Tuesday, 8 April 2008

Pay Packet Musings

Those Socialists types have an ideal where everyone, regardless of position, is paid the same. Whether you are the cleaner or the Chief Executive, your pay packet would weigh no different in your back pocket.
Depending what side of the fence you sit upon, it is either crazy or a great idea and something that cropped up in a Q & A session with an industry bod today.
"Would you do a stressful managers job if you could get paid the same for mopping the toilets? What sort of brain-dead idiot would do that?" he sneered to one of my more politically astute students after an exchange of views over the minimum wage had edged that way.
"Yes because i would put personal ambition above money" she answered before adding mischievously, "I am guessing by your answer that your personal ambition would have you sweeping out toilets then." Que the mocking cheers and a bod sipping his water and trying and failing to find a snappy comeback.
So would everyone getting paid the same work in reality?
The most obvious allure would be that people would be attracted to the job rather than the salary so you would get workers who actually want to be in those positions rather than someone who couldn't care less but want the money. How many times have we heard people moan about there job but end it with "but the moneys good".
Another plus would be an end to the equality of someone on minimum wage working all the hours just to further line the pockets of someone else who already earns many times more.
The third obvious advantage would be those who don't want to, or are unable to, pull their weight, do the 'easier' jobs such as cleaning the toilets. Doesn't matter to the rest of us because someone will be toilet cleaning and if someone is happy to do it it takes us back to the first attraction.
Would make for a happier work force certainly and solve a few of the other equality problems Capitalism brings with it and increase employment which would increase tax revenues for the country which in turn would...hang about, i think we could be onto something here.

17 comments:

Cody Bones said...

As Milton Friedman once said "If you pay people to be poor, you just end up with a lot of poor people"

Sorry Lucy, but a number of people won't want to work, if they could get paid anyway, and I'm guessing that the line to be a Playboy photographer, or Babe Winkleman's weekend replacement would be rather long.

Lucy said...

Haven't we got people who just don't want to work now though and claim Unemployement benefit?
I would guess that the Playboy photographer would come into the 'want to do the job rather than just do it for the money' category and that was one of my bonus points of the system.

Cody Bones said...

Oh no, I not only want to be the photographer, I want ALL the benefits that come with the job, including the Money.

annie said...

NEVER spread the wealth around, Lucy.
For shame!

Anonymous said...

Lucy,

What? Did you stop smoking or something?

Q

Noah "Nog" M. said...

Does smoking do that to folks? I've never tried.

Lucy,
"The most obvious allure would be that people would be attracted to the job rather than the salary so you would get workers who actually want to be in those positions rather than someone who couldn't care less but want the money."

-I would love to have a job that I like. And this is one problem. Nobody will take any of the unpopular jobs. If pay were equal folks would tend to do whatever they could most do with their equally low wage rate. I'd take some easy job that I could bear and come home and spend my measly socialist paycheck (or lack thereof) on stuff I really wanted to do.

-And I don't want to go into treatises on the social sciences, but there would be no rational way to get the best person in the best jobs without wage prices. There couldn't be civilized society and no other society can be rationally conceived.

[hint: It's like learning how to learn. Were so built into taking everything that market prices give us, that our alternates assume the things they are supposed to replace. It is only because of market prices that smarter men become scientists or writers and less smart folks tend to clean toilets and take out the garbage. This isn't intuitive without market prices. Our minds just can't well conceive of any sort of social order without them. It isn't as much about equality as possibility.]



-And again, you take the current levels of productivity for granted under your socialist state and thus you assume the existence of capitalism in your hypothetical model of socialism. Your socialist system is therefore illogically conceived.

Q.E.D.

iMuslim said...

the problem with socialism is that although it sounds fair & just, it is not designed to work in harmony with human nature, and is thus doomed to failure when applied in a real life situation. It is an ideal scenario that would only work in an ideal world, where every member of the State was morally upright & would not abuse their position to their own advantage.

Human beings don't want equality; we like the idea of being in a position of advantage to the next person, because it grants us power. If I have something you want then I can influence you, and thereby have doubled my ability to achieve my own desires, as I have doubled my work force (you and me).

A system based on trade and taxation is much more likely to work, and doesn't require everyone to play fair to be stable- though corruption should be tackled via legislation, and active monitoring.

ZenYenta said...

At the very least we could have a system that doesn't allow for quite such obscene salaries on the high end, and maybe not quite such inadequate ones on the low end. In the US, at least, the increasing inequality is getting unmanageable.

The Fez Monkey said...

Lucy,

I think the fundamental flaw in the flat pay for everyone idea is that it is, on it's face, unequal. Some jobs simply demand more time, more responsibility, more education, and more dedication than others, and should be compensated thusly. I mean, it would be hard to argue that a teacher, who carried more responsibility etc than, say your toilet scubber, should be paid the same level. And the more you go on, the more it seems to make no sense.

That being said, there should be some limits to the level of the inequality of pay. CEOs making hundreds of times the annual salary of their employees is simply insane, and has no bearing on reality any more. But paying everyone the same wage, regardless of job, is just as insane. Besides, I don't think that was exactly the idea of socialism.

Ook ook

Anonymous said...

Zenyenta,

If one looks at the data presented on the U.S. Dept of Labor website, one will see that the percentages of people in the middle class, rich class, and poor class today are actually within 1% of what they were a far back as the data goes (they don't present data before 1981).

Now, clearly the richest person is much richer today than they were in 1980. But, that isn't surprising when you consider that inflation only affects the upper end of the scale... the lower end, zero, times the rate of inflation, is still zero.

At the US Census website one can find that almost 14% of Americans are below the poverty level. However, according to their data, the typical person "below the poverty level" lives in a 3 room home/apt with heating, A/C, full kitchen, full plumbing, washer and dryer, phone, TV, and VCR. In addition, 1/3 of the people below poverty level also have an electric diswasher and 1/10 even have an electric trash compactor (they ask some bizarre questions on the census). And, they have access to free education (caveat emptor), free hospitalization in cities (caveat emptor), and food subsidies like WIC. We take things like clothing for granted...

I submit that most people in the world wouldn't consider these conditions "poverty"... In fact, these data were pretty typical of a family in the U.S. in 1969.

Q

Noah "Nog" M. said...

-imuslim,
There are multiple avenues of impossible utopianism. In this sense, socialism is no more idealistic or impracticably just than anarcho-capitalism or monarchism. "If only everyone were good enough for my system".

-Ye,
On statistical inequality, it has also been shown that the folks in the bottom quartile in 1995 aren't in the bottom quartile now and so on. There may be a lot of "poor" people, but few stay that way for extended periods except by choice. And most people who make minimum wage are under 21. We musn't abstract numbers or people from people.

On exorbitant CEO pay, if great innovation were something that anyone could do it wouldn't be innovation. There are evil men in every field. A clerk can skim of the top and so can a CEO. But often times we don't look at these folks in perspective.
If I was "the worst player in the NBA (National Basketball Association)" I might not be all that great compared to Michael Jordan and my relative ineptness might give my team a losing season, but I'll sure as hell be better at basketball than 99.99% of humanity. It's sometimes the same with CEOs and other executives. Their ventures may fail, they may be out-competed, and they might lose their investors a lot of money; but these guys are still pros and they are often worth every penny.

Lucy said...

Not hearing much support for a flat rate of pay for everyone so far. Is doing a job you enjoy not as important as how much you are earning?
Nurses are poorly paid here as are teachers but they are two of the most important professions we have so people don't go into those professions for the money, more for actually wanting to do the job.
People are volunteering amd working for nothing all over and that can only be because they are doing something they love doing.
If the wages question is taken out of the equation of career choice then it is down to the individual
how far they want to progress and how much responsibilty they want to take on.
Personally i would still want to go as high as possible for my own ambition and pride, some people will be happy to do less and get the same wages as me but their own ambition and drive, or lack of, is their responsibilty.

Noah "Nog" M. said...

Lucy,
Forgive me for the length. This is "the short version".

-"Personally i would still want to go as high as possible for my own ambition and pride" - Lucy

Think of your least favorite, least fulfilling, most frustrating possible occupation and try to find a way that you would do it without some compensating factor (i.e. wealth).


-Steve Jobs, Norman Borlaug, and Thomas Edison might all have wanted to become preschool teachers or social workers. They, all other things equal, could be a lot happier in other vocations. But it isn't socially constructive for them to go into other work areas.

Wage inequality is society telling Norman Borlaug:
"Norman, we don't want you to do the thing that, 'all other things being equal', would be the most fulfilling to you. You would like to become a poet or a social worker, but we do not wish you to be a poet or social worker. You could even become the best social worker in the world while you might only be one of the top ten biologists. You find biology dreary and depressing but we most especially want you to save 400 million people from starvation and help provide better nutrition to billions.
If you forgo what occupation you want most in order to please us (society qua consumers) we will compensate you for your efforts and sacrifice with additional resources that you can use to fulfill many other ends. If you do not wish to alleviate the greatest sufferings of your fellow men, we will not compel you to it. but we will punish you for becoming a social worker by refusing you much of the ability to fulfill those many additional ends."

Which would you prefer, given the choice between these two states of affairs?
>1)
-Norman is less satisfied with his occupation
-Norman can now buy a yacht
-Norman is 800 times wealthier than the statistically mean income citizen
-400 million people do not starve and can now live and produce giving additional benefit to the world raising real world wealth production by 8% per given period
-2 billion people each give Norman a few dozen cents
>2)
-Norman is very satisfied with his occupation
-Norman cannot buy a yacht
-All people make the same income
-400 million people starve and cannot contribute to society and do not at an additional 8% wealth per given period
-2 billion people are a few cents, in nominal money but not necessarily real wealth, richer


Society didn't and shouldn't want Thomas Edison to help old folks at retirement homes or tutor learning-impaired students at elementary schools. Society needed Edison to spend a bunch of time studying esoteric sciences that wouldn't necessarily "help the children". Edison needed and got the social indicator necessary to inform him that the world needed him to enter the dreary field of inventive science and that the world would greatly suffer if he were to try to feed children in Africa or even if he were to try to do Norman Borlaug's job as an inventor in another field. This signal was lots of money.

And that's the beauty of it. "Society" doesn't even need to have a special appointed or elected committee go research before casting a formal ballot on what Norman Borlaug or anyone needs to do. Norman Borlaug might be a crazy fellow with outlandish ideas but he realizes that outlandish idea X will make him ten million dollars (because lots of folks like really cheap and nutritious food) and so he, in a certain sense, does it automatically.

This nearly "magical" order called liberalism or "capitalism" maximizes the fulfillment of the desires and the alleviation of the wants of the individuals in society. Even if "prices", "inequality", and "money" are all "evil", they are still the best and the only way to meaningfully organize resources, efforts, and creative powers in a civilized society.

The efficiency maximizing force of liberalism is not necessarily present in any authoritarian (forgive me for using this term interchangeably with socialism) ordering of society. It cannot be assumed that Steve Jobs would have brought about the invention of Mac OS or the modern GUI under socialism.

-The most substantive rationale given here supporting an efficient productive authoritarian, or if you prefer socialist, state (i.e. one where the state controls the means of production and/or "distribution") is an "appeal to wish".

Wishing that everyone would make "equal wages" and "hoping" that this form of "ambition" or "pride", which excludes the possibility of fulfilling additional nonoccupational ends (i.e. getting bigger Yachts), and which excludes the direct ties between personal efficiency and personal success (i.e. with 100 people you get 1/100th of the fruits of your increased labors), and which makes predatory inefficiency (i.e. being lazy, I suffer losing only 1/100th of my produce making nothing in our commune of 100) much more possible and profitable, would somehow produce as much or more than a "free market" system isn't going to make socialism work.

Without thorough theoretical scientific justification, it is not valid to assume a level (in aggregate) of wealth, production, or efficiency equal to or greater than the present one under any other social order.

Q.E.D.

Jefe said...

I work in a job that I love. I work my ass off at that job, and I earn my salary. Personal pride is a huge factor in how hard I work, but the fact that I'm compensated for that work, and compensated more than someone who doesn't work as hard as me, is my reward.

Cheezy said...

Interestingly, Cuba has just removed the limits they had hitherto put on people's salaries.

http://www.reuters.com/article/worldNews/idUSN1032792120080410

Lucy said...

How strange Cheezy, we discuss it and it happens somewhere. Right, my next post is going to be about Gordon Brown getting his melon shaped head stuck in some railings. Fingers crossed.

Cheezy said...

That one sounds less likely to happen all by itself... sounds like one of us has to evade his bodyguards long enough to do the business :)