Friday, September 20, 2013

More Bad News for Low Wage Workers

Soon American companies will have to disclose how their chief executive's paycheck compares with that of their average worker under a proposal unveiled by the SEC, reports The Guardian.

The proposal is one of two major outstanding regulations mandated by the 2010 Dodd-Frank Wall Street reform law.

In this politically charged atmosphere, where interventionists abound, if I am the CEO of a publicly traded company, I am going to do every thing I can to keep the ratio, between what I earn and my workers, as close as possible.

This may mean shutting down operations that include many low wage workers. It may also mean automating jobs now performed by low wage workers. Low wage workers will become pariahs to be avoided  at all costs by publicly traded companies. With less demand for low wage workers, their wages will decline.

Welcome to the world of the unintended consequences of mad government intervention.


  1. More likely scenario is CEOs take a pay cut and stop ripping off shareholders.

    1. No, that is 100% not the more likely scenario

    2. LOL! CEOs take a pay cut? What planet do you live on?

  2. Reminds me of the opening of the song "Shadow Days" by John Mayer:

    Did you know that you could be wrong
    And swear you're right
    Some people been known to do it
    All their lives

  3. Companies will have a strong incentive to seek alternative means of compensation. Sorry CEO we can't give you a raise this year, but here's a company-owned Rolls Royce for you to use. Here, we bought a mansion for you to live in. Its very easy to reduce compensation on paper, while actually increasing overall compensation through perks, benefits, etc.