Here’ my fifth Big Idea: Solving Wealth Inequality
Let’s face facts; we have problems that need to be solved. Wealth inequality is one such problem. Only the top 10% of Americans are seeing their wealth grow while the rest get less and less wealth. Everyone is aware of this national problem.
Here are more statistics:
The gap between the top 10% and the middle class is over 1,000%; that increases another 1,000% for the top 1%. Per PolitiFact and others, in 2011 the 400 wealthiest Americans "have more wealth than half of all Americans combined."
Usually, the solutions put forth by politicians are so complex no one can understand them, let alone implement them. Politicians think to be acceptable, a solution must be complex. Not true. Sometimes the right solution is simple and maybe even counter intuitive or hard to implement.
Most people think that it can be solved by taxing the rich and giving to the poor through tax breaks. Yeah, right. It hasn’t worked yet. I will attempt to point out the obvious and simple solution to wealth inequality. The problem is excessive profits, excessive inheritance, excessive wealth and excessive salaries. Note the word “excessive”.
Here are my recommendations:
Excessive Profits: Consumers pay too much for products and services that provide excess profits to the rich. There should be better transparency on the real cost of products and services. We already have labels for nutrition and the country where the product is made. I propose adding more information to the label. Here are the items that should be placed on a label on all products and disclosed for all services:
- The actual percent of the cost that is contributed toward profit. If we knew this, most of us would not purchase anything with excessive mark up. I think 10% or less is a fair profit.
- The salaries of the CEO, the Chairman of the Board, the CFO and the salary of the lowest paid employee. It must include all the perks, stock options and golden parachutes.
- The percentage of the product or service that is from outside of the US.
Excessive Inheritance: We all know people, or know of people, who are born with a “silver spoon” in their mouth. It gives them a substantial head start in life with access to the best education and employment. The rich just keep getting richer and so do their kids. According to the Institute for Policy Studies, "over 60 percent" of the Forbes richest 400 Americans "grew up in substantial privilege".
I propose that the government establish limits on inheritance. No one should inherit more than $1M. Anything above that goes to the government.
Excessive Wealth: The media reported that the top wealthiest 1% possess 40% of the nation’s wealth; the bottom 80% own only 7%. That’s not right. I propose that the government establish limits on wealth. No one have more wealth than established by the government. Pick a number. I think $10M is a good number. Anything above that goes to the government.
Excessive Income and Salaries: The media reported, the "richest 1% in the US now have more additional income than the bottom 90%". The media goes on to say that the average employee "needs to work more than a month to earn what a CEO earns in one hour.” That’s not right.
- I propose that the government establish a ratio between the salary of the CEO and the lowest paid employee. It must include all the perks, stock options and golden parachutes. Pick a number. I think 300 to 1 is a good ratio.
- If the CEO gets a raise, everyone must get a raise.
- All for-profit companies must have profit sharing.
This won’t solve the inequality, but it’s a start.
AUTHOR’S NOTE: To the humorously challenged, this is a satire. I think.