First on the subject of income inequality, my big question remains – after seeing this blog post, linked articles, and general media pieces – how does the growing relative difference between the rich and the poor actually hurt society, specifically? I don’t have strong opinion on the matter frankly, but I just don’t see the objective connection. It reminds me a little of how homophobes argue that gay marriage devalues straight marriage – one isn’t directly connected to the other.

Agreed, poor people not making enough money for a decent life is a problem, likewise with the uber rich who cheapen society with their blind lust for money. But let’s say Person A makes $40K/year (right on the edge) and Person B makes $250K. Then person B gets a big raise. That’s not actually hurting person A as I see it. The much larger threat to person A is the rising cost of food, fuel, education, etc. which is largely disconnected from the rising wages of the upper class (or is it?)

In the Bennett article, the part about “Inequality is corrosive. Competition for status and goods increases…” is the only real specific answer to the question, but I think this is pretty weak IMHO. I just don’t think most peoples’ self esteems are deeply shaken by the nice cars and designer sunglasses of the rich. Casual jealousy abound, but damaging to society? I bet not so much.

Is there a stronger argument to be made, or perhaps I’m just not getting it?

So on the fluid shares concept, I can see the value in this but don’t see how this would practically scale. I whole heartedly agree with your statement “Their business would only flourish when the person in charge cared first and foremost about the business and not the pay cheque.”, but I can say from experience that this rarely happens, even in small businesses. The CEO of a company I used to work for actually admitted to me once that there was *no one* in the company that actually had a passion for the product and the client needs. This is why people start their own businesses I guess, and it would be great if more people did that. And it should be noted that employees are usually just in it for the money like their bosses.

I actually have somewhat mixed feelings on the fluid shares approach. On one hand, I don’t believe everyone has equal skills and performance, and therefore shouldn’t be compensated equally. This would drive the A players out the door. But at the same time I would have no problem paying one of my high performing employees a salary as much as I got if necessary since I’m not really in a business for the money anyway. These are tough decisions, which is another reason why good managers get paid a lot;) But I think trying to find other meaningful rewards for employee performance is really important since money isn’t really the most important thing to most people (studies have shown.)

But until CEOs have a stronger motivation than money to accept a job, filling those positions with subpar compensation offers seems unviable, no matter how many highly intelligent people are out there. It’s just not rational for someone to take a lower wage unless there’s another more compelling incentive or no other competing opportunity.

And one point to emphasize is that I think peoples’ sense of self worth isn’t as malleable as suggested. In the context of fluid shares, if the shop keepers all of a sudden get a 100% raise, sure they’ll be stoked and take the money, but I think more often than not their sense of pride will derive from making *enough* money to adequately provide for their families, and have little to do with their relative salary performance.

I hate to just be a critic, but tend to think the current capitalistic structure is the worst type of economic system, except for all of the other ones;) But totally open to persuasion.

Keep striving for the balance you need. And yes, I agree, work is part of life not something outside of it.

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