“We can either have democracy in this country or we can have great wealth concentrated in the hands of a few, but we can’t have both.”
U.S. SUPREME COURT JUSTICE (1856-1941)
This is from last week, but we didn’t have a chance to get to it.
The chief executives of America’s top 350 companies earned 312 times more than their workers on average last year, according to a new report published Thursday by the Economic Policy Institute.
The rise came after the bosses of America’s largest companies got an average pay rise of 17.6% in 2017, taking home an average of $18.9m in compensation while their employees’ wages stalled, rising just 0.3% over the year.
The pay gap has risen dramatically, with some fluctuations, since the 1990s. In 1965 the ratio of CEO to worker pay was 20 to one; that figure had risen to 58 to one by in 1989 and peaked in 2000 when CEOs earned 344 times the wage of their average worker.
It’s hard to look at these numbers and not see a country in rotting decline. No one thinks everything was rosy in 1965; in many, many ways, things are so much better now. But when unions were strong, and corporations felt at least somewhat beholden to their communities, if just because they were bound by regulations and self-interest, there was a much broader sense of fairness.
That this fairness was driven by self-interest doesn’t make it less fair. Workers fought hard to push back against the bloody excesses of the gilded age, fought hard and in many cases literally died so that they could have a seat at the table. They threatened to shut down productivity and it worked, because bosses knew that if there were no workers, there was no money to be made (and not incidentally, it meant that the title of “boss” would disappear).
Partly created by the effort of those workers was the idea that the economy prospered when everyone had a chance to take part in it. That seems like a really simple idea, and indeed even a fascist like Ford recognized that things were better off if his workers could afford a Ford. That’s not to say he was benevolent or progressive or indeed even particularly good to his workers. He just knew that a certain sense of fairness kept the economy rolling and prevented revolution.