Dismissing Racist Explanation
Recently there has been some fluff that we couldn’t find American workers to build a new integrated circuit plant. Our workers say it is because they are not getting enough money. Boomers bemoan: -Our kids are too dumb to get the jobs we used to have. Depend on Americans to find the racist reason even when it is against us. Foreign workers may get less than citizens, but that is not enough for a business decision, particularly on a subsidized plant. As I explain in this blog in Income Disparity and Bribes , in 1969 America removed discretionary fund as an accounting entry. This has several consequences. Companies moved the amount in that entry to executive compensation, so it is now after tax. Piketty’s book Capital in the Twenty-First Century has a graph showing executive compensation on an upward diagonal from 1970 on. CEOs used to get ten times base earnings. Take the difference then apply the tax rate gives us the total compensation, for the bribes and kickbacks require...