How about a MAXIMUM wage?

September 02, 1996|By Dick Meister

SAN FRANCISCO -- Wider and wider grows the disparity between those who do the actual work of the world and those who presume to direct the work. Ever wider grows the gap between rich and poor, while ever louder grow demands that the gap be narrowed.

Raise the minimum wage, argue many who seek to create an economically just society.

A good, sound, sensible idea. Who could possibly live decently on the current minimum of $4.25 an hour -- or, for that matter, on $5.15 the future minimum legislated last month.

But that is only half the solution. We also need to look at the other end of the economic spectrum. In addition to setting a higher minimum wage, we need to set a maximum wage -- a level beyond which no one's earning could go.

That's not as far-fetched as you might suppose. President Franklin Roosevelt, worried about profiteering during World War II, proposed in 1942 that Congress limit incomes to $25,000 a year by taxing any earnings above that at a rate of 100 percent. Congress rejected Roosevelt's proposal, but the idea of limiting incomes is still very much with us, even in the current Congress.

Thirty representatives have signed on as co-authors of a bill by Democratic Rep. Martin Sabo of Minnesota that would in effect increase the taxes on companies whose executive pay is more than 25 times that of their lowest-paid workers.

In the Senate, Democrat Jeff Bingaman of New Mexico wants to give tax breaks to companies limiting executive compensation to less than 50 times that of the lowest paid.

Others, outside Congress, are proposing measures that would bar anyone from making more than 10 to 50 times the minimum wage. At the current rate, that would set an income limit of anywhere from $85,000 to $435,000 a year.

It will never happen, you say? But why shouldn't it?

A cool $4.06 million

Last year, the chief executive officers at the country's 500 largest companies averaged $4.06 million each in pay and other compensation -- $4.06 million! That's 197 times the pay of the average worker.

Some made even more. Robert J. Roberts, CEO of Comcast Corp., got $24.5 million. Lawrence A. Bossidy, president of Allied Signal Corp., gobbled up $30.5 million.

The executives' pay has been rising spectacularly -- as much as 525 percent a year for some -- while that of their employees has been increasing an average of merely 3 percent. What's more, the executives earned their big bucks largely by eliminating jobs and otherwise denying working people badly needed pay and benefits in order to increase company profits.

''The piggery continues on,'' says Graef Crystal, a corporate-pay expert. ''There seems to be no limit to this greed. It's amazing.''

It's all that, and more. Obscene is a word that comes to mind.

But suppose a maximum-wage law was passed. Sam Pizzigati, who wrote a book on the subject, suggests the intriguing possibility that with such a law ''the richest and most powerful people in the country would have a vested interest in raising the wages of the lowest-paid.'' That's because, whatever the formula, executive compensation would be linked with that of lesser-paid workers. The higher the workers' pay, the higher that of their bosses.

Revolutionary is one word for that. Sensible and fair are others.

Dick Meister, a free-lance columnist, has covered labor issues for more than three decades.

Pub Date: 9/02/96

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.