# Why has so much power/influence left labor and gone to capital, at least in the US **URL:** \ **Category:** Great Debates\ **Created:** [March 22, 2011, 10:25pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656 "2011-03-22T22:25:52Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Whack-a-Mole](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/whack-a-mole/32/141_2.png) [@Whack-a-Mole](https://boards.straightdope.com/u/Whack-a-Mole)\ **Post date:** [March 23, 2011, 4:56pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/21 "2011-03-23T16:56:56Z")
> [@Shodan](#): > > Suppose the government asked the public sector unions to accept a 50% pay cut. Would you then say “let’s get all the facts before we decide if this is reasonable or not”? Yes, I would. There is no way to decide if these requests are reasonable or unreasonable without knowing more. That said I agree with the above that on the face of it what is being asked for in Oregon sounds unreasonable. A 50% pay cut would sound unreasonable on the face of it too. But without more info we cannot really say for sure if it is or just how unreasonable it might be. ---
**Author:** ![Steve\_MB](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/steve_mb/32/5339_2.png) [@Steve\_MB](https://boards.straightdope.com/u/Steve_MB)\ **Post date:** [March 23, 2011, 5:17pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/22 "2011-03-23T17:17:53Z")
> [@Shodan](#): > > Public employee wages come out of my taxes. Paying my bit towards CEO bonuses is easily avoided by buying somewhere else. Er, no. You can’t avoid contributing to CEO bonuses _in general_ unless you go live in a cave. ---
**Author:** ![Pleonast](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pleonast/32/1183_2.png) [@Pleonast](https://boards.straightdope.com/u/Pleonast)\ **Post date:** [March 23, 2011, 5:54pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/23 "2011-03-23T17:54:04Z")
It comes down to supply and demand. They supply of labor, at all skill and education levels, has been increasing faster than the demand for it. The opening up of China and other developing countries is where the supply is coming from. Eventually the people there will begin demanding more goods and services for themselves and the demand for labor will start outpacing the supply. A side effect of this is that global inequality has been decreasing (I don’t have a cite handy, but I probably read it in _The Economist_). All those people in developing countries are getting closer now in income and wealth to the people in developed countries. This is a good thing, both from a moral standpoint and an economic one. Less inequality is good in its own right, of course; looking at inequality within a single country when we have a global economy is parochial. The reduced inequality means there are more opportunities to trade to the developing countries and increases the size of the total economic pie. ---
**Author:** ![bump](https://avatars.discourse-cdn.com/v4/letter/b/7c8e57/32.png) [@bump](https://boards.straightdope.com/u/bump)\ **Post date:** [March 23, 2011, 6:08pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/24 "2011-03-23T18:08:36Z")
> [@Wesley\_Clark](#): > > I think automation and the labor surplus affects skilled labor too. There is an oversupply of lawyers, scientists, IT professionals, etc. Plus there is an international market of people willing to do those jobs for a fraction of the cost. > > As far as the financial industry paying well due to a shortage of talented workers, I really don’t know if I agree with that. Incomes shot up starting in the 70s in the financial industry, as far as I can tell the level of talent did not skyrocket to meet it. I have no idea why income in that field has gone up, but I’m sure there is more to the story than that. I don’t think it’s so much a supply and demand thing as far as compensation is concerned- it’s more with the value that employees add. By that, I mean that with equal availability, a highly trained accountant brings more to Wal-Mart than a night stock boy does, and consequently, the accountant will be paid more. It’s more of a concept of looking at employees as investments- you get a bigger ROI on paying more for better/more valuable employees, so you’re willing to pay more for them. Obviously, there’s a sweet-spot of sorts, which is why companies don’t pay big money often for kids straight out of college, and nor do they often hire late-career people; Supply and demand do play into it- the ROI is raised in conditions of scarcity, and lowered in situations of plenty, but not drastically. I think this is because the lower pay jobs are also typically more interchangeable. Even in situations where there are labor shortages in certain employment sectors, nobody’s paying 50k a year for stock boys- they could just as easily hire a cashier or movie theater clerk in need of a job and easily train him to be a stock boy. You can’t really do that with accountants, lawyers, etc… I think that excessive bonuses and really high pay are included in this- I’d bet that financial firms are like law firms, where most private sector lawyers don’t make 100 grand a year, but almost all are still “well paid.” The bigger firms pay more, because they can, and because they can use it as a recruiting tool of sorts- many lawyers’ first choice is a big firm like say… Baker Botts because they pay well, and they don’t want to work for Huckster, Shyster & Mountebank LLC down the street, because they’re 1/16 the size of Baker Botts and don’t pay as well. So Baker Botts gets to cherry pick out of law school and out of the already working population. It’s an attempt to get the highest ROI they can- if they get what they perceive to be the best lawyers, they can bill more hours and get more cases, due to their performance. The billing rates of law firms are exorbitant, so it’s not like it cuts into their profit margins to pay so much. ---
**Author:** ![smiling\_bandit](https://avatars.discourse-cdn.com/v4/letter/s/e9a140/32.png) [@smiling\_bandit](https://boards.straightdope.com/u/smiling_bandit)\ **Post date:** [March 23, 2011, 6:25pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/25 "2011-03-23T18:25:45Z")
> [@Wesley\_Clark](#): > > Both sides make a sacrifice. Ok, WC, I’m just cutting you off except for this point. You’re confusing pain with risk. The two are not the same. The entrepreneur and the investors face risk. Workers face the possibility of being paid off. But they cannot lose anything on the deal. It isn’t risk. You can deal with that however you like, but the fact is that capital and capital risk is always a major constraint; labor is only sometimes a constraint. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [March 23, 2011, 6:28pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/26 "2011-03-23T18:28:03Z")
Capital privatized the marketplace of ideas. The media is no longer a neutral voice. Television, radio, newspapers, magazines, and book publishers are dominated by a handful of big corporations. Sure, there are independent media that offer alternative choices but they’re small and easy to miss - nobody hears what they have to say unless they go looking for it. The majority of people just hear the corporate voice. There doesn’t have to be any active censorship. The media can take idea off the public agenda just by ignoring them. Talk about choices A and B and people are going to think those are the only two choices and not realize there might be a C or D or Z. ---
**Author:** ![Whack-a-Mole](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/whack-a-mole/32/141_2.png) [@Whack-a-Mole](https://boards.straightdope.com/u/Whack-a-Mole)\ **Post date:** [March 23, 2011, 6:42pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/27 "2011-03-23T18:42:47Z")
> [@Pleonast](#): > > A side effect of this is that global inequality has been decreasing (I don’t have a cite handy, but I probably read it in _The Economist_). All those people in developing countries are getting closer now in income and wealth to the people in developed countries. This is a good thing, both from a moral standpoint and an economic one. Less inequality is good in its own right, of course; looking at inequality within a single country when we have a global economy is parochial. The reduced inequality means there are more opportunities to trade to the developing countries and increases the size of the total economic pie. A rising tide lifts all ships theory? Well, not really. Not sure what you read but if the measure is world GDP has grown therefore everyone is better off is bogus. By every measure I have read inequality is increasing globally as measured among individuals. The haves have more and more of the pie and the have-nots are still in pretty shitty conditions. Crumbs from the table do not mitigate this. It’d be like you handing some starving person a spoon and then declaring they are better off than they were. > [@](#): > > Notice, too, that if one were to make conclusions about “true” U.S. inequality based on the first two concepts, one would be led to believe that inequality in 1989 was less than in 1959. The reverse is true: in 1989, inequality was four Gini points (or 11 percent) higher than thirty years ago. > > SOURCE: [http://press.princeton.edu/chapters/s7946.html](http://press.princeton.edu/chapters/s7946.html) (too much to quote but the article notes the other two methods which are measures of GDP and notes how they are misleading) > [@](#): > > # While global GNP grew 40 percent between 1970 and 1985 (suggesting widening prosperity), the number of poor grew by 17 percent. > > # Although 200 million people saw their incomes fall between 1965 and 1980, more than 1 billion people experienced a drop from 1980 to 1993. > > # UNDP reported in 1996 that 100 countries were worse off than 15 years ago. > > # Adjusting for inflation, the net worth of the median American household fell 10 percent between 1989 and 1997, declining from $54,600 to $49,900. The net worth of the top one percent is now 2.4 times the combined wealth of the poorest 80 percent. > > # Between 1983 and 1995, the bottom 40 percent of households lost 80 percent of their net worth. The middle fifth lost 11 percent. By 1995, 18.5 percent of households had zero or negative net worth (an average -$5,600, down from -$3,000 in 1983). > > SOURCE: [http://www.globalpolicy.org/component/content/article/218/46377.html](http://www.globalpolicy.org/component/content/article/218/46377.html) ---
**Author:** ![Pleonast](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pleonast/32/1183_2.png) [@Pleonast](https://boards.straightdope.com/u/Pleonast)\ **Post date:** [March 23, 2011, 8:42pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/28 "2011-03-23T20:42:12Z")
> [@Whack-a-Mole](#): > > By every measure I have read inequality is increasing globally as measured among individuals. The haves have more and more of the pie and the have-nots are still in pretty shitty conditions. Crumbs from the table do not mitigate this. It’d be like you handing some starving person a spoon and then declaring they are better off than they were. Your cites show the problem with trying to make global generalizations from poorly selected subsets of the data. A can’t find what I originally read, but this paper, [Parametric estimations of the world distribution of income](http://www.voxeu.org/index.php?q=node/4508) shows that the global Gini coefficient has been steadily decreasing since 1970 (see figure 3). As has the number of people in the world with an adjusted income below $1 per day (figure 4). So globally, people are doing better now, both in terms of relative and absolute wealth (as measured by Gini coefficient and the $1 per day rate). Of course, that doesn’t directly help the people in regions (like the US) where inequality is increasing, but it does mean things have been getting for most people. ---
**Author:** ![Nobody](https://avatars.discourse-cdn.com/v4/letter/n/94ad74/32.png) [@Nobody](https://boards.straightdope.com/u/Nobody)\ **Post date:** [March 24, 2011, 12:09am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/29 "2011-03-24T00:09:07Z")
> [@bump](#): > > However, once the unions go from trying to make things decent for the workers, and move into the adversarial and greedy side of things, that’s when they actively hurt companies. There’s a lot of “shoot the goose who laid the golden egg” going on, when unions refuse to negotiate with distressed companies- surely a pay cut or a pay freeze is better than no pay at all? I couldn’t agree more with this. Years ago I use to hate unions because I would read stories about totally lopsided deals where employees would get massive pay no virtually no work, or be inflexible about one thing or another. But due to a couple of things, one being, there’s horror stories about corporations exploiting their employees, but that doesn’t make all corporations bad, just like unions with unreasonable demands doesn’t mean all unions are bad. ---
**Author:** ![emacknight](https://avatars.discourse-cdn.com/v4/letter/e/3ec8ea/32.png) [@emacknight](https://boards.straightdope.com/u/emacknight)\ **Post date:** [March 24, 2011, 12:15am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/30 "2011-03-24T00:15:13Z")
> [@septimus](#): > > One of the most important explanations is being overlooked here. > > Income sources include workers, and the rent of land and owned capital. In a primitive society the human workers themselves comprised most of the wealth; a semi-skilled worker in a village of 100 might expect to get 1/100 of the income. But with increasing industrialization, more and more of the total wealth takes the form of invested capital, scarce land, and very skilled specialist workers. It is straightforward to conclude that unskilled laborers “deserve” far less than their proportional share. That was extremely well said. It’s weird to consider that workers are sharing their wealth with the machines they use. ---
**Author:** ![Nobody](https://avatars.discourse-cdn.com/v4/letter/n/94ad74/32.png) [@Nobody](https://boards.straightdope.com/u/Nobody)\ **Post date:** [March 24, 2011, 12:31am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/31 "2011-03-24T00:31:15Z")
Slight hijack, but in there labor threads it seems that sometimes the low level employees are looked down upon. So I just have to say that when it comes to front-line jobs, don’t forget that they’re necessary. All companies that I know of only has one CEO. There are more presidents and other executive positions, but there’s still a limited number. Not everybody can be an executive director or plant manager. Somebody has to work the assembly line, or man the cash register. Sure, for some people it’s their fault that they don’t go higher up the ladder, but even if everybody got their Masters degree or Ph.D., there would still be low level jobs that would need filling. And the view that the employee is just an expense baffles me. The employee is doing the work that generates the profit. Theoretically anyway, if someone is employed by a business, it must be because they are needed by the business (yes, there are exceptions). If I invest in a pizza shop, but have nobody to make and serve the pizzas or nobody to work the cash register I have no business. The pizza makers give a reason for people to fork over their money, and the cashier gives them a way to do it. If there’s no pizzas to buy, or no way to pay, I’ll have no customers. And I agree that the easier a job is to do, the less it’s worth. But it almost seems like there are some who view the investor as a god, and the employee as something that has to be put up with. And with that I totally disagree. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [March 24, 2011, 12:40am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/32 "2011-03-24T00:40:33Z")
> [@Nobody](#): > > Slight hijack, but in there labor threads it seems that sometimes the low level employees are looked down upon. So I just have to say that when it comes to front-line jobs, don’t forget that they’re necessary. > > All companies that I know of only has one CEO. There are more presidents and other executive positions, but there’s still a limited number. Not everybody can be an executive director or plant manager. Somebody has to work the assembly line, or man the cash register. > > Sure, for some people it’s their fault that they don’t go higher up the ladder, but even if everybody got their Masters degree or Ph.D., there would still be low level jobs that would need filling. > > And the view that the employee is just an expense baffles me. The employee is doing the work that generates the profit. Theoretically anyway, if someone is employed by a business, it must be because they are needed by the business (yes, there are exceptions). If I invest in a pizza shop, but have nobody to make and serve the pizzas or nobody to work the cash register I have no business. The pizza makers give a reason for people to fork over their money, and the cashier gives them a way to do it. If there’s no pizzas to buy, or no way to pay, I’ll have no customers. > > And I agree that the easier a job is to do, the less it’s worth. But it almost seems like there are some who view the investor as a god, and the employee as something that has to be put up with. And with that I totally disagree. My impression is in the past labor could demand higher wages and benefits or better treatment, but now they can’t. I figure that is just due to the fact that labor has lost most of its power to intimidate or negotiate with investors because labor can easily replaced or undercut while investors cannot be intimidated or undercut. And I don’t see that stopping anytime soon. And as a member of labor who has to find a way to financially survive, that is bothersome. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [March 24, 2011, 2:15am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/33 "2011-03-24T02:15:47Z")
> [@Nobody](#): > > Slight hijack, but in there labor threads it seems that sometimes the low level employees are looked down upon. So I just have to say that when it comes to front-line jobs, don’t forget that they’re necessary. > > All companies that I know of only has one CEO. There are more presidents and other executive positions, but there’s still a limited number. Not everybody can be an executive director or plant manager. Somebody has to work the assembly line, or man the cash register. > > Sure, for some people it’s their fault that they don’t go higher up the ladder, but even if everybody got their Masters degree or Ph.D., there would still be low level jobs that would need filling. > > And the view that the employee is just an expense baffles me. The employee is doing the work that generates the profit. Theoretically anyway, if someone is employed by a business, it must be because they are needed by the business (yes, there are exceptions). If I invest in a pizza shop, but have nobody to make and serve the pizzas or nobody to work the cash register I have no business. The pizza makers give a reason for people to fork over their money, and the cashier gives them a way to do it. If there’s no pizzas to buy, or no way to pay, I’ll have no customers. > > And I agree that the easier a job is to do, the less it’s worth. But it almost seems like there are some who view the investor as a god, and the employee as something that has to be put up with. And with that I totally disagree. It depends on the type of employee. A highly skilled chef is worth a great deal to a pizza place. The waitresses and busboys are pretty replaceable. The employees are generating the work, but the work only generates a profit if the value of the work they produce exceeds their cost as employees. If you pay your entire staff twice as much, can you really cover the costs by doubling the price of your pizza? ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [March 24, 2011, 2:33am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/34 "2011-03-24T02:33:54Z")
> [@emacknight](#): > > That was extremely well said. > > It’s weird to consider that workers are sharing their wealth with the machines they use. I have never seen a machine draw a salary or buy a TV. ---
**Author:** ![Nobody](https://avatars.discourse-cdn.com/v4/letter/n/94ad74/32.png) [@Nobody](https://boards.straightdope.com/u/Nobody)\ **Post date:** [March 24, 2011, 2:47am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/35 "2011-03-24T02:47:55Z")
> [@Wesley\_Clark](#): > > My impression is in the past labor could demand higher wages and benefits or better treatment, but now they can’t. I figure that is just due to the fact that labor has lost most of its power to intimidate or negotiate with investors because labor can easily replaced or undercut while investors cannot be intimidated or undercut. And I don’t see that stopping anytime soon. And as a member of labor who has to find a way to financially survive, that is bothersome. Investors want to cut costs and maximize profits. The two biggest way to do that with labor costs is automation and outsourcing. Each of these have their ups and downs of course. For example, it’s a good thing when dangerous jobs are automated. And for outsourcing, it can have a good effect on helping to lift up poor countries, say India. On the other hand, why pay for an American programmer when you can pay an Indian programer 60% less? Automation, you can do nothing about, and frankly, I don’t think it’s all that bad. As for outsourcing, my only hope is that soon wages will be roughly equal so it won’t be as cost effective to outsource. Of course, that’s not counting countries that are cheaper to operate in because of things like looser environmental regulations. And frankly, for the demise of unions, I’m sorry, but part of the blame has to go to them. When people hear about things like no cross training allowed, so that, for example, a job in a Japanese owned auto plant can be done by one person, but it takes five people in an American plant, because the contract specifies that each employee is responsible for one thing, and one thing only, and they can’t do anybody else’s job; That’s ridiculous. Of course there are outside factors too, and politicians who try to union bust whenever they can, but big powerful unions who at times aren’t reasonable don’t help their own case any. ---
**Author:** ![Nobody](https://avatars.discourse-cdn.com/v4/letter/n/94ad74/32.png) [@Nobody](https://boards.straightdope.com/u/Nobody)\ **Post date:** [March 24, 2011, 3:10am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/36 "2011-03-24T03:10:54Z")
> [@msmith537](#): > > It depends on the type of employee. A highly skilled chef is worth a great deal to a pizza place. The waitresses and busboys are pretty replaceable. > > The employees are generating the work, but the work only generates a profit if the value of the work they produce exceeds their cost as employees. If you pay your entire staff twice as much, can you really cover the costs by doubling the price of your pizza? > [@Nobody](#): > > And I agree that the easier a job is to do, the less it’s worth. \_\_ ---
**Author:** ![smiling\_bandit](https://avatars.discourse-cdn.com/v4/letter/s/e9a140/32.png) [@smiling\_bandit](https://boards.straightdope.com/u/smiling_bandit)\ **Post date:** [March 24, 2011, 3:23am UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/37 "2011-03-24T03:23:40Z")
> [@Wesley\_Clark](#): > > My impression is in the past labor could demand higher wages and benefits or better treatment, but now they can’t. That’s not exactly true. During the 50’s, a relatively limited labor supply and a lot of overseas demand led to very high wages for workers, even more than the traditionally-high American labor costs. But it wasn’t forever. It didn’t and couldn’t last. It was strange from the start. What’s interesting is that apart from some big, government-supported unions (such as the UAW, which got the gov to lean heavily on the Big Three), union influence was actually _falling_. The heyday of unions belonged to the earlier 1900-1930’s. The union system then tended to support decentralization, negotiation, and a certain amount of reason. But it’s important to understand that the older system was created by specific personalities, and its good traits weren’t necessarily communicable to a new generation. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [March 24, 2011, 4:55pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/38 "2011-03-24T16:55:53Z")
> [@msmith537](#): > > Where do you think those resources come from? The income generated by the application of labor to capital. > [@](#): > > No. Yes. > [@](#): > > All businesses typically need both labor and capital. Businesses don’t exist to employ people. They exist to make money by selling goods and services. Labor is a cost that companies strive to minimize so they can earn a greater profit. Labor earns a wage in exchange for the product of their labor. The wealth produced (profit) is split at the discretion of the owners - the people who invested their capital and seek to see a return on their investment. Over the last 30 years the GDP has shot up and the productivity of labor has also shot up. The overwhelming portion of that increase in productivity has gone to capital and those who manage capital for the capitalists. I thought the OP was asking why there has been such a one sided division of the increases in productivity over the last few decades. Certainly one answer is the supply of labor has increased both with the flattening of the world and the increased participation of women into the work force. But another facet is that we have increasingly started to view labor as merely production inputs rather than as the constituents of a society. We forget that of all the economic systems out there, we judge the success of that system based on its effects on the people in that society. > [@](#): > > The difference between labor and investors/owners is that labor does not incur any risk. At worst, they loose their source of income. Investors and owners can conceivable be worse off because they can loose all the money they put into the company. So having no income is not a risk? ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [March 24, 2011, 5:03pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/39 "2011-03-24T17:03:46Z")
> [@Whack-a-Mole](#): > > ETA: I also might add I thought it was Negotiating 101 that you do not start out reasonable. You demand $1 million for your loaf of bread, the other side says they need it for free and you work towards a compromise. Thats a good way to get people not to negotiate with you. Noone negotiates with a pig. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [March 24, 2011, 5:24pm UTC](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656/40 "2011-03-24T17:24:51Z")
> [@bump](#): > > I don’t think it’s so much a supply and demand thing as far as compensation is concerned- it’s more with the value that employees add. By that, I mean that with equal availability, a highly trained accountant brings more to Wal-Mart than a night stock boy does, and consequently, the accountant will be paid more. It’s more of a concept of looking at employees as investments- you get a bigger ROI on paying more for better/more valuable employees, so you’re willing to pay more for them. Please explain the disparity between pay for American CEOs and European or Asian CEOs. Its structural not value based. The labor market is one of the most inefficient markets in the economy [Previous page](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656.md?page=1) [Next page](https://boards.straightdope.com/t/why-has-so-much-power-influence-left-labor-and-gone-to-capital-at-least-in-the-us/575656.md?page=3)