Socialism: decide pay in the open, with the lower-paid protected

Add pay.md: pay bands open to every worker, a ratio each co-op must choose and measure honestly, a double majority for high pay and for raises to jobs most members hold, and no one voting alone on their own pay. Stop the reserve rule from charging co-ops for raising the bottom, and close its gaps for perks, non-members and related companies. Co-Authored-By: Claude Opus 5.5 <[email protected]> Claude-Session: https://claude.ai/code/session_01QWPs69B8nQZjtPEUXMKzZx
2026-09-24 05:59:02 -06:00
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@@ -66,9 +66,10 @@ That leaves four ways the horizon problem can still get in.
 **1. The reserve's share applies to pay above the going rate, too.** This isn't a cap on wages. Members can pay themselves whatever they decide. But the reserve takes its 30% of everything members receive above the going rate, whether it's called profit or pay.

 - **The going rate for each job** is the higher of two numbers: the median pay for that occupation in the co-op's own metro area, from the government's wage survey (the Bureau of Labor Statistics' [Occupational Employment and Wage Statistics](https://www.bls.gov/oes/)), or the local living wage for a full-time worker supporting one child, from [MIT's Living Wage Calculator](https://livingwage.mit.edu/). The living-wage floor matters. In home care the median wage can be close to poverty pay, and a co-op that raises its aides to a living wage shouldn't owe anything for doing it.
- **It's checked job by job.** Paying one group below the going rate doesn't make room to pay another group above it. The co-op's auditor assigns each job its occupation code from what the person actually does, not from their title.
- **It counts total pay.** Employer retirement contributions above 6% of pay, bonuses, and severance beyond the co-op's standard formula all count as pay. Co-ops can't promise pensions or retiree benefits they don't pay for in full each year.
- **How it's settled.** Thirty percent of the excess is moved from members' [capital accounts](capital-accounts.md) into the reserve. No new cash has to be found, because the members already took that money as pay. If a member's account can't cover it, the rest comes out of their future account credits.
+- **Raising the bottom is free.** Pay up to one and a half times the local living wage never counts as above the going rate, so a co-op that lifts its lowest-paid well past a living wage owes the reserve nothing for it.
+- **It's checked job by job.** Paying one group below the going rate doesn't make room to pay another group above it. An outside reviewer, the co-op's auditor or the bank's, assigns each job its occupation code from what the person actually does, not from their title, and the codes are shown to members next to each job. Where the survey has no figure for the metro area, the state figure is used, then the national one.
+- **It counts total pay.** Employer retirement contributions above 6% of pay, bonuses, severance beyond the co-op's standard formula, and perks like a car, housing or loans to members, valued at cost, all count as pay. So does pay to non-members and to people working through a related company. Co-ops can't promise pensions or retiree benefits they don't pay for in full each year.
+- **How it's settled.** Thirty percent of the excess is moved from members' [capital accounts](capital-accounts.md) into the reserve. No new cash has to be found, because the members already took that money as pay. If a member's account can't cover it, the rest comes out of their future account credits, or out of their payout when they leave. For pay to non-members, it comes out of that year's members' profit pool.
 - **There's a precedent.** US tax law already treats salaries that aren't "reasonable" as disguised profit ([26 U.S.C. § 162(a)(1)](https://www.law.cornell.edu/uscode/text/26/162)), so owners can't dodge tax by calling profit pay. This rule stops the same disguise being used to dodge the reserve. The tax test is judged case by case. This one is a fixed formula, so it's cruder but much harder to argue about.

 **2. Gains from selling assets go to the reserve.** If a co-op sells a building, equipment, a brand or a patent for more than its value on the books, the whole gain goes to the reserve, not into the profit split. A sale to an insider, or a sale-and-lease-back, is checked like any [insider deal](pilot-safeguards.md#the-hidden-boss).