This post is about the Have Nots in the workplace in the Supercapitalist (Robert Reich’s term) economy.
Previously I posted about the conditions that frame the individual person’s economic condition. Those conditions can be improved substantially in Virginia by increasing capital. Lower taxes, personal and corporate, create Commonwealth Trust Accounts, reform health care (not addressed in detail), increase supply of energy, etc.
Now, what is a person, let’s call him or her – Miss Have Not, to do when there are very few opportunities to move up a notch on the economic ladder? And, the jump up several notches requires new skills, education or successful entrepreneurship. Furthermore, Miss Have Not’s employer is constantly squeezed to keep her labor costs down and to push her productivity up.
Let’s say the persons who feel trapped or left behind in this Have Not end of the normal curve – or economic ladder – are 40% of the citizens of Virginia. (I’m not including illegal aliens).
First, the personal savings posted earlier, created from existing taxes, build significant security for health care and retirement.
The next step is very hard to do. (It will likely undo many of the Republican Party credentials I’ve built over 16 years. What the hey, I was a Populist Christian the whole time – anyway. Still a Conservative)
You can find money for redistribution from corporate good works and in executive salaries. You can share profits in stock and stock options.
1. Corporate good works (the Breast Cancer ladies are going to hate this – and many others) come from the corporate bottom line. It is a zero sum game in the closed system of one business tally sheet, so corporate good works compete with wages.
Encourage corporations to stop doing good works, public service, community relations, etc. and put the money into wages. Or, tax good works heavily and put that tax money into individual Commonwealth Trust Funds for persons in the lower 40% of income.
Change the laws to tax non-profit organizations incomes as income or tax their distributions. It is capital that has avoided the ‘tax once’ rule. Recycle the tax money to the individual Commonwealth Trust Funds of the lower 40%. (I am okay with taxing my tithe to my church or taxing my church’s distributions – if it doesn’t cross the first Amendment line of establishing or prohibiting religion and I’d like to know the legal precedents back to the Roman Empire on what the ability to tax means – really)
2. Encourage corporations to share their profits in company stock, stock options, or direct profit-sharing for small business that comes directly off corporate taxes. Or if we actually have a zero corporate tax rate, then make those corporations that don’t share profits pay corporate tax – which increases their risk and reduces their competitiveness.
3. (Deep breath) I actually thought of this in the early 90s. Look at the maximum ratio of the highest paid person to the lowest paid person. Is it, or in your mind, should it be, 7:1, 10:1, 100:1 or 1000:1 or what? I call that ratio the “Greedcap”.
The rationale is this. The CEO or management, (and I am paid a management salary), reflects how much money, value-added, the persons add to profit. (I’ve made my companies far more money than they have paid me – like a professional athlete… just not as well!). Yet, at some point the increased profit of a corporation is the result of everyone’s better work. I don’t know that number empirically. But, I know it exists.
Enter labor unions or shareholders. Leverage must be brought to bear when the highest pay is over the Greedcap. Every dollar paid over the Greedcap should be split (say 50:50) with 50 cents going to a person and 50 cents going to the stock, stock options, profit sharing, health benefits or retirement fund, whatever, shared by all employees. Note, if the Government, Federal or Commonwealth, establish the Greedcap and try to regulate this it will be a screaming disaster. It falls to unions, non-union workers and shareholders and moral suasion to make this work. A key point here is that you aren’t taking capital from corporations but redistributing capital allocation within the corporation or small business. (And don’t forget anyone – medical professionals, lawyers, authors, movie stars, athletes, university presidents, non-profit management, union leaders, etc. They all make their money in a community of co-workers or employees)
Next installment…dealing with the restructured economy, or… what about Walmart?