Why an inequality busting “maximum wage” is both economically viable and politically practical
A maximum wage could be both economically viable and politically practical, a leading analyst has claimed.
With minimum wages well established in many countries around the world, new research suggests capping income could create “a world without a super rich” and reduce the gap between the rich and poor.
The paper comes hot on the heels of Resolution Foundation research that found the UK’s wealth gap has been widening over the past decade.
The think tank estimates 1 per cent of adults, some 488,000 people, own 14 per cent of the nation’s assets – worth about £11 trillion.
At the other end of the financial scale, 15 per cent (7.3 million people) either own no assets at all, or are in debt.
Sam Pizzigati, author of The Case for a Maximum Wage, says: “Modern societies set limits, on everything from how fast motorists can drive to how much waste factory owners can dump in our rivers.
“But incomes in our deeply unequal world have no limits.
“Many of our largest corporations pay their executives more in a morning than their workers can earn in a year.
“Capping top incomes could tackle our rising inequality more effectively than conventional approaches to narrowing our vast economic divides”.
The notion certainly has political appeal in some parts of the spectrum, with Labour leader Jeremy Corbyn championing proposals of a maximum wage following Fat Cat Wednesday.
Speaking on the BBC Radio 4’s Today programme, he said: “”I would like there to be some kind of high earnings cap, quite honestly…I can’t put a figure on it.
“The point I’m trying to make…is that we have the worst levels of income disparity of most of the OECD countries in this country. It’s getting worse and corporate taxation is a part of it.
“If we want to live in a more egalitarian society and fund our public services we cannot go on creating worse levels of inequality.”
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