Posted on 09/06/2010 6:10:06 AM PDT by SeekAndFind
One of the most startling things about the post-crisis landscape is how tone-deaf the wealthiest Americans remain to outrage over their Croesus-like pay packages. The award for complete obliviousness would have to go to Blackstone cofounder Stephen Schwarzman, who earlier this summer compared government attempts to raise taxes on financiers such as himself to Hitler’s invasion of Poland. Silver medals should certainly be handed out to the many executives and corporate lawyers who were grousing last week about the new Dodd-Frank bill, which includes a rule requiring companies to disclose the difference in pay between their chief executive and their lowest-level workers. It would be a “logistical nightmare,” these titans of industry wailed, for firms to compile this information.
Well, maybe, but if you issue pay stubs, surely you can tally them up (and perhaps keep a few more workers on board to do just that). The real nightmare will be when the public sees the numbers, which will illuminate just how egregious the U.S. pay gap has become. According to the Institute for Policy Studies, a liberal think tank based in Washington, the average S&P 500 CEO takes home 263 times what his cheapest laborer does. While CEO pay is indeed down from its pre-crisis highs in 2007, it’s still double what it was in the 1990s, and eight times the level in the 1950s.
(Excerpt) Read more at newsweek.com ...
The author cited management guru Peter Drucker.
I remember Drucker noting that after CEO-to-worker pay ratios went above 25–1,especially during turbulent times, major moral questions started to be raised.
What’s striking is that the executives who are the most willing to ax workers also seem to be the least likely to tighten their own belts.
How much for the DEO of Washington Post?
What do the stockholders have to say about this? Are these CEOs worth the money, or not?
Look at Newsweek trying to puff up these two clods. The Dodd-Frank bill. BS. Dodd and Frank should both be behind bars right now. Although I'm sure Frank would prefer it.
and where is all the stimulas..we have people getting stimulas in our area working illegals...we have the plants in our area woking illegals...we got companies from out of town tearing up good sidewalk to pour new( using illegals)and ramps to nowhere. we got a city charging triple for to cover a filtration system they got grants to build. We have a forestry that turned of state land to a private company who is working illegals. And now we have out of state farming and nursery growers advertising here for workers(has to be for illegals) in a ranching area.I am not in a border state....I am in little Mexico, OKlahoma
As one of America’s CEO’s, I can testify that my pockets are not only not stuffed, but August was the one of the worst months in the companies history.
Newsweak is just mad that ANYONE is making money, since they obviously CANNOT.
While the MSM has a cow about CEOs of major billion dollar corporations making big bucks why is no one concerned about the mega million salaries paid to professional athletes or TV and movie stars? Shouldn’t the CEO of Microsoft or GE be compensated for the value they brings to their companies every but as much as say LeBrun James or Brett Farve? Is Oprah Whinfrey more deserving of all the money she makes than the CEO of a fortune 500 company? Why should Tom Cruise be paid millions for making a movie that bombs at the box office?
How much are you paying yourself to Freep? :-)
None of this is the government's business. The Left is trying to build an emotional demand for more government control. At least they have yet to say women and children are hurt the most. Once this gets rolling in the media too many people will casually accept the governments role in all that. After all, they set a minimum wage, working conditions, safety regulations and even determine who can be hired and fired to a large degree. Regulating the pay gap between CEO and lowest responsibility is just a natural follow up.
RE: What do the stockholders have to say about this? Are these CEOs worth the money, or not?
Judging from how the stock markets have been performing lately ( and even the past decade ), I would say they are NOT.
What the class warfare clowns at Progressive Fascists propaganda outlets like News-weak never tell you is the bulk of the CEO’s pay is stock options. When the company is doing well, and people are flocking to invest in them, they make their big money.
Really a sad and pathetic commentary on the US Education system when people, supposedly “Conservative” in political outlook, start buying into the Progressive Fascist's notion that a job is a birthright. That simply by being born, you are some how entitled to a good paying job no matter if the job your are doing is actually producing any value for anyone.
And what moral questions did Mr. Drucker raise about that? Fairness?
What’s striking is that the executives who are the most willing to ax workers also seem to be the least likely to tighten their own belts.
I haven't noticed that but even if it is true, so what? Once the workers are axed the CEO still has the responsibility for a profitable operation. If he can operate profitably with fewer workers then the workers weren't needed to begin with.
Once again I see class envy in your posts.
RE: Shouldn’t the CEO of Microsoft or GE be compensated for the value they brings to their companies every but as much as say LeBrun James or Brett Farve?
Lebron James brought a team that was hugging the cellar to the playoffs several times in 7 years. What has the CEO of GE brought to shareholders lately ? What have Citigroup, Bank of America and a host of others given to shareholders that justify their fat bonuses?
Barack Obama collects $5 million in royalties on his books. No one complains.
John Kerry buys a new yacht and stores it out of state to avoid property taxes. That’s OK.
The Kennedy family owns multiple homes and the trust fund seems immune to inheritance taxes, continuing to support multiple generations of wealthy liberal activists. No one proposing taking their wealth away.
Professional athletes and Hollywood stars make millions enjoying lavish lifestyles and engaging in all sorts of immoral behaviors. No one in the press is envious of their fame and fortune.
Politicians go to Washington with limited means (Bill Clinton, Lyndon Johnson) and accumulate massive wealth on modest salaries while “serving the public”. No one in the media begrudges them of their good fortune.
Billionaires such as Buffett and Gates complain about taxes being too low on the wealthy, but they never seem to be able to write a check giving the government one cent more than their legions of accountants and tax lawyers tell them is the minimum they need to pay. Hypocrites? No way!
Yet if a person goes to work in the private sector and attains wealth by risking his own savings on an entrepreneurial venture or climbing the corporate ladder that individual is disdained as a filthy money grubbing exploitive capitalist undeserving of any of his/her income or possessions.
Isn’t America a great place to be?
RE: Once again I see class envy in your posts.
Let’s take an analogy to sports...
If I question whether a player A in team X is worth his salary compared to Player B in team Y due to the value they give to their team, is this class envy or is this a legitimate question based on what we observe in terms of team and individual performance?
Player A gets paid $10 Million per season but his team languishes in his league while player B gets paid $5 Million but his team consistently makes the playoffs. Is asking whether player A deserves his $10 M class envy ?
A CEO gets a fat bonus even as his company’s profits drops and he has to lay off thousands, do they deserve it?
The author makes the observation that, While the corporate world has certainly gotten more complex over the last 50 years, it’s hard to make the case that CEOs themselves have gotten any smarter, or that investors are doing a better job of judging a CEO’s success.
Compensation levels are all too often driven by short-term thinking.
The CEOs of the 50 firms that laid off the most workers since the onset of the economic crisis took home 42 percent more pay in 2009 than their peers did—largely because cutting workers boosts short-term profits and appeals to stock speculators.
Yet, the question remain — does downsizing always lead to increased profitability over the longer haul, or even lower costs. There are many reasons for this, ranging from the fact that companies going into layoff mode often lose their best workers to competitors, to the toll taken on R&D spending, which is what produces the revenue and growth potential of the future.
So, it is not always about class envy. It is asking a very relevant question regarding a CEO’s WORTH.
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