$hare Dat Money


Social problems are abundant in the world today. From civil wars, to immigration, to racism there are a wide variety out there. However, the biggest problem in my opinion is the income inequality throughout the world. I don’t know any exact stats but I know that the top 1% of the worlds richest people own roughly 50% of the worlds money. This is a problem, being someone who grew up without any real financial concerns I never saw how exactly it effected the world. Once I got to Bucknell I realized that compared to some of the people here, what I grew up with wasn’t a lot of money. Now the kids here didn’t do anything wrong and I am not judging anyone by any means. I am simply implying that this is a problem that neither I nor many people at Bucknell have experience with.

The income gap is something that is bound to happen when there is a financial system like capitalism set up, similar to most of the world. The only places this gap didn’t happen were communist countries and those were so taboo at the time that nobody took the time to see if there were any positives to a communist system. I know writing this would have gotten me sent to prison about 50 years ago but hopefully I won’t get arrested anytime soon for it.  Is there any non-governmental solution to this income gap problem? Or is it just the system that we have implemented for years? I don’t know that a problem as large as the income gap could be solved by businesses but here is my shot at it.

In order to fix this ever widening gap, the higher ups need to be paid less and the rest need to be paid more. It has to be a significant amount as well. As communist as this proposal sounds I still believe there should be a difference between the CEO and the cashier. I believe that good competition, either inside the company or out, will improve any business. I think that these CEO’s get paid excessive amounts of money. Convincing these CEO’s to give up their paycheck for the greater good of the world is a completely different story. Whoever would propose this idea would also be strongly considered a socialist and probably get the idea shot down before they could even get in the door, but other than that minor problem I think it would work great. I don’t know that this is what it takes to fix a problem that is as large as the income gap but it would definitely be a start.

 

Photo cred: Dave Granlund

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7 thoughts on “$hare Dat Money

  1. How do you incentivize a CEO to give up his paycheck? There are certainly political mechanisms which exacerbate the income gap and many times social mobility is hard to achieve. But at the end of the day, it often boils down to an individual’s motivation and work ethic, regardless of the resources available to them. This opportunity to rise up through personal dedication and achievement in the essence of capitalism and America. Anyone can rise up if they work hard enough to achieve this.

    Im not arguing that capitalism is perfect, but communism has never succeeded (in some senses, we’ve never really seen true communism as it often gets mixed in with authoritarianism). Socialism sounds great…it seems to be working pretty well in Sweden, France, and other European countries. But these are tiny homogeneous nations; this system simply would not work in the U.S. Furthermore, I am of the belief that communism stifles innovation and creativity. If the government is handing everything out to you, what reason to you have to create and invent new things. Raising the minimum wage to amounts as high as $15 would have similar effects. If it frustrates you that your CEO is making so much more money than you, than you should be motivated to work harder and one day become the CEO.

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    1. I definitely do not disagree with you. You make some great points and I don’t think that communism would work either. I also believe that competition and motivation are very key to the advancement of society. There are a lot of problems created for a lot of people with the solution that I posed, that is what makes this problem so difficult. I don’t know that there is a solution for it, poor people will be poor and rich people will be rich forever. If I could fix this problem without creating a communist society then I would be a millionaire already.

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  2. There is certainly a big gap between the ideas that we would love to implement that would fix these problems, and actually implementing those ideas. But I certainly agree with you in that there should be a bigger balance between pay, if we can find a way to do it efficiently across the board. All I can say for now is that, possibly through social entrepreneurship, we can get some of these wealthiest people in the country to contribute some of their earnings towards something productive outside of their realm of expertise. This may seem like simple donations, but a company dedicated towards social entrepreneurship may be able to take it a step further and effectively help those who need it most.

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    1. Social entrepreneurship is a great idea. If there is a way to convince these CEO’s to invest in these good causes that don’t effect them then it escapes me. Maybe it is just my opinion and my experience with the media but the CEO’s that I hear about it are all corrupt and only focusing on themselves. To a certain extent you almost need these attributes to become a CEO. Overall I agree with you, that there is a problem that needs to be fixed somehow.

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  3. One of the biggest issue with the income disparity in this country is that wealthy people are able to increase their wealth at astounding rates by having financial advisors. This is something that is not available to the normal person and can allow the 1%er increase their wealth while still spending large amounts of money. Furthermore, when they invest in hedge funds, they can earn return up to 25% or more if they pick an extremely successful one. I may agree with the fact that CEO’s should be paid less, but many people that are millionaires in this country started their own businesses or had the money passed down to them. Growing up in the Bay Area, I knew many people that ran hedge funds, venture capital funds, or started their own businesses. They were able to become successful because they worked harder and more efficiently than their competitors. I am not saying that they “deserve” their annual salary. I do agree that their should be some way to incentivize giving, but unless you want to increase income tax or capital gains, times will not change any time soon.

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  4. I think much of whats being said here is exactly what Milton was alluding to when he suggested stakeholder theory was essentially socialism. Why should CEOs be forced to give away their paycheck for social causes? Why cant they create profit for themselves and a benefit to society? I hate to keep repeating myself in comments, but this preconceived notion that a benefit to a social cause is a reduction in profits isnt always true. We shouldnt be looking at rich, old CEOs to give away their money to help alleviate poverty, but rather changes to the system which encourage social entrepreneurship and the underprivileged to rise up. Ill admit rich CEOs can help mobilize this transformation, but i think in many cases they are being over-demonized as greedy, selfish, and sociopathic in attempts to discredit their accomplishments as harms to other stakeholder groups. This kind of finger pointing does nothing to solve the issues at hand.

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  5. I believe there are some excellent points being brought up in this conversation. I would agree that communism does not work, socialism is not customized for the U.S, and capitalism has many negative consequences. I also think that the idea that we have of capitalism comes from the people who have laid the grounds of it and the mentality associated with it. These people are the generations that come before us. Each generation has an impact, so would’t the ideal be to create a kind of culture in our generation in which we realize that materialism and distorted amounts of money are not the way to live, but only a mentality that previous generations have laid on us. I think that our generation just like any other has the power to change this mentality and create one in which to be able to make people’s lives better is enough of a reward even though it is accompanied by lower wages that we are used to.

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