This year, a PGA golf tournament sponsored by FedEx paid the winner $15 million for the win. For those of you who don’t golf, a tournament consists of 18 holes of golf (four hours) each day for four consecutive days. The winner is the golfer that shoots the lowest total score for those four days. The $15 million first place payout equates to $937,000 per hour. Fifteen and thirty years ago, respectively, a winning PGA pro golfer got an average of $15,600 and $6,250 per hour for a PGA victory.
This tournament winner’s share has increased almost 20% per year for 30 years. The average American worker’s wages increased a little over 2% per year over that same period of time.
If FedEx had given their employees, who worked hard to generate the millions of dollars to sponsor the tournament, the same pay raises as they gave the golf pros, the FedEx $10-an-hour employee 30 years ago would now be making $1,500 per hour today.
A second example of inequity of pay is Mark Zuckerberg, who has accumulated $70 billion of wealth, held as unrealized capitol gains in Facebook stock, over the last 10 years. This vast wealth has never been taxed and amounts to $350,000 per hour. Also, during that same 10 years, Zuckerberg was paid a salary and benefits that allowed him to do anything he wanted and buy anything he wanted or needed.
Since too many of our capitalists are grossly over compensating themselves and other insiders, our leaders must adjust our laws to require that a reasonable amount of the bounty created by capitalism be shared with the American worker or else this grotesque executive compensation, which is currently causing capitalism to hemorrhage, will lead to a capitalistic calamity.
Henry Ford said, “Higher wages are not an additional cost under proper management. Better paid workers are more willing and efficient.”
Here are five steps to improving our conscienceless capitalistic system:
Step one — Create a legal distinction between a medium-large corporation and a ma and pa small business. Small businesses inability to pay higher wages should not be used by big business to short change their workers.
Step two — Since there is such a difference between states like New York and Mississippi, let the states set the minimum wage for ma and pa small businesses. No federal minimum wage. Medium-large corporations would have a minimum salary package that would include a reasonable salary, health insurance, retirement, and paid vacation. These might vary depending on region and type of business. Each profitable company would pay a certain percentage of profits in stock to each employee with each paycheck as a bonus. This would mean that the Walmart, Amazon and Dollar General employee would get a fractional share of stock with each paycheck.
Step three — Require these corporations to pay $50 into their employee bonus account for every $1 they donate to a politician or political party and pay $10 into the same account for each dollar they donate to a not-for-profit corporation, such as a PGA tournament.
Step four — When a private company goes public, designate half of the shares that the principals, venture capitalists and like can retain, and divide them proportionately with the employees based on pay grade and years of service.
Step five — For every stock option awarded to an insider, $100 would be awarded to the employee bonus account to be distributed yearly to the employees.
Ford also said, “The highest use of capital is not to make more money but to make money do more for the betterment of life.”
Think about this: A PGA touring pro golfer makes 117,000 times an hour more than the worker that washes his plates before he eats at a restaurant, launders his sheets before he sleeps at a hotel and cleans the restroom before and after he uses it.
Capitalism doesn’t exist so the wealthy can take advantage of the American worker. It exists because it promotes industry, creates jobs, and increases productivity. It won’t die because it is bested by socialism. But, if its compensation inequities are not recognized and remedied, it will kill itself.
Matt Mays is a Sebring resident. Guest columns are the opinion of the writer, not necessarily that of the Highlands News-Sun.