There has been a lot of this going on. Jonathon Chait is suffering from it acutely, though we have not discussed his case so much yet. I’d like to sometime soon.
No sooner than the Slate CEO pay article appears, Danny Vinik on TNR denounces it:
The ostensible harms of income inequality are expressed better by Vinik here; there’s some thought income inequality correlates to lower economic growth.
You know, maybe there is a correlation, broadly. Thing is, SFW. Correlations are not causality, and CEO pay would have nothing to do with it for reasons of mechanics that we (which is to say, “I”) explained here. IE, CEO stock option grants are magic transactions where corporate boards create monetary value out of thin air, for which there are several immediate beneficiaries and no losers.
There’s no plausible explanation that can be offered by anyone to explain how this transaction retards broader economic growth that would be otherwise benefitting the middle class. None.
None. None. None.
Indeed, there’s an obvious argument to be made that if you overtax these transactions, companies will stop doing them. At that point, it’s not that the wealth goes to the worker. It’s that it doesn’t get created at all. Further, there’s no piece for the government to get as taxes, those taxes going to social programs that do benefit the lower and middle classes.
There’s a certain level of purposeful obtuseness that has to be maintained for a guy to overlook the mechanics and not get this.