Question

For this discussion forum, begin by reading the following statement and decide whether you agree or disagree with the statement:

“The government should set a maximum on the amount of money that company presidents can earn.”

In a post of several paragraphs, discuss the reasons why you agree or disagree with the above statement. What evidence from the lesson or outside research can you find that supports your stand? How can you connect your argument with the terms and ideas we have studied in this lesson?  Include in your post evidence for your stand, especially related to the effects of such an earnings cap for company presidents on other groups such as consumers, producers, workers, savers, and investors. Remember: there are often additional consequences with price controls.

Answer 1

Wage is the backbone of a common man’s livelihood. It has lately been seen that the prices of the commodities to sustain the livelihood has increase many folds over the tears, however, the wage paid to the common man has n to increase accordingly. This has resulted in an imbalance between the current rate of prices in the market, the level of inflation and the wage rate received by the common man and their level of sustainability. However, the wages or salaries of the top bras of a company or firm have increased many folds over the years. This therefore sappers to be a scenario where , the rich are getting richer and the poor are gradually becoming poorer.
                                            Recently there have been many voices from round the country that the top officers of a firm , specially the Presidents of the company are the people who take away all the profit earned by the company and the common workers are left with only their salaries or wages which is also getting reduced comparatively with the increasing prices of the commodities in the market. Therefore, many of the labor right activists and supports of the labors have come up with the opinion that the wages taken or earned by the Company Presidents must be reduced or a maximum limit should be set for the Presidents wages, which cannot be exceeded.

                                             This statement although is filled with the pain of the labor class of the country, is not a justifiable reason as to the Government’s interference in this matter. A maximum limit set on the wages taken by the company Presidents would leave a negative impact on the over company’s future and this might come to haunt back the Government as the company’s internal health might deteriorate. An individual is the President of a company, in itself is a statement that justifies his credential and value. If is not important or critical or had not work enough to bring a company to a level it is today in, the company would not have existed. In many cases, the Presidents are the founding father of the company. It is the result of the hard work of the person that has today created the company and its presence in the market.

                                            If a maximum bar is set by the Government on the President of Company’s wage, this will be a hindrance to the growth of the company. This is because, the company being a private good, its president has total authority to decide, who should receive the products of the company or how much should be paid to whom. This will go against the rights of the President. Although the President is a highly paid individual, but he is there because he has done enough hard work to justify his presence as the President of the company. He too has legal right to earn as much as possible.

                                           Moreover, if the President has a upper limit in the receipt of his wages, this may go against the workers or laborers in the company, as then the President may stop dedicating his services to the company with full dedication. The President being the topmost position in the company, even his smallest of decisions may affect the whole company and the many workers working in the company in a large way. Therefore, it is advisable to not set any upper limit on the Company President’s wage.

                                        The Government should rather be more decisive towards the appropriate and quick implementation of the labor law which could safeguard the interest of the average workers and the salaries or wage that they receive. The Government should amend the labor law such that there is a minimum limit set to the wages of the labors. That is, any company has to pay a certain amount of minimum wage to a laborer who is working at a particular designation and according to his nature and quality and quantity of work. This will be a more decisive step towards the implementation of a balanced society, and the wage level of the workers would increase, thereby stabilizing the economic equilibrium of the nation.