Only Joe Biden Could Pull Off A Corporate Salary Cap

As much as I love Bernie and Elizabeth, they could never get away with anything like this.  Their proposals would crash and burn on the runway before they even got off the ground.  And Obama?  Forget it.  Those quaint little Tea-Party rallies that greeted him in 2009 would have exploded into full-blown Tulsa 1921 style riots had he dared to put forth a proposal like this.  But Joe Biden- Good Ol’ Uncle Joe; Amtrack Joe; Delaware’s own 3rd Senator from Pennsylvania; the textbook definition of the Everyman– he might just have a shot at doing something this crazy and consequential.  The reality is that the sweeping structural change that America so desperately needs has to come from someone that America is already hard-wired to trust and accept.  This is especially true if that someone is not himself wired to advocate for sweeping structural change.

Barack Obama, Joe Biden

After all, LBJ was nobody’s bet to usher through the Civil Rights Acts that radically changed the complexion of America- literally and figuratively- in the late 1960’s.   That’s why its smart politics for us to embrace guys like Joe as long as they want to embrace us right back.

To wit: middle-of-the-road Joe can deliver far more progressive policies than anybody who has ever spoken the word “revolution” outside of a college history classroom.  Democrats frequently identify “income inequality” as the greatest economic threat to the stability of our nation today.  Of course they are right about that- in theory.  But the truth is they can’t really solve  the problem they are calling “income INequality” in a system that is not now nor has ever been designed to create or support income Equality.

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“Income” is a very broad term and generally encompasses every single source of wealth that an individual may draw upon at their discretion.  Among other things, that means property equity income, financial instruments income, inheritance income, investment income, royalties income, residual income, etc.  All of these distinct ingredients are mixed together to make up the income disparity between Americans.  And since all of them are baked into the cake we should not offer slices of that cake on our policy menu that implies we are addressing them all.  We know damned well that we cannot.

I am all for solving big problems with big ideas but rounding all of that up into one effort to solve the destabilizing impact of “income inequality” is an impossibly heavy lift.  It is a losing proposition that could poison the well of victory we are dying to drink from in November.  The great news is it is not necessary to attach all of the rewards that flow from playing well in a competitive market-place to solve this problem.  And yes, that includes those that did not “play well” themselves but who are reaping the generational benefits of predecessors that did.  Democrats need to redefine the problem and reframe the debate if they really want to serve the 90% of us fighting for our share of the 30% of this nation’s wealth left to us by the obscenely wealthy top 10%.  Since the vast majority of we 90%ers are actually wage earners, the issue we can meaningfully address is our distorted distribution model of corporate wealth.

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Taking aim at solving wage disparity as a primary means for redistributing wealth will work.  Shifting compensation from the top of the workforce pyramid to every level it stands upon is a winner.  Planning, messaging and executing that properly could be all that is necessary to make America become what it has falsely claimed to be for far too long.  How “free” or “brave” is the average worker when his boss has virtually unlimited power over him in the workplace due to grossly unjust and unjustified wage disparity?  The “negotiation” explanation has never passed the smell test because it is another convenient round of victim blaming- America’s greatest pasttime of all.  In the end empoyers pay employees what they want to pay them as long as they can escape the scrutiny of regulators.  Regulators who, by the way, used to bring knives to gun-fights but are now bringing water pistols.

Statistical models vary but national labor statistics reflect that on average CEOs of mid-size to large corporations earn about 300 times what the average rank and file employee earns.  Samuel Stebbins of MSN Money released a list of CEOs that make more than a thousand times what their average employee makes.  That is patently ridiculous.  Although America loves to promote the mythology of the genius-visionary-executive, it is little more than propaganda to convince the average working guy that the people at the top actually deserve to live so much better than they do.

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The great news is this is a problem that actually can be solved.  We have a living breathing model for how to solve it that we can readily relate to and readily apply.  All we need is the political will and the right messenger- like America’s favorite Uncle Joe.  The National Football League has already become a religion in America, so let it also be our salvation, too.  The NFL salary cap can deliver us from the evil of wage disparity and provide us with a quick economic course-correction like few other policies could promise.  If corporations had a cap on how much more the executive employees could make as indexed to the earnings of the average employee we could knock out wage disparity with one clean head-shot.  And at the same time, income inequality would absorb a devastating body blow.

A great illustration of the politics of the salary cap emerged earlier this year when news broke that NFL quarterback Russell Wilson of the Seattle Seahawks  signed a new contract and became the highest paid player in the league.

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Because the NFL has a strict salary cap rule in place, the discussion that ensued immediately turned to the most salient and instructive themes of wage disparity.  Sports “journalists” began to openly fret about the state of the Seattle Seahawks.   “How will the Seahawks pay for the other players they need after paying SO much money to Russell?”  they wondered.  “Shouldn’t Russell take less money so the team would have more money to spend on other positions?  Tom Brady won 6 Super Bowl rings and he takes less money all the time!  Since that is a winning strategy for a winning team, isn’t that the model of how things should be?”

Set aside for the moment that most of what comes out of sports writers and pundits is no more valuable or insightful than what comes out of a pornogrophy production studio.  And set aside for the moment that the handwringing about over-paying a star quarterback comes up almost exclusively when that quarterback happens to be black.  And set aside for the moment that the example these fools are using is worthless because Tom Brady is the only player in NFL history that is married to zillionaire panties-model.  Setting all that aside, there is actually a valuable point being made and a cultural precedent to stand on.

If American corporations had to follow regulations that capped their top paid employee/officer/executive at 50 or 100 times what the average guy on the team was paid there would be a ton more money to spread around.  Of course proportional wage bands would be set to include all of the employees/officers/executives of the enterprise.  Then maybe we could stop subsidizing employers who pay poverty-level wages to their workers.  When workers become stakeholders instead of cogs the entire game changes and it changes for the better.

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To be sure, the devil is in the details and there are a ton of details to be filled in and fleshed out here.  But at least we have identified the real problem, a real solution, and most important of all, we can finally have some goal clarity.  Where the discussion stands today all we are proving is that we have bigger hearts and minds than the opposition. But we are going nowhere.  Being against “income inequality” for progressives is as amourphous as being against “big government” is for conservatives.  Anytime you can identify the enemy but can’t identify your goal, your enemy can relax and breathe easy.  It is time to stop letting conservatives breathe comfortably while setting up a permanent American Oligarchy.  It is going to be hard to round up a bunch of rednecks in North Carolina and wahoos in Ohio to go out and rally against increasing their own wages.    This my friends, is a fight we can win.  Especially with Joe Biden in our corner.

π ∞

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