If that is the case and companies are over-valued as a result, then the idiot investor who puts such high faith in that type of valuation will be left penniless on the trading floor. Free markets will still correct this. Companies pay big bucks for executives because that is the going rate, not because of some other false government intervention such as propping up their wages. They get that pay because that is what the market will bear.
The bottom line is that everyone is paid exactly what they are worth until the government interferes. If a worker is worth more than what they are being paid, they should find an employer who agrees with that assessment. If they can't find one, perhaps their self-evaluation is overestimated. I like the idea of people collectively bargaining for better pay as that is their right. Unfortunately, workers are, at the same time, too dumb to reign in those same unions so as not to be excessively greedy.
I think the union system is flawed, a better way to protect workers would be for them to buy the company themselves. If this was more common of a practice, I suspect that these employee-owned companies would probably have slightly higher pay. This would force the competition to raise employee wages if they wanted to get the same level of employee.
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