Unfortunately this is the reality:
Many companies are so large with so many subsidiaries or locations that they can operate with slim margins or at a loss at many locations, which keeps them strong and drives out competition, but it also means they may be operating within a small percentage of failure. Example: if a corporation sells a million units at $10 then they have $10 million in revenue. If their operational costs are $9.50 per item then they only made $0.50 per unit or $500,000 in profit, which may not be enough to have money to invest to stay competitive or provide the owners with enough money to make the effort worthwhile, so they need to actually raise the price to $12, so they have $2.5 million in profit. A large, multi-national competitor sells 100 million units of the same product at $9.10, severally undercutting the other guy. Their operational costs are only $9.00 per unit because of efficiencies of scale, which the smaller competitor can't match. Their revenue is $910 million, and their operational costs are just $900 million, such that their profit is $10 million. This means the owner has more money in his pockets and more money to continue investing in the corporation. It also means if the operational costs unexpectedly go up because a commodity like rubber or oil goes up, and the price isn't adjusted proportionally, the big corporation could be in the red, so they decide to hire some top CEOs to make sure they are always in the green, but that costs them a million in profit. No biggie. The owner is still making a lot of money, especially compared to his rival, who is having a hard time selling even the million units priced so much higher than the large corporation. Eventually, his business sells to the large corporation or goes under. And the cycle continues.
As the profits roll in, the corporation has extra profit, so what does it do? Well, it can reinvest and develop. It can grow and expand. It can pay bonuses to those CEOs to retain their "expertise", but they don't "trickle the money down" to the average worker because those workers are expendable and easily replaceable.
https://www.marketwatch.com/story/it...ays-2019-09-30
According to this article, it would take a thousand years for the average employee to match the wages of the average CEO for one year in the top 50 worst wage gap corporations. Sometimes this is exasperated by the fact that these CEOs are in the US, but the workers are in Mexico or China. Sometimes it is just a sad reality of the structure. If you have 10,000 workers then you can give the CEO a bonus of $10 million to retain that high demand CEO, or you can give the expendable workers $1,000 each. And, that is the culture we live in. With Walmart having 2.2 million employees, they either pay the ten CEOs $10 million a piece at $100 million, or they pay the 2.2 million employees $45 a piece. If they reduced these CEOs salaries to say $500,000 then that wouldn't do much for the average employee. Even if that means $100 million goes back into worker's salaries then we are talking $45 payout or about $0.02 per hour raise. Obviously, it is easier for the business to pay out a bonus to the CEOs when they have a green year because they will see a real increase in salary, where the employees might be able to go out for a steak dinner once. They can't even raise the salaries by $0.02 per hour because the next year they may not be in the green if they do.
As we can see, the problem is that when business get large they operate at such tight margins that they are capable of still making millions or billions, but are still operating on the edge, so they squeeze their employees and inflate their CEOs' salaries. Add in the need to keep growing for investors, and the basic employee just gets abused.
I don't really have a solution for this. I think more business, regardless of how little it may be, should be offering their employees a profit sharing option, so that the business doesn't have to commit to larger salaries, but if there is a profit then all employees will see a bonus. Rich people won't whine about having to pay taxes, if they don't ever get such a huge salary or bonus to begin with. If we create a situation where a corporation can not have such a huge gap between their top earners and their average salary then they might distribute shares of the profits more equitably amongst their employees. If they violate the cap then maybe they pay a tax penalty or something. I don't know. I feel like there are other solutions besides tax solutions like antitrust laws. Clearly, the average family isn't benefiting from buying cheap crap from Walmart like economists want us to believe.