All over the morning press, and the buzz in morning email traffic: the SEC is slated to adopt today a disclosure rule requiring larger domestic public companies to disclose the ratio of the compensation of their CEO to the median earnings of all employees.

It has been so long under discussion that I had to go back to the books to recall the exact statutory mandate for this new rule.  It is the Dodd Frank Act of 2010.  It took the SEC five years to swallow hard and adopt this meaningless rule.  The SEC tried to address added disclosure cost by allowing estimates and statistical samplings, which no doubt will help, although one can imagine the boring written disclosure explaining the statistical methodology.

The statutory requirement for this rule goes back to the fall-out from the 2008-9 crash.  But since public shareholders get to vote (albeit in nonbinding fashion) on CEO comp under the “say on pay” rule, and since proxy advisers have gotten much more granular with recommendations based on specific analysis, it is hard to understand the functionality of new rule.

And more importantly, the rule is useless.  CEO comp is market driven and the comparables are other C-suite executives.  That has nothing to do with the median pay of, say, a company with employees around the world, who may be paid $10 as a robust daily wage in a place where bread is a dime a loaf.  And more importantly, to the extent the rule is designed to control through shame, higher comp is rather a CEO badge of pride.  The psychology is simplistic and wrong.

The real solutions to growth of income disparity, to the extent one views the current situation with disfavor, are more fundamental and politically charged: change the minimum wage; change the tax rate; ultimately take the wholly un-American, anti-free-enterprise step of an absolute C-suite pay cap.   At least today,these solutions range from unlikely to, well, unimaginable.

In the Stone Age when I got to college, the Federal marginal tax rate (under a Republican administration) was 91%.  All those in favor of the good old days, raise your hands….