Salary caps

Clueless

causes posters to develop an inability to understa
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How about limiting the amount any person in the world can earn to 10 times the average income of that country? I remember reading about this in a Norwegian newspaper, an Economy professor at Harvard suggested it as an effective way of solving a lot of the world's problems.

Anyone else heard of this theory?

Sounds fair to me, I mean, the super-rich won't like it, but for the common man I think this would be acceptable and fair.

Thoughts?

(I realise this would be hard to do, but let's discuss it anyway)
 
In what way would it affect the "common man"?

And what do you think would happen to productivity, ambitions and invention?
 
CnutOfAllCnuts said:
In what way would it affect the "common man"?

The government would have more money to spend on its citizens.

And what do you think would happen to productivity, ambitions and invention?
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There is still an incentive. I believe that when you're earning £5 - £10 million a year it's more about the status than providing for yourself and your family anyway.
 
Clueless said:
How about limiting the amount any person in the world can earn to 10 times the average income of that country? I remember reading about this in a Norwegian newspaper, an Economy professor at Harvard suggested it as an effective way of solving a lot of the world's problems.

Anyone else heard of this theory?

Sounds fair to me, I mean, the super-rich won't like it, but for the common man I think this would be acceptable and fair.

Thoughts?

(I realise this would be hard to do, but let's discuss it anyway)
Click to expand...

:lol::lol::lol::lol:

Thats completely stupid and impossible!
 
If people have the ability, the sky should be their limit.
 
nickm said:
If people have the ability, the sky should be their limit.
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I am not a socialist by any means but I can not get my head around the ridiculous salaries movie stars or top sports mean earn. Surely a surgeon's skill is more difficult to acquire than acting.
 
Clueless said:
There is still an incentive. I believe that when you're earning £5 - £10 million a year it's more about the status than providing for yourself and your family anyway.
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:confused: How would the government have more to sue on its citizens if you capped the salary a person could earn? :confused:
 
crappycraperson said:
I am not a socialist by any means but I can not get my head around the ridiculous salaries movie stars or top sports mean earn. Surely a surgeon's skill is more difficult to acquire than acting.
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A good surgeon earns millions as well.
 
crappycraperson said:
I am not a socialist by any means but I can not get my head around the ridiculous salaries movie stars or top sports mean earn. Surely a surgeon's skill is more difficult to acquire than acting.
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Not all surgeons are equal in ability, training or skill either.
 
Clueless said:
Errr... Beats me. :) Can't anyone find that Harvard professor's article?
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Productivity would drop.

And when productivity drops, taxes apid to the government drops.

I work for one of Norway's richest men.

What incentive would he have to push himself and his companies further if he wasn't allowed to earn money from it?
 
Clueless said:
Never heard of him.

Of course celebrity surgeons gets paid lots of money, as do celebrity chefs, and other celebrities.
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He his the knee specialist in America all the footballers go to when their knees are fecked.

Fact is, if you are exceptionally good at something, and also have the drive and the ability to commercialise what you are good at, you will be earning exceptional money.

And I see absolutely nothing wrong with it.
 
CnutOfAllCnuts said:
Productivity would drop.

And when productivity drops, taxes apid to the government drops.

I work for one of Norway's richest men.

What incentive would he have to push himself and his companies further if he wasn't allowed to earn money from it?
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Is progress always positive?
 
Also, lots of gazillionaires are gazillionaires through ownership rather than earnings. What's to stop them paying themselves £1 a year then being paid in shares?
 
CnutOfAllCnuts said:
He his the knee specialist in America all the footballers go to when their knees are fecked.

Fact is, if you are exceptionally good at something, and also have the drive and the ability to commercialise what you are good at, you will be earning exceptional money.

And I see absolutely nothing wrong with it.
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Very well, I guess you're right.
 
Clueless said:
Why is it stupid?
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....Because some people desire more. This would be like world slavery where would the rest of the money go, yeah probably to corrupt government officials this would solve nothing. The Western and even now the Eastern Hemisphere run on capitalism, and I dont think that is gonna change in the near future.
 
nickm said:
Also, lots of gazillionaires are gazillionaires through ownership rather than earnings. What's to stop them paying themselves £1 a year then being paid in shares?
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Well, I guess you would have to limit that too.
 
Clueless said:
How about limiting the amount any person in the world can earn to 10 times the average income of that country? I remember reading about this in a Norwegian newspaper, an Economy professor at Harvard suggested it as an effective way of solving a lot of the world's problems.

Anyone else heard of this theory?

Sounds fair to me, I mean, the super-rich won't like it, but for the common man I think this would be acceptable and fair.

Thoughts?

(I realise this would be hard to do, but let's discuss it anyway)
Click to expand...

Not practical. In China and India, say, the average urban salary is close (say 2 or 3 times away) to 10 times the average salary of the country, because they have large, poor rural populations. This kind of cap would stop their standard of living from increasing.

Also, the end result of such a policy would be for rich (and capable) people to band together in their own country, create most of the world's wealth, and leave everyone else poor.

Which Harvard professor is this? Jeffrey Sachs? He's terrible at this kind of macro labour market stuff.
 
CnutOfAllCnuts said:
He his the knee specialist in America all the footballers go to when their knees are fecked.

Fact is, if you are exceptionally good at something, and also have the drive and the ability to commercialise what you are good at, you will be earning exceptional money.

And I see absolutely nothing wrong with it.
Click to expand...

Good one cnuts. Dick Steadman is also the reason Kobe Bryant was in Eagle, Colorado on the 4th of July and 'raped' someone in 2004. You bring up a good point if the rewards werent their would Steadman have pushed himself to invent knew techniques such as microfracture surgery probably not, would poor as hell Crisitano Ronaldo been as driven to play football to escape poverty you never know.
 
spinoza said:
Which Harvard professor is this? Jeffrey Sachs? He's terrible at this kind of macro labour market stuff.
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Don't remember, read about it in a Norwegian newspaper.

Anyway, what would you guys propose to do to solve the problem of rich vs. poor?
 
Clueless said:
Anyway, what would you guys propose to do to solve the problem of rich vs. poor?
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There will ALWAYS be a poor and rich people.

The ways to decrease the differences is a more fair distribution of wealth and resources, through taxes and help and assistant to poor people to empower and devlope themselves.
 
Do stuff like this and people move countries and/or find ways around the system.
 
Clueless said:
How about limiting the amount any person in the world can earn to 10 times the average income of that country? I remember reading about this in a Norwegian newspaper, an Economy professor at Harvard suggested it as an effective way of solving a lot of the world's problems.

Anyone else heard of this theory?

Sounds fair to me, I mean, the super-rich won't like it, but for the common man I think this would be acceptable and fair.

Thoughts?

(I realise this would be hard to do, but let's discuss it anyway)
Click to expand...
The whole thing is pea-brained anyway. As a government you want to achieve a reasonable level of inequality (there are more scientific ways of measuring this compared to just multiples of average salary) while maintaining a decent level of growth and wealth. There's no point in having everyone equally poor. Or being caught up by faster growing countries - people are jealous creatures.

If you state the problem in that way, the solution is obvious - you create an environment that incentivises people for creating economic growth and wealth, while making transfers to poorer people such that inequality doesn't grow too high. These transfers will be funded by a levy on wealth creation (tax, in other words). Surprise surprise - this is what happens now.

Inequality is a signal that your tax system is inefficient, not that you're growing too fast.
 
spinoza said:
The whole thing is pea-brained anyway. As a government you want to achieve a reasonable level of inequality (there are more scientific ways of measuring this compared to just multiples of average salary) while maintaining a decent level of growth and wealth. There's no point in having everyone equally poor. Or being caught up by faster growing countries - people are jealous creatures.

If you state the problem in that way, the solution is obvious - you create an environment that incentivises people for creating economic growth and wealth, while making transfers to poorer people such that inequality doesn't grow too high. These transfers will be funded by a levy on wealth creation (tax, in other words). Surprise surprise - this is what happens now.

Inequality is a signal that your tax system is inefficient, not that you're growing too fast.
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So you're for higher taxes for the rich then?
 
spinoza said:
Inequality is a signal that your tax system is inefficient, not that you're growing too fast.
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Not only a tax inefficiency, but also a question of how the resources are allocated.

E.g. who sits on the natural resources, or even better, who benefits from them. In countries like Brazil and Russia, with massive natural resources, the people don't really benefit from it, as they are owned privately. In Norway, and to a lesser degree UK, large parts of the natural resources are held by the state, and hence the wealth created by these resources can be divided out to the people and to the people's benefit.
 
CnutOfAllCnuts said:
Not only a tax inefficiency, but also a question of how the resources are allocated.

E.g. who sits on the natural resources, or even better, who benefits from them. In countries like Brazil and Russia, with massive natural resources, the people don't really benefit from it, as they are owned privately. In Norway, and to a lesser degree UK, large parts of the natural resources are held by the state, and hence the wealth created by these resources can be divided out to the people and to the people's benefit.
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Good point.
 
Clueless said:
So you're for higher taxes for the rich then?
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No. That's simplistic. Rich people are rich for different reasons - they could have inherited their money, they may get paid shitloads, or they may be entrepreneurs. You want to tax income higher than capital gains (mostly), but this kind of calculation depends on your nation's tax system. In the UK I think they should raise the rate of CGT 2-5%, but that's it. The rest of the government's financial problems need to be solved by better efficiency, sacking 40% of civil servants, and becoming results oriented rather than targets oriented.
 
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