People are paid based on how much a similarly skilled worker is willing to work for, not based on how much value they generate for a company.

They are paid between their value and what they are willing to work for. Where exactly in between depends on supply and demand. When demand is high, competition will drive the salary close to the value generated. When demand is low, cost cutting and unemployment will drive the salary towards the minimum price.

They are paid based on how much other companies are willing to pay the same worker.

Why should an engineer be paid that value they produce when they assume none of the risk? If the company goes bankrupt, will the engineer be willing to bail the company out?

The engineer is paid less than the value they produce because they don't assume any of the risk. If the product they produce turns out to be worthless or break, they don't have to pay their salary back.

> Why should an engineer be paid that value they produce when they assume none of the risk?

Engineers are never fired? Not even when the company shuts down?

> If the company goes bankrupt, will the engineer be willing to bail the company out?

Sometimes yes, with their (and mine) taxes.

> Engineers are never fired? Not even when the company shuts down?

Engineers never lose assets because their work doesn't produce value, or destroys value. Engineers aren't liable for the success of their work. Engineers don't have to return their salary if they don't produce value.

> Sometimes yes, with their (and mine) taxes.

This is an argument for everyone capturing the value produced by companies, not the employee. If you want to argue for harder taxation of corporations, or fewer business incentives, then sure. But this is unrelated to the relationship between the engineer and the company.

The value generated is an interesting number when the company is hemorrhaging money...

How many engineers are able to directly convert their work into a revenue number? It's not like a Sales job where there are ever increasing targets and money coming in is recorded meticulously.

Would you pay $300 for an item costing $150 if you use the item to make something more than $300 of value?

Didn't think so.

Why should the internet cost orders of magnitude less than the value it generates?

Nobody is paid exactly what they're worth, because what would be the point? The company can break even like that by not hiring anybody.