Where's the Outrage?

My question is why is it bad for you if your neighbor begins to make more money?

Covetousness and envy are very bad things however.

Almost needs no explanation. Almost but not quite.

The change is shown in dollars rather than percent, so the significance of the disparity is exaggerated. May not seem like a big deal, but it would be a better gauge if the sole purpose is not to stoke envy.

Second, it would help to show it after-tax, since the top 1% pays a higher percentage of their gross, and some on the bottom receive tax credits that should count as income on the graph.

Third, no information is provided for what value that top 1% is adding. Sports stars are providing raw market value–packing stadiums, selling beer and popcorn, increasing people's pleasure with life, selling shoes, shirts….. Their probably a bargain at 7 figures. Is their evidence to show corporate execs aren't adding value comparable to what they're being compensated? If so, what's messing with the free market, that hates paying more than what it's worth?

If we could add to the graph the value of the goods/entertainment/services purchased by the bottom 60%, that were made possible by the top1%, it might show even less disparity. After all, they do choose to buy the stuff that makes them rich–must be worth something to them.

if you go to the original article he has graphed out the data in multiple ways so that folks like you wouldn't go that's exaggerated.

http://modeledbehavior.files.wordpress.com/2010…

Really? I just finished reading your comment. Really?? Value added? So you going to say that working in an assembly line doesn't have the same value as the CEO? Everyone who works adds value.

Sports stars make up a tiny faction of millionaires so let's pick on the corporate execs who make up the bulk.

I'm sorry, I'm still back at value. I'm numb.

When the 'rich executive' gets a bonus, what do you think he does with it?

He might spend it, thus providing employment for those whose goods and services he purchases.

He might save it, providing capital that banks will use to make loans available for cars and homes.

He might invest it, boosting the value of companies in which he invests, providing them with stability and the capital needed to expand , i.e. creating new jobs at that company and purchasing things which also provides jobs at the companies from whom they do business.

Do you think that 'rich executives' simply stick their money in a mattress?

Good grief.

————————————————-

The reason the executive got a bonus was probably because he increased his value to the company, according to the judgement of his employer (and that's the only person whose judgement matters because it's his money to spend.)

The reason your neighbor might not get a raise is that they may not have increased their value in the eyes of their employer, but simply 'expected a raise because they stuck it out one more year.'

When you purchase something, you aren't likely to agree to an increase in price unless a) you have no choice, you must buy it no matter the cost, or b) the more expensive version also comes with added benefit, functionality or usefulness.

When an employer purchases labor from an employee, he isnt likely to agree to pay an increased cost (wage) unless a) there is added functionality (the employee has made his service to the company more valuable) or b) he must purchase labor from the individual no matter the cost (there is no one else available/qualified to do the job).

It sounds to me as if you've never run a business and really don't understand what it takes to run one.

Value=What people (the market) are willing to pay. There is no absolute scale tied to the nobility of the workers efforts or how something contributes to the overall well-being of society. Gold, a house, a pair of underware, are all worth precisely what people are willing to pay for them in pure economic terms.

It all depends on how rare that something is and how bad people want it. If every other person had the managerial talent to run major corporation, they wouldn't be paid what they are. Many more people have the skill needed to work on an assembly line, so there's a lot more assembly workers competing with each other for jobs, undercutting each other's labor price. They all do add value, assuming they're not just dead weight, which exists at all levels of a corporation. It's just that some of what people add is much harder to come by than others, so the different competing companies compete for it, bidding up the price. I'm sure there are some evil conspiracies, which we need to identify and stop, but mostly it's just the market getting what it wants and needs.