I'm breaking up the post into several sections so the post isn't a mile long.
In this first section, I give you "The Good":
I think it's fairly obvious that I'm not a huge fan of how the protests are going, but I do believe some of their concerns and anger are warranted.
Wall Street is Corrupt and Unethical
Possibly the most persuasive argument, I believe the finance industry is completely unethical in their business procedures (funny because Finance probably contains the highest percentage of people who have taken a "business ethics" course).
However, when their bad bets finally caught up to them, the government bailed them out, put little/no limits on how they used the funds, and even allowed them to get bigger (see: BoA/Merrill Lynch).
If this is the case, why would they ever want to change?
CEOs (some) are Overpaid
A recent article from Business Insider listed The 8 Most Overpaid CEOs in America.
An example of one (and a former employer of mine):
5. William SwansonTrue, most CEOs probably don't deserve their multi-million dollar salaries, but I do believe in the Free Market so they will make whatever the market will allow.
> Company: Raytheon Co.
> Total compensation: $18,787,343
> Change in stock price: -10.1%
Defense contractor Raytheon (NYSE: RTN) had net income of $1.8 billion in 2010 down from $1.9 billion the year before. Revenue was nearly flat at $25 billion. Raytheon shares have probably suffered because of concerns about the government’s defense budget. The firm’s pension liabilities are nearly $5 billion. Swanson’s compensation raises the question of whether a company in a troubled industry, even if relatively well run, should pay its CEO this much while shareholders do poorly. Swanson has made almost $58 million over the three years that ended in 2010. Based on how investors have done, that is excessive.
Instead of government regulation, executive salaries should be more closely tied to company performance.
What's wrong with a $1m (or even $5m!) base salaries with bonuses based on performance? It could even be structured so that a very successful year resulted in net salaries in excess of $20m.
I think few would complain about a well performing company paying it's CEO 2% of its billion-dollar net income.
Companies Need to Pay More Taxes
Or less taxes. Or taxes at all.
How about a single, consistent corporate tax code?
I think we would all do better with lower taxes in general, but I feel like some companies are getting off easy...
I can't complain too much about companies through P&G because I have to pay 25% of my salary to the government; but how did AT&T get a $1.05bn rebate??
You can't really blame companies for trying to find loopholes to reduce their tax contributions. If I could, I'd hire a department of CPAs to allow me to keep more of my money too.
I blame the government and the unclear/confusing tax code. I'm not quite a fan of a blanket policy like 9-9-9, but thousands of tax breaks and exceptions will only result in discrepancies like the ones above.
Wealth Inequality is a Problem
There will always be rich and poor (at least, as long as the commies don't take over), but a widening wealth gap is never a good thing.
History has shown us, that only leads to increasing civil unrest (see: French Revolution). Although it can be argued that OWS is proof that this has already started.
Anyway, Business Insider (I love that site) has an article that does some analysis based on the following graph/data:
If you don't want to read it all, it boils down to the final few paragraphs:
In the past 30 years, 96% of the growth of average incomes in this country have gone to the richest 10% of the country. And in the past 10 years, the incomes of the other 90% have declined.
The next question, of course, is what has caused the shift of the past 30 years, as well as what can be done to reverse it. The cause is likely a number of factors, from globalization (the entry of 3 billion low-cost laborers into the workforce) to tax policy to technology. And there's no easy and quick solution.
But you'd certainly have to be a member of the top 10% to think that the trend over the past 30 years is okay. You'd also have to be pretty short-sighted. Because if that trend continues, and if you're in the top 10% because you own or work for a company that serves the other 90%, demand for your products will soon be going down.
That's all for now/all I care to write about.
Next up: The Bad.