Is it time for Maximum Wage

[TooMuch]

58. Maximum wage notion actually picking up global momentum

The idea of a "maximum wage" -- a cap on income tied to a minimum wage -- is actually picking up some international steam. The Egyptian labor movement has helped make a maximum wage a principal demand of the Tahrir Square movement.

In the recent French presidential election, candidate Jean Luc Mélenchon ran from the left on a platform that demanded a maximum wage, and his income cap advocacy has pushed the eventual presidential winner, Francois Hollande, to promulgate regulations that cap CEO pay — at enterprises where the government holds a controlling interest — at 20 times the pay of each enterprise’s lowest-paid worker.

Meanwhile, here in the United States, the Dodd-Frank legislation includes a clause that requires U.S. corporations to disclose the ratio between their CEO pay and the pay of their median worker. Corporate America has unleashed a ferocious lobbying assault against the measure, and the SEC hasn't yet written the regs necessary to enforce the mandate. The AFL-CIO is leading a campaign to get the SEC to act.

Franklin Roosevelt would no doubt approve of all this. In 1942, he proposed a 100 percent tax -- a maximum wage -- on all individual income over $25,000, the equivalent of about $350,000 today. More on the history of the maximum wage idea in the United States here.