Icahn to Yahoo Finance: It's going to be a real 'bloodbath'

http://finance.yahoo.com/news/read-icahn-policy-paper-sent-to-trump-and-others-151104201.html#


In the paper, Icahn takes a decidedly egalitarian tone, writing:

“The average worker makes approximately $50,000 per year. The average annual compensation of the thirty highest paid CEOs is approximately $47 million per year. (I don’t believe this disparity was ever this great even in most dictatorships!) You will hear many politicians argue that government should not interfere with the ‘business judgment’, of our companies and, therefore they cannot pass laws to encourage ‘income equality.’ This is completely untrue – the sad fact is that the government has actually passed many laws that have brought about ‘income inequality.’”

In a phone interview with Yahoo Finance Icahn says, "In this country, you talk about the wealth gap and politicians say, 'well, you can't legislate equality,' but we legislate inequality.”


“…the American worker is also getting 'screwed' …boards and CEOS have allowed property, plants and equipment of our companies to become the oldest on record and, as a result, the growth rate in productivity per hour of our workers has also become the worst on record and has actually decreased compared to last year. The average age of corporate property, plants and equipment is an astounding 22.3 years, the oldest it has reached since 1941. But I do not believe that most boards and CEOs really give a damn. With many exceptions, CEOs only care about short term results. Perhaps you can’t really blame them because unfortunately, Wall Street judges them based on quarter to quarter results and CEOs receive their egregious compensation based on those short-term results.”

Icahn closes his piece by again coming back to the plight of the common man versus CEOs: “When it comes time to pay the Piper, CEOs will have taken their bonuses and again the workers will be left, holding the proverbially ‘empty bag.’”

All of that may be true. But to correct what he's described requires that we understand what led to it.

Following World War 2, our country experienced the greatest economic boom in history (well maybe with the exception of Saudi Arabia after it discovered how much oil was beneath it's land and how valuable it was to the world).

The primary reason we experienced this greatest economic boom was because, at the time, we had such a stronghold on all the world's technological advance and the world's manufacturing engine.

But then with time, the labor forces in other parts of the world began to compete with our labor force. And they were able to manufacture stuff at FAR less cost because their labor force was willing to work for far lower wages.
That's what caused the tide to turn.

Bob wrote:All of that may be true.  But to correct what he's described requires that we understand what led to it.

Following World War 2,  our country experienced the greatest economic boom in history (well maybe with the exception of Saudi Arabia after it discovered how much oil was beneath it's land and how valuable it was to the world).

The primary reason we experienced this greatest economic boom was because,  at the time,  we had such a stronghold on all the world's technological advance and the world's manufacturing engine.

But then with time,  the labor forces in other parts of the world began to compete with our labor force.  And they were able to manufacture stuff at FAR less cost because their labor force was willing to work for far lower wages.
That's what caused the tide to turn.

That's only part of the story, Bob.  This post is on another thread, with a transcript, but here's the link again:

http://billmoyers.com/segment/jacob-hacker-paul-pierson-on-engineered-inequality/

You can read the transcript at the "Strange is it Not?..." thread where Markle, ever the gentleman, calls Wordslinger a heathen.