Earned Income Credit

Obviously you know nothing about me if this is what you believe of me.

I have bought companies - and then through restructing increased both employee pay and profits.

But you still haven't answered my question.

On what basis are you keeping any of the marginal profits made by hiring a new employee?

Why are you know giving all of the increase in profits to that employee since he is reponsible for that increase and therefore is the one earning it?

 

What are you talking about? Are you asking me to estimate his/her proposed future earnings and put it towards their current salary? Or is it wizer to see what the earning are in actuality and then benefit the employee? There is already a base expectation with in the initial salaried offering. However, a greater increase in profitability will benefit the overall company as well as the individual employee participating in it. I don't junk their salary as in the case of many buy outs.

 

You are still not answering the question.

When this employee earns a profit for the company - above and beyond his compensation - will you be turning those increased profits over to him?

If not - why not?

 

Look its simple math. If I do as you say and pay the Marginal profit I make for hiring the individual I wouldn't get past one employee because the Margin of Profit becomes 0 and as you know you don't hire with a marginal profit of 0 because you are at the optimum. Otherwise you're loosing money on the hire. The point of hiring the individual is to obtain profit and provide employement for the individual. My point is not to for go profit for a company but to create a business model and environment where by you treat your employees well. Provide them with a reasonable salary and health care with options for retirement. This is all I have ever been saying. I also believe that the longevity of a company is based not on artificially inflating quarterly share prices while damaging companys holding, capital, etc... but consentrate on steady growth out of operations and reasonable investment. Rather than the quick buck. This provides a security for employees and if your managers hold to a stakeholder perspective the company acts like a responsible member of society unlike so many that we hear about. You would like to make it about the quick buck but I know what you are getting at and you're wrong I'm not suggesting that business aren't about profit but about profit and much more. I don't want to limit it to just the bottom line. And like I said if companies treated employess much in the same manner as Milton Hershey and George Johnson this country wouldn't have the problems it does now.

 

So how do you decide how much of the income should go to the employee and how much should go to profits ? Which by the way means how much should go to you since you own the company.

Obviously it is a judgement call.

And you feel that you have the right to make the call because you are the employer.

Why then do you feel that you also have the right pass jdugement on other employers that make a different call?

 

I believe there is a morality to running business. I don't believe in relative morality in business like I don't believe in relative morality in faith. Human beings should always be prized and valued above other things. Business are to be decent citizens. When these values are violated I believe I have a right to judge. And again I'm not talking about day to day business decisions I'm talking about overall outlook or world view. Businesses (not all but many) have devalued the human being and treated their employees like the least valuable asset they have. Or they have acted poorly on behalf of their communities. These are values by which I judge others. If another company wants to pay more or less based on its business I'm not going to judge the company unless it violates one of these principles. And like I said if companies had these type of values (and many do however many others do not) unions would not be needed.

 

You were previously critical about another company that you feel does not pay their employees enough.

How do you know what the value of the work that those employees are doing?

How do you know the impact on the viability of the company if the wages were higher?

How do you know whether or not it would be necessary to lay off employees if the wages were higher?

You don't.

What if I were to say that the mere $36,000 that you are willing to pay is immorally low?

What if I were to say that it is immoral for you to keep even a penny of profit from that employees wages unless you are paying at least $50,000 per year?

 

Then I would say you're just trying to pick a fight in favor of C- level greed. I believe this is the core issue with our countries businesses. The problem with out sourcing, the problem with pharmacuticals, etc... There is an endemic issue with how many businesses are run and I think it should change. It would change our country certainly.

 

>So how do you decide how much of the income should go to the employee and how much should go to profits ? Which by the way means how much should go to you since you own the company.

>Obviously it is a judgement call.

Judgement of one's economic power call. In the first 30 years after WW2 the unions were strong and the workers got 80% of the net increase from increased productivity. After our owners convinced Americans that free people didn't need unions, the owners have been keeping 80% of the net from increased productivity. This is why the median adjusted take home pay has been decreasing for the last 20 years.

I'm going to laugh when I read complaints on this list about your 40 year old children living in your house and you babysitting the grandkids while their parents are both working to put food on your table - just like in the good old days. Babysitting infants isn't easy when one passes 70 years - so says The Wife.

 

Ain't gonna be like that...

My grandkids will own your grandkids. :laugh: