The Ten To One Rule

Think for a moment what it would mean to you to make twice as much in wages as you are making now. Imagine what you would be willing to do to make that happen. If you’re like most of us, it probably wouldn’t be possible to double the amount of work you’re already doing or the amount of hours you are already working. You’re probably already working about as hard and long as you’re able. But put aside the reality that there’s no way you could earn twice as much and focus on what you could do with that money. I know I would have a lot nicer car and probably a much nicer house as well. And while we’re fantasizing, think for a minute what you could do if you were making three times as much as you are now. Then your wife—if you have one—wouldn’t have to work and could stay home with the children if she wanted. Plus of course, you’d still be able to afford that nice car and bigger house. And of course, if you were making four times what you are making now, you could have all of the above and retire a hell of a lot earlier than you would otherwise. Face it, you’re probably scared at the prospect of retiring as it is, wondering if you will ever be able to afford it.

It’s fun, isn’t it, to dream of life if we were making many times more money than we are now. Say, for example, five times as much you are making now. Why, with that amount you could have that cabin on the lake you’ve always wanted, along with a couple of fine boats to go along with your early retirement, idle wife, new car and bigger house. But why stop there, let’s indulge this fantasy further. At six times your current salary you could have all of the above as well as be able to take your family and friends to Hawaii or another vacation of your choosing. Every year! At seven times your salary, you could give your real current salary away to a good charity. At eight times, you could do all of the above and make a giant pile of cash and build a big fire with it. At nine times, you could eat out every single day of the year, get a pedicure once a week, hire a personal trainer, and buy a pony yearly. And at ten times your current salary you could…oh, I don’t know, I’m sure you could find a way to spend it.

I like to daydream like everyone else, but I’m trying to make a point with all of this. The point is this: even doubling your income would change your life in many ways, and increasing it five-fold would make you achieve just about all of your material goals. If you were to manage your money at that point, you would do very well indeed. By the time you got to ten times your salary, you’d have to start looking for ways to spend it, or else to save it, therefore ending up with even more money than you know what to do with.

And there is my point, that ten times your salary is not only as much but more than you will ever need. And if you have doubts about that, get your head out of the clouds and think about the fact that you will likely have to find a way to be happy with one-tenth of that in real life. That is reality for 95% of us.

That is my point, but my proposal is this: we should make it a law or at least a very strong suggestion that no business leader should make more than ten times the salary of the lowest paid employer. Perhaps making it a law would be too hard to oversee, but we should definitely make it an expectation for those who run businesses. This does not put a cap on a CEO’s earnings, it merely states that the money should be spread around a little more fairly. While I am perhaps not the most productive person at my work, I can guarantee you nobody works ten times as hard or ten times as much or is ten times smarter than I am, or any combination of the above. I’m willing to bet the same about most of you, too.

This will still allow the CEOs to compete with other CEOs as to who has the biggest salary, since at some point that’s what it boils down to for them anyway, one colossal power game. It’s just that they wouldn’t be able to smash those below them down quite as far, that’s all. It would keep some sort of perspective on the whole system, saying that any one person is no better than any other ten people. To be honest, I appreciate the people who clean the toilettes at my work a lot more than I do any of the executives, and it’s a lot easier to tell when they are doing a bad job. Heck, I’m feeling generous, so let’s make it a fifteen to one ratio. That’s still a lot better than what exists at many companies. I feel this is a very modest proposal. What say all of you?