Recently there has been a hue and cry about the high salary and bonuses that some corporate executives, especially bankers are drawing. The occupy movement that has erupted in many countries around the world represents this anguish of the people. There is a simple way to fix the problem. It is called the rule of ten here. If adopted such a rule will not only strengthen capitalism, it will also strengthen democracy. Simply stated this rule states that within any corporate or government organization the cumulative annual benefits (that include salary, bonuses, shares and all other benefits) of any individual within that organization shall not exceed ten times the total benefits of the lowest paid individual. This will immediately put a cap to the high bonuses and perks some individuals are enjoying in various organizations.
The basis of this rule is that no individual is less than ten times as capable, hard working or talented than the most capable individual in any organization. In case he or she is, he/she should be in a care home instead. It is only just that the salary structures reflect this reality. Why ten and not nine or eleven? Well some number has to be chosen and a round number is simple to implement.
How will such a rule strengthen democracy? If a referendum is to be called for such a law an overwhelming majority shall support it. Any rule or law that is in accordance with the just aspirations or wishes of the people and is workable strengthens democracy. What about the argument being put by some bankers etc. that this will lead to a flight of talent. That is just nonsense. Such a rule will not lead to a flight of talent. It shall lead to a flight of greed and exploitation instead.
What will happen to the campaign contributions of political candidates if some individuals and corporations are not allowed to get disproportionately rich? No just human society needs campaign contributions that ride on the back of the homeless and the struggling while the likes of Berlusconi have perhaps taken off to their island spa for another bunga bunga party. Quite likely he has enough room for other leaders to join him as other economies around the world collapse under the burden of debt. A democratic Government is elected for limited periods of time. It is to their advantage if they can run the country well in the short term. This encourages them to incur debt. However as debt rises a time comes when the debt can not be serviced and there is default. That time has already come for Greece. Others will follow.
Dr. Ashok Malhotra holds a doctoral degree in engineering from the University of British Columbia Canada. He is also the author of the novel - Nude besides the lake ( http://amzn.com/1463529392 )
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Ashok Malhotra
Economics Article FeedFind More ArticlesSearchRecent ArticlesUsing The Yield Curve Data To Predict GDP GrowthUnited States Economy Becoming More Like Germany in the Near Future?What Is Quantitative Easing and Does It Work?Student Loans Leading To More BankruptciesThe Four Economic SeasonsUS Economic Trends for 2012How to Compete With a Computer in Economic AnalysisGlobal Economic Trends for 2012The Risks of Being a LenderSovereign Debt Problems - United States Or Europe, Who Is Worse Off?Submitted On February 08, 2012. Viewed 7 times. Word count: 444.MLA Style Citation:Malhotra, Ashok".".8 Feb. 2012EzineArticles.com.14 Feb. 2012
Malhotra, A. (2012, February 8). . Retrieved February 14, 2012, from http://ezinearticles.com/?The-Rule-of-Ten:-A-Way-to-Strengthen-Democracy-and-Capitalism&id=6867904Chicago Style Citation:
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