Why aren’t they screaming about Julia Roberts making $20 MILLION for ONE stinking MOVIE???
(no offense, Julia - just using you for an example)
Hollywood is FULL of numbskulls making HUUUUUUUUUGE money for ‘acting’ in the crap it turns out for us. Why does nobody care about THEIR ‘obscene’ profits???
And this, coming from the obama administration... Hey barack, just exactly how did YOU become a millionaire back in Chicago, huh??? -From community ORGANIZING? Please explain THAT one??
The reason the salaries and other pay of actors and athletes does not garner outrage, while that of corporate managers does (and rightly so, though why I feel this as an advocate of free-market capitalism requires a bit of explanation), is that actors and athletes are 1. not deciding on each other’s pay packages and 2. not being paid as fiduciaries for other peoples’ interests and property.
Corporate managers including CEO’s, CFO’s and boards of directors are supposed to follow the example of the old robber baron Jay Gould, whom the left loves to vilify for saying “The public be d*mned”, leaving off the rest of his reply, “I work for my stockholders.” When compensation packages cease to be tied to delivering value to shareholders, or protecting shareholder value in downturns, managers are being paid for something other than doing their jobs.
However envious we might be of actors and athletes pay, they are being paid to act and to play some sport at an exceptional level. Bonuses paid to managers who have misjudged the market, driven their company’s share price through the floor, or even contrived to make the bonus triggers something too far removed from shareholder value to meaningfully correlate with it, are bad for capitalism because they are bad for the capitalists. Remember the capitalists? The folks who put their money at risk in the market in hope of getting a good return? Now days, that’s most of us by way of pension funds, IRAs, 401(k)’s, mutual funds, or simply direct investment in stocks.
Unfortunately since most shares in most companies are now voted by institutional investors (mutual funds, other corporations, pension funds) managers vote on managers pay packages, and they are easily persuaded to vote in the interest of management even when it’s against the interests of the shareholder whose interest *they* are being paid to look out for.
The professional manageriate is the Western version of Djilas’s New Class, whether they are in business, the non-profit sector (e.g. university administrators), or government (and the same people often float between all three spheres). Obama is one of them—he worked with Bill Ayers to manage a worthless education project in Chicago, probably the most substantial job he held before he rose to his level of incompetence as a legislator. So are his entire cabinet, so was Kenneth Lay of Enron infamy, and the management of all the failed banks and bailed-out banks, and of GM and Chrysler both before and after the government take-over, and on and on.
The problem we have is that we have an economic system with the form of capitalism, but except for small businesses, by and large, it is no longer controlled by the capitalists.
It is natural that at least a large segment of the manageriate would embrace Obama’s fascism. A fascist organization of the economy and the state gives the managerial class nearly complete power.
I think the realization of this at an intuitive level is what is driving the Tea Party movement, which is mainly directed against Washington, but unlike most right of center movements also has an animus toward Wall Street. (As well it should under the present circumstances.)