Earn Less, That Others May Work
The question evokes two lines of thought:
l. As President Obama points out, the opportunity to serve should be seen as a privilege and not as a sacrifice or as an opportunity to make gobs of money. Individuals who work in nonprofits have a privilege. Yet in recent years, their salaries have reached unbelievably large sums, no doubt because of a perceived but inappropriate parallel with the for-profit sector. Senior administrators, coaches, and finance managers, who may make 50 times as much as a professor, need not take vows of poverty. But $500,000 a year -- more than the U.S. president and or a Supreme Court justice -- is not a vow of poverty. Moreover, huge expense accounts
should be discouraged. Even wealthy donors can make do with sandwiches and salads rather than caviar and champagne.
2. Since I've already been politically incorrect, I'll share my broader plan, already published a few years ago in Foreign Policy magazine. I believe no American should be allowed to keep more than $4 million a year (100 times the average salary, often of a family!) Anything extra should be returned to the government or given to charity. No American should be allowed to pass on more than $200 million dollars to his descendants (50 times the yearly allotment). Again he or she could make as much as desired but would have to return the excess to the government or to the charity. This would be a small but meaningful step to a more equitable society, in the sense of the philosopher John Rawls.
When I published this proposal, I received an amazing amount of flack. Almost no one had anything good to say about it. Americans, whether they are as wealthy as the McCains or as average as Joe the Plumber, think it is our God-given right to accumulate as much money as we can. I would like to think that the financial meltdown of recent months, and the unbelievably selfish and insensitive responses of the automobile, AIG, and Morgan Stanley executives would give one pause. But frankly I doubt that it will.
At last, to your question: Yes, I think that highly paid leaders should lower their pay, thereby allowing more employees in their organization to remain on the job. Optimally, the leaders would do so quietly because it is the right thing to do. But I don't mind if they get some public relations benefit out of this proper behavior.
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