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.
I responded specifically to this and I asked you which moral issues were in play? You chose to shift the point to economics rather than morals. I don't disagree with you or Drucker on the economics but I am interested in the concept of morality in business as far as pay differences go.
As far as your sports analogy is concerned, doesn't the quarterback make more than anyone else on most teams? Why?