Wednesday, September 5, 2012


Frances Woolley has a post about inequality up in which she notes:
It's impossible for all firms to pay their CEOs above the median salary - by definition, half of executives must be paid below the median. If the majority of firms adopt a compensation policy like the Bell Canada Enterprises one quoted above, CEO salaries will increase inexorably. At the same time, allowing firms to bring in temporary workers at less than the prevailing market wage prevents the price of labour from being bid up in response to labour shortages, dampening salary growth for workers at the lower wage end of the labour market.
What I found interesting was not just the argument, but rather what happened in the comments.  People focused on the second piece of the argument (temporary workers at below mean wages) and whether the sense of justice should be local or global.  Consider Mike Moffat:

The inequality discussion changes a great deal if you consider the effects it has on Canadian inequality vs. global inequality. Why should the former necessarily be the lens we use to look at this problem? \
The question here is why is the focus on workers and not on CEOs?  I am a big fan of flexible immigration policies and I celebrate them.  But I wonder if a temporary workers program (at below market wages) isn't just a half-way measure.  Why not have permanent workers who have full rights to switch jobs? 

I am not sure that removing the best and brightest from the third world is always a good plan, but if we are going to do it then why not make it easy for them to stand as equals in the society they are helping to build? 


  1. Joseph - interesting post. I think the reason the discussion ended up focussing so much on the temporary foreign worker program is that it's a bit of a hot button issue in Canada right now. There have been a number of changes to the policy in the last few months. The absolute number of temporary foreign workers isn't high compared to the Canadian population, but it is significant relative to the number of new job openings. Also Canada has a long and not-so-distinguished history of turning against foreign/immigrant labour during tough economic times (e.g. the tightening of restrictions on Chinese immigration in the 1930s).

    Overpaid CEOs, on the other hand, are old news.

  2. I am fairly convinced of the values of immigration (but I am definitely not a representative Canadian). But that is an exceedingly good point that people may focus on the most exciting new policies. :-)

    Hopefully that long history of anti-immigration won't repeat itself. One of the great resources Canada has is it's friendliness to newcomers.

    [and I definitely wasn't trying to pick on Mike who is a really thought provoking part of the WCI team; I don;t always agree with him but his perspective is always worth considering]