Private Enforcement Mechanisms

Anna Chu explains the importance of a recent Delaware Supreme Court decision.

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idea light bulbExit polling from the election shows that voters are frustrated with Washington’s infighting, political gridlock, and inability to solve the nation’s problems. However, Americans are not waiting for the impasse in Washington to solve itself: They are increasingly taking matters into their own hands through state ballot initiatives and private litigation.

An example of this direct action is the effort to tackle the problem of stagnant wages through state ballot initiatives. Although Senate Republicans blocked efforts to raise the minimum wage nationally in April, Americans took action at the state level. Nine states have passed a minimum-wage increase this year, and voters in five states—including four deep-red states—approved ballot initiatives to raise the minimum wage.

While raising workers’ wages addresses part of the income inequality problem, it does not address the skyrocketing pay of those already at the top. This is perhaps best personified by runaway executive compensation. In 2013, the average pay for the CEOs of the nation’s top 350 companies was 300 times that of average workers. This ratio is more than 10 times higher than it was in 1965, when CEOs made 20 times that of the average worker.

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