Imploding Robin Hood Capitalists

Last week I read a very interesting article on Barbara Ehrenreich blog, Barbara’s Blog. The article is called “15 Steps Toward a Happier, Healthier American in 07”.

Some of the items on her list are not surprising (e.g. getting the troops out of Iraq, or fighting global warming). The others are all very interesting and, one in particular…

“Raise the minimum wage to $10 an hour and establish a maximum wage of, say – generously speaking -- $5 million a year.”

… was wonderfully surprising, as well as provocative. I don’t know if this idea has been talked about in any serious political arena, but why not. Does any human being “need” more than 5 million dollars a year in salary? What noble and important deeds can any one person achieve in one year’s time, which warrants compensation greater than this?

This reminds me of an article Gretchen Morgenson (here, needs a subscription) wrote for the New York Times (here) in December 2005 about Ethan Berman, founder and chief executive of RiskMetrics. Mr. Berman requested that he receive no increase in salary, no stock options, a smaller bonus than the year before, as well as refused a sum of the company's profit-sharing equal to that received by all employees.

His reasoning was, amongst other things, that as a top executive he does not need monetary compensation to feel more of an owner, or increase his commitment to the company. The money he would receive would be better distributed to those people in the company whose engagement and performance have shown them to lead other employees by example and not by mandate.

I like to think of Mr. Berman as a bizarre modern imploded Robin Hood capitalist. Instead of stealing from the rich and giving to the poor, he was stealing from the rich (himself) and giving to the (relatively) rich (in terms of leadership abilities).

Now, I am not sure that Mr. Berman yearly earnings lie under Ms. Ehrenreich’s maximum salary. Maybe Ms. Ehrenreich should invite Mr. Berman over for a cup of coffee and invite Ms. Morgenson along as well, and the three of them could discuss just how they could propagate such a novel notion to the masses. And, even more importantly, maybe they could come up with a plan to propose such a practice to new possible imploding Robin Hood capitalist in large corporations. Wouldn’t that be a lark?