Bachmann (R-Minn.) threw cold water on a key rationale House Republican leaders have been employing this afternoon to explain why they couldn’t deliver more GOP votes for the Wall Street bailout package.

At a Monday afternoon press conference, GOP leaders argued that Speaker Nancy Pelosi (D-Calif.) cost the measure a dozen Republican votes by delivering an overly partisan floor speech in support of it.

But Bachmann, speaking at a Republican Study Committee press conference, told reporters, “I want to assure you that was not the case. We are not babies who suck our thumbs. We have very principled reasons for voting no.”

Cyclo, You bring up an important point that many people fail to realize; this planet has limited resources, and the world's population cannot be sustained with "middle class" lifestyles. This world will always have the rich, the middle class, and the poor. The ratio between all three economic classes have different values, benefits, and potential depending on the countries development.

All cannot continue to expand its use of the world's resources; we're already harming our environment by the 6. billion humans. This cannot continue indefinitely while the populations increase.

cicerone imposter wrote:

Cyclo, You bring up an important point that many people fail to realize; this planet has limited resources, and the world's population cannot be sustained with "middle class" lifestyles. This world will always have the rich, the middle class, and the poor. The ratio between all three economic classes have different values, benefits, and potential depending on the countries development.

All cannot continue to expand its use of the world's resources; we're already harming our environment by the 6. billion humans. This cannot continue indefinitely while the populations increase.

This is an argument to keep people poor, so they don't use resources? I don't think the majority of the world would appreciate that take. Limiting one man's ability to use resources, on the other hand, is pretty silly... because he's probably not eating and drinking that much more than his fair share.

I think what Cyclo meant by resources is wealth. And he didn't raise an important point; he made no point at all... beyond demonstrating with his opinion that he lacks a fundamental understanding of wealth dynamics. He still seems to believe that global wealth is one big pie; and there's only so much to go around. This fundamental misunderstanding has plagued mankind for centuries... but it isn't true... has never been true, really, and is not even close to true today.

Bill, if I meant 'wealth,' I assure you, I would have written wealth. I meant resources and wrote resources. Please stop trying to change my argument into one you would like to argue against.

Cycloptichorn wrote:

Bill, if I meant 'wealth,' I assure you, I would have written wealth. I meant resources and wrote resources. Please stop trying to change my argument into one you would like to argue against.

Well that's just silly, Cyclo. Advocating salary limits because you fear he with the greater salary will use more resources is beyond absurd.

The person who starts a business, creates wealth and employs people has the right to pay himself whatever the business can afford. He will pay more tax the more he earns. And if he is interested in the long term future of his business he'll wont kill the goose that lays the golden egg.

But what we are talking about here is a bunch of spivs on Wall St and in the City who have never made anything nor employed anyone.