Quote:
Originally Posted by Skinsfan
From an economist's point of view, productivityis the amount of output per unit of input. Basically, GDP divided by employment.... So, in this context, the most productive people can be defined several ways:
A) People who spend lots of money in our economy
B) People who faciliate/produce the products to be consumed
Working the counter at DQ is certainly a HARD job... you're on your feet, etc.... But the most productive person at that DQ is the owner/franchisee who invested the money that allowed for that specific DQ to be built... or the store manager that makes sure the operation is going as smoothly as possible.... or the business manager who finds a way to be more efficient, and increase the revenue stream... they are supplying more to GDP than the poor guy working the counter.....
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I agree - it was an error for me to confuse hard work and productivity. You are right, they are not the same thing. You can work very hard digging ditches, but the value of that may or may not be very economic.
Now, that said, lets see who the real benefactors were of the latest runup - the executives in big oil in the last 2 years. They had stock comp that went through the roof as a result of the runup in oil, that even they themselves admit they had almost nothing to do with (and if they did, ha, bad then too). They were lucky, certainly not productive.
Productivity happens with initiative to find efficiency, and the means to execute on that initiative. Investors get capital gains rates that are lower than W2 income rates exactly for that reason, and IMO, thats a good thing.
But if we are talking about W2 income, which is what is being raised, you have to admit that executives getting on average 300x the lowest person is an outsized reward for productivity that is probably a.) nowhere near that much higher and b.) is probably more towards the line manager where the action takes place. At the highest corporate level, compensation has much more to do with who you stack on your comp board than your capabilities. Investors should be rightly pissed that the managers of the companies they own are taking so much out of the enterprises they (us) own.