We must first consider the purpose of money and the purpose of employment. Money's purpose is to allow distribution of credit based on the amount of value that an individual or other entity has provided to society. Employment's purpose, in the broader sense of the term, is to allow an individual to provide services to society while expecting fair compensation in return. By "fair", I mean not unbalanced like slavery, where slaves indeed were compensated (with food and shelter) but not in a manner commensurate with their production.

Perhaps the biggest problem with common understanding on the topic of value is that people fail to distinguish not only how much value an entity produces but also what type of value an entity produces (or doesn't produce). If I buy a bank repo house for $50k and sell it for $250k after doing essentially nothing but posting some pictures and descriptions of the place Online, then the only value I actually created is in the pictures, descriptions, and paperwork that I did. Say I spent 30 hours doing all these tasks. Then say the average person would agree that a fair pay rate for this type of work (papers, pictures, descriptions, and some phone calls) is $50/hour. The real value that I would have created would thus be 30x50, or $1500. Yet the sale of this property would net me at least $180k, after any expenses. Note the difference between value created (<$2k) and net gain ($180k).

The problem here is the discrepancy between value created and money "earned". It seems that a large portion of society is okay with this discrepancy. For example, many people see nothing wrong with gambling or Lottery, despite both involving accumulation and distribution of money without any value being created. Until the majority of society agrees that people shouldn't be paid more than the value they personally create, we can expect extreme income inequality to exist and persist. If ever society can change its mind on this matter, we might expect the following:

1. There is an income cap, based on the realistic maximum amount of value that a human can create. The actual value is based on scientific investigation into the amount of value (not money, but actual value to society) created by the smartest and most skilled humans. The cap would be somewhere in the ball park of this maximum value (perhaps a little higher, just for good measure). For example, I am willing to bet that a human is not capable of creating more than 100x that of the average (median) human in terms of real value. Every time we look at a scientific advancement of the past, we see that although person X came up with the idea first (and hence usually got all the credit for it), there were a bunch of other people working on the same idea, many of which only a handful of years behind X. Not only that, but the person usually was in the right place and right time, with the right connections, to achieve what he or she did. If you took random other persons and put them into that exact same situation, many would have accomplished a similar feat. Certain discoveries were meant to happen around certain times.

2. All now known and future known types of exploitation are prohibited. Any accumulation of wealth where the person gaining the wealth is not producing significant real value is outlawed. Such accumulation of wealth is deemed to be in the same category as counterfeiting since it funnels money from the actual producers to someone else. Examples such as the real-estate investor described above would be eliminated by government programs whose purpose is to deal with such situations as bank repo properties in a responsible and production-centric manner.

3. There are well-funded government programs whose purpose is to facilitate relocation of individuals currently working in non-productive positions into positions that make a positive difference for society. These programs are optional for these individuals, but nevertheless any non-productive positions are phased out of society.

4. Inheritance is capped at half of one lifetime's worth of median income (based on society in general). Hence, if the average person makes $6M in his or her lifetime, then $3M would be the maximum allowed by anyone to be passed on to any heirs. Remember: The goal is to promote productive individuals, so we cannot have people born into a life that doesn't require being productive.

I'm sure a bunch more changes would be needed for the best result, but the above may serve as food for thought.