Members of the CA Legislature think that some company CEOs make too much money and want to punish them for being successful. Here are some detailes from the Mercury News.
SACRAMENTO — Noting that America’s middle class has lost its distinction as the wealthiest in the world, two Bay Area lawmakers say they’re attacking income inequality with legislation that would link a company’s tax rate to the gap between executive pay and average employee wages.
It would be the first law of its kind in the nation at a time when the growing plight of the middle class is becoming a major issue in this year’s midterm elections.
Three decades ago, chief executives made a little more than 40 times as much money as an average worker. Now, CEOs of elite companies like Silicon Valley’s eBay and Oracle earn average compensation that’s more than 350 times greater than what middle-class workers earn.
Under SB1372, if the CEO of a publicly traded company doing business in California makes more than 100 times the pay of an average employee, that company’s tax rate will go up from 8.8 percent to as high as 13 percent. Companies with relatively little disparity will get a tax break, according to the bill, sponsored by Sens. Mark DeSaulnier, D-Concord, and Loni Hancock, D-Berkeley.
What greater incentive could the Legislature come up with to drive companies from the State — setting CEO salaries? More liberal tinkering with the free market system that will damage the states economy. When will they ever learn?