Kiwiblog

Waikato history student Ryan Wood writes in the Herald:

This is where the maximum wage comes in. If the top salary is legally fixed at, say, $200,000 a year, these economic miracle-workers running companies will have no choice but to start their own businesses where, as shareholders, they can indulge in the dividends they deserve. The creation of new companies will in turn lead to more jobs, thus negating the need for any “starting-out” wage.

A maximum wage also has a trickle-down effect. The millions of dollars that would have been paid to CEOs could instead be paid as bonuses to workers, or used to lift the average wage of employees at the company. These people could then spend their extra income, further supporting the economy.

Critics are likely to label the concept of a maximum wage as “socialist”. In fact, wage reduction is a neo-liberal idea. The National Government has already espoused it, although their focus was on workers rather than their bosses.

A maximum wage is indeed not socialist, but full out communist.

You see it has been tried. In several countries. In the USSR they had maximum salaries. They had the exact view that Ryan had. They though no one should earn over a certain amount as a salary.

It failed. It was a disaster.

Ryan seems to think we live in isolation from the world. I’d love to see him find a surgeon to operate on him, should he need it, with a $200,000 salary cap. They’d all be in Australia.

The video is of interviews with delegates at the DNC convention. Only around half the people approached said they disagreed with banning corporate profits!

Posing as an anti-business crusader, Peter Schiff found a number of DNC delegates and attendees who support explicitly outlawing profitability. We deliberately avoided speaking with the occupy protestors camping outside in tents to get a more “mainstream” Democratic perspective!

It would be fascinating to see what results one would get posing the same question at the CTU Conference or the Labour or Greens conferences.

Hat Tip: Not PC

My spies in Young Labour report that they will be hosting at their upcoming summer school a representative of the Communist Youth League of China – the youth wing of the Chinese Communist Party.

I think this is an excellent move. The Chinese Communist party is far more capitalist than the average member of Young Labour. Hopefully they will learn something about the importance of economic growth!

I was never sure of John Minto is a communist or just a socialist (in terms of economic philosophy). He answers that today with his blog advocating a salary cap and 100% tax rate on top of that:

My pick would be to set the maximum income at 10 times the minimum wage. This would mean a maximum income of $250,000. The easiest way to enforce this would be setting a 100 per cent income tax rate for the combined income from all sources (including share allocations, allowances etc) above this level.

This system of salary caps is not a new concept. Most communist countries have or had such salary caps. Most have abandoned such practices, as they have learnt what happens when you do. I think North Korea and maybe Cuba still have such salary caps though.

Note Minto’s proposal is not just for salaries. He proposes 100% tax on income over $250,000 from all sources.Can’t see a lot of people setting up their own companies or businesses in future.

What will be most amusing is to see how much the tax take drops. It wouldn’t just be people earning over $250,000 who would be leaving. Minto doesn’t understand what aspiration is.

The Press reports that the SIS has released files on individuals whom they no longer monitor. They should be commended for such openness – this seems an initiative of new Director Warren Tucker who is well regarded.

Obviously various current or former Marxists, communists and Maoists are upset about the fact their files reveal the SIS were monitoring them.

But the reality is the world today is very different to the 1970s and 1980s. The western world was, to be blunt, engaged in a massive struggle with the Soviet Union for global control. They communist states were enemies of freedom and the West, and posed a huge threat to our way of life.

And these people who were monitored were active in groups that were on the side of the communist totalitarian states, not our side. They won’t put it like that, but that was the reality. They never ever condemned the communist states – in fact they did friendship visits there and extolled how good they are.

Luckily the Soviet empire collapsed in 1990. We now have the wonderful luxury of having mainly put that threat between us. Today a communist is just a hardline economic socialist. The only threat they pose is to good economic policy, and that is not a matter of national security. It is appropriate the SIS no longer regards people active in communist groups as people who should be monitored.

But again it was different before the collapse of the Soviet Union. It wasn’t just about disagreeing on economic policy.

Now this is not to give carte blanch to everything the SIS did. Some of the revelations don’t put them in a good light and they themselves today probably don’t defend certain things. Again it is to their credit they they are releasing it. But just to make the case that the context in the 70s and 80s was vastly different to today. Unless you lived through it, you can’t no how much the world changed after that glorious summer where totalitarian communist states fell one after another until they were almost all gone.