Calculate Your Own Pay If You Were a CEO!

AFLCIO ^ | January 22, 2002 | AFLCIO/parsifal

[parsifal]

Recently I have been involved in several threads dealing with minimum wages, fair wages, and taxes on the wealthy. Somehow, even though I am pretty "conservative", I manage to be on the opposite side of most freepers on these issues.

So, for fun, and for a view of the "other" side, I present some links to the AFLCIO website.

Calculate your pay if your were a CEO

There are other fun things on the site. Browse around here and play the "Greed" game:

CEO Paywatch and "Greed" Game

And if you are interested in "living wages" and have some questions:

FAQs About Living Wages

[1L]

I think big business is darn near as bad as big gov't.

Absurd. Companies are totally beholden to their customers and shareholders. Lousy service = no customers (except for government); poor performance = low stock price and little incentive for more capital investment (except for government); idiotic decision making by companies can lead to shareholder derivative suits (can't do that to the govt.), bankruptcy, and failure (govt. keeps on printing and spending). In addition -- take Enron -- criminal behavior means criminal penalties. Ted Kennedy and Bill Clinton haven't served a day in jail, though they both belong there.

I think the people should be allowed to sue big companies.

Ahhh, they are! As a defense attorney, I can testify to that. I have cases on my desk from big companies getting sued -- mostly for stupid and illegitimate reasons. Go try and sue a govt. entity.

I think minimum wages should be up around $8.00.

This is way too low. Minimum wage should be $1000 a day. Don't you think? If not, how did you come up with $8 and why do you think that will work? Further, what will happen when those adhering to the $8 an hour stop giving raises and the current $11 an hour folks have to take a pay cut (which WILL happen)?

I think most businessmen share the same mental make-up as criminals and welfare-recipients.

This is just stupid. I know plenty of businessmen (and women) and I know a few too many criminals. Neither have anything in common.

I am not so sure the rich are being taxed too much,

Then you aren't paying attention.

and indeed, tend to think they ought to be taxed more.

How much more? Why? Wouldn't a lower tax rate allow them to pay employees more -- perhaps that $8 an hour you want?

I think there should be a 100% estate tax for most rich folks.

This is the most stupid thing you've said. How do you define rich? Why should a person be ordered to give to the government something he or she has worked his whole life for? DUDE: IT AIN'T YOUR MONEY.

I am not torqued out by homos, blacks, and poor folks. etc. parsy.

I'd be willing to bet they are "torqued out" (whatever that means) by you!

[conservative cat]

I think you can see that my biggest criticisms of corporate leaders have more to do with issues of patriotism than with issues of personal compensation.

I completely agree with you. I don't believe in estate taxes or even really minimum wage, but I believe that corporations should have more loyalty to the country that made their existance possible.

[purereason]

"Why should there be a "100% estate tax for most rich folks," and what do you mean by "most?" IMHO, I am beginning to think it better to not create a class of rich, spoilt entitled great grandkids. If Bob has enough get up and go to make millions, good for hi, Good for his kids. But somewhere along the line, I think Bob's influence needs to end. He's dead. Buried and turned to worms. There's a whole new group of people on the planet and they don't need Bob's dead hands controlling and having an influence on things. (I am still trying to develop this theory of mine.) parsy."

Suggest you research the Ottoman Empire. When a person died, their wealth reverted to the state.

[Henrietta]

No one is this country is "forced" to pay anyone anything (unless you want to count fines levied by the government.) You cannot force someone to work for what the employee believes in an unjust wage; if they think it's unjust, they go work somewhere else, or start their own businesses. Indeed, no one is forced to work at all; welfare is an all-too-easy option; the legions of welfare moms are a testament to that. Duress and unconscionablity have nothing whatever to do with this discussion.

[CubicleGuy]

Hey, isn't it comforting to know that the contents of a CEO's brain, and his (or her) capacity for being a more efficient worker (by a factor of 10 or 20 or more!), makes him or her worthy of the scads and tons of money that the Board of Directors chooses to throw at him or her?

We can't go about just giving these types of jobs to just anybody, you know. Standards must be maintained. These people must be capable of projecting the image that these big corporations feel is representative of their goodness, propriety and morality. Can you imagine the scandal that might follow should it be discovered that the President of some big corporation actually enjoyed bowling, for goshsake? Nobody would be able to take that company seriously ever again.

[Night Hides Not]

It is fruitless for you and everybody else to win a debate with Parsifal. Why? Because he admitted he is a lawyer. I know of no lawyer that could ever pass Economics 101, i.e. the law of supply and demand.

Lawyers do not produce anything of value to the general public. Yes, they're good for settling a dispute from time to time. However, for the most part, the only thing they care about is their time - what can they get for each billable hour. I marvel at the bills my boss receives from her attorneys. It seems like 75% of their time is spent on the phone 'consulting'.

As a CPA, I must admit that I don't produce much more than your average attorney. My value to my company and my clients is that I know how to minimize the heavy burden that our government places on our productivity, and profitability.

I laughed at parsifal's analysis of the minimum wage, and how he defines 'reasonable'. The 'market', for better or worse, will always be the best arbiter of what is 'reasonable'. For example, the minimum wage is hardly a factor in the D/FW Metroplex, despite the recession. McDonald's still advertises a starting wage of 'up to $8', so it's likely that their more experienced staff makes over that. Why? Because they are more efficient, and therefore more profitable than when they started...they are more valuable to their company, just like a law firm partner being more valuable to the firm than a new associate.

I'd be willing to bet that parsifal's law firm pays AS LITTLE AS POSSIBLE for their clerical and administrative help. Nothing wrong with that, except that the shoe is now on the other foot.

[purereason]

"You cannot force someone to work for what the employee believes in an unjust wage; if they think it's unjust, they go work somewhere else, or start their own businesses."

Not unless they want to move about in our "free" society. That is unless they want to purchase a drivers license (and buy the required insurance), Park their car, get to government controlled water, even use a rest room at some locations, etc.

Get real, government (and the powers behind it-the people with the bread) control our very lives to an unimaginal extent.

I have no say about the salaries of the CEO's whose stock I might hold.

As an corporate(or criminal) attorney it is all right to support your client's position, so long as you don't start believing it?

[1L]

It is fruitless for you and everybody else to win a debate with Parsifal. Why? Because he admitted he is a lawyer. I know of no lawyer that could ever pass Economics 101, i.e. the law of supply and demand.

Don't let your dislike for Parsifal make you make dumb comments. I am a lawyer, and I not only passed Econ 101 (actually, 1301, I think) I have an Economics degree and a graduate class in Mathmatical Economics.

Lawyers do not produce anything of value to the general public.

Hmmm. I hope I don't think about those comments when I am arguing the overturn of Roe v. Wade to the Supreme Court. Or the correct interpretation of the First Amendment religion clauses. Or am ON the SC (imagine that!) making competent (well, arguably) rulings.

[Mr. Jeeves]

Hank Rearden weighs in:

"I work for nothing but my own profit - which I make by selling a product they need to men who are willing and able to buy it. I do not produce it for their benefit at the expense of mine, and they do not buy it for my benefit at the expense of theirs; I do not sacrifice my interests to them nor do they sacrifice theirs to me; we deal as equals by mutual consent to mutual advantage - and I am proud of every penny that I have earned in this manner. I am rich and I am proud of every penny I own. I made my money by my own effort, in free exchange and through the voluntary consent of every man I dealt with - voluntary consent of those who employed me when I started, the voluntary consent of those who work for me now, the voluntary consent of those who buy my product. I shall answer all the questions you are afraid to ask me openly. Do I wish to pay my workers more than their services are worth to me? I do not. Do I wish to sell my product for less than my customers are willing to pay me? I do not. Do I wish to sell it at a loss or give it away? I do not. If this is evil, do whatever you please about me, according to whatever standards you hold. These are mine. I am earning my own living, as every honest man must. I refuse to accept as guilt the fact of my own existence and the fact that I must work in order to support it. I refuse to accept as guilt the fact that I am able to do it better than most people - the fact that my work is of greater value than the work of my neighbours and that more men are willing to pay me. I refuse to apologise for my ability - I refuse to apologise for my success - I refuse to apologise for my money. If this is evil, make the most of it. If this is what the public finds harmful to its interests, let the public destroy me. This is my code - and I will accept no other. I could say to you that I have done more good for my fellow men than you can ever hope to accomplish - but I will not say it, because I do not seek the good of others as a sanction for my right to exist, nor do I recognise the good of others as a justification for their seizure of my property or their destruction of my life. I will not say that the good of others was the purpose of my work - my own good was my purpose, and I despise the man who surrenders his. I could say to you that you do not serve the public good - that nobody's good can be achieved at the price of human sacrifices - that when you violate the rights of one man, you have violated the right of all, and a public of rightless creatures is doomed to destruction. I could say to you that you will and can achieve nothing but universal devastation - as any looter must, when he runs out of victims. I could say it, but I won't. It is not your particular policy that I challenge, but your moral premise. If it were true that men could achieve their good by means of turning some men into sacrificial animals, and I were asked to immolate myself for the sake of creatures who wanted to survive at the price of my blood, if I were asked to serve the interests of society apart from, above and against my own - I would refuse. I would reject it as the most contemptible evil, I would fight it with every power I possess, I would fight the whole of mankind, if one minute were all I could last before I were murdered, I would fight in the full confidence of the justice of my battle and of a living being's right to exist. Let there be no misunderstanding about me. If it is now the belief of my fellow men, who call themselves the public, that their good requires victims, then I say: The public good be damned, I will have no part of it!"

-- Ayn Rand, Atlas Shrugged

[Night Hides Not]

Ok, Ok, for YOU (and other true constitutionalists), I'll be happy to make an exception. Sorry, I've had to deal with too many attorneys over the past two years.

Like any profession, mine included, there are those few bad apples that spoil the barrel.

Glad to hear there's at least one attorney that passed Economics! There's hope for our great country! ;^)

[parsifal]

Thank you for sticking up for the legal profession! Am getting some info for you now on the other reply. parsy.

[Night Hides Not]

My apologies to all of you lawyers that have passed Economics 101 (any accredited Economics course for that matter).

Upon reviewing my comments, I can see where they could be misconstrued.

For any other attorney who thinks that we should mandate a 'living wage' or 100% estate taxes on the 'wealthy', the above apology does not apply to you! Where's the fairness in the heavy hand of government forcibly taking away all of your assets when you die, when you spent your life working hard, PAYING TAXES, so that you could leave that estate to whomever you wanted to?

Anybody who harbors that notion is no different than a doctor who practices abortion or euthanasia. Just because it's legal, doesn't mean that it's right!

Oh my! Richard Cohen used the 'legal vs. right' argument regarding Enron yesterday! AAAAAAAIIIIIIIIYYYYYYYYEEEEEEEE!!!!!!

The Flame Room is back open for business...I think I need to take a breather...whew!

[parsifal]

Re the criminals and businessmen connection:

Antisocial Personality Disorder

Antisocial Personality Disorder, as it is currently defined in DSM-IV, is a broad concept encompassing a variety of situations with differing implications regarding treatment, long-term outcome, and legal consequences. Several important dimensions need to be considered. Persons with Anti-Social Personality Disorder [ASPD] can vary, for example, from the mild to the severe, from early-onset to adult onset, from violent to non-violent, and from those with low scores on Psychopathy [as defined by Robert Hare's "Psychopathy Checklist-Revised" -- the "PCL-R"] to those with high scores.

At the mildest end of the spectrum, there are mild, non-violent, adult-onset, low PCL-R scoring persons who blend into the normal population as shady [zwielichtig] businessmen and politicians. At the severest end, we confront the cold, violent psychopath, as exemplified by serial killers, rapists, kidnappers who harm their victims, etc.

[parsifal]

"For any other attorney who thinks that we should mandate a 'living wage' or 100% estate taxes on the 'wealthy', the above apology does not apply to you! "

parsifal is a "Knight who hides not" also!! FWIW, I do know a wee bit about business. My undergrad degree was in Business Mgt. I was an Samurai Zen-Master Accountant for years. I was once an office manager for a CPA firm. I did all the hard stuff the CPA's couldn't figure out. (I recall once when they dumped a tax client on me who had just sold four very profitable businesses. He was adamant about keeping his taxes down. I got him a refund. Legally.) I quit there and started my own accounting service. I got tired of whining small businessmen who wanted something for nothing and thought they were too good to pay taxes. So I went to work as a controller for a transportation and construction company.

I got to do all the firing because I had no moral qualms about it. Once I laughed in the face of a truckdriver who brought his aged momma and small children to my office to demand/beg for his paycheck. It was about a week before Christmas and the guy had tapped off an oil-line so he could boogy on in to town. He ruined the engine and I told him to jump in the lake for his paycheck. I wasn't paying him squat. His kids cried. His momma cried. He cried. The little kiddies would have no Santa Claus this year, he pled. Bah Humbug I said and threw him out of my office. (real tender-hearted, ain't I.)

After some financial difficulties (no fault of mine), I went back to school and got my degree. Then I started law school. And yes, I know numbers. And you want to know how I spent my day, today? I figgered out a way for one of our corporate clients to screw their employees. I told their lawyer that we would probably both die and go to hell, but if we did "x", it would benfit the client. The other attorney agreed. It's legal. Five out of nine Supreme Court justices said it was. But its morally wrong IMHO, and one day I will have to explain to Jesus why I did it and explain to him how lawyers have to do what is in the best interests of their clients. Jesus will not like it, but he will understand.

So, yes. I know what numbers are. I know how businesses work. You really ought to listen. parsy.

[parsifal]

You may not be able to force them, but most people have to work. They have house notes, car notes, kids that need to eat,etc. Even judges realize that employment is often a "take it or leave it" proposition. People may "voluntarily" got to work for someone, but that doesn't make the wage "equitable." The law don't like peonage. pasy.

[parsifal]

"Okay, suppose the govenment sets the minimum wage to $8, like you suggest. That means that the crappiest workers get paid $8 per hour. Now, say you own a business and want a worker who has skills and can do things. Would you offer $8 per hour for a skilled worker, when the unskilled workers get paid that? No, because all your competition is offering $10 per hour for those same skilled workers, because there aren't that many skilled workers, so in order to hire them away from someone else, they have to pay more. Now, of course, the managers have to be paid more..."

Thank you for saying this! You hit the nail on the head. Now re-read what you wrote. Notice that the "new" wages don't reflect "economic recompense for productivity"--It is based instead on keeping people in their proper social class. I have been saying thru several threads that wages are not the 100% result of the laws of economics, but partly due to intangible factors like greed and class consciousness. Thank you for admitting it for the other Randite freepers. parsy. (grinning. grinning.)

[IWONDR]

"Anyone can find examples of CEO's raking in large bucks while their companies spiral down the crapper, but those are the exception rather than the rule (and also indicative of incredibly stupid or weak Boards of Directors)."

I believe just the opposite. In fact, how many average joes get golden parachutes when the company store really hits the skids. These people come in getting enormous salaries, bonuses, stock options, mortgage buy downs, free insurance, etc. etc., then if things go sour under their exalted "leadership," they just bail, after having laid off beaucoup numbers of worker bees who end up on the dole.

[RightOnline]

You think they just give those things for the hell of it? Do you really think that the average corporation / board of directors are so stupid? WHY do you think they get such packages?

It's because there just aren't too many people who CAN run a major corporation. That's a fact. It takes a unique skill set to successfully run such an organization, and the MARKET sets their value (remember supply and demand? Lots of demand, damned short supply of such qualified people.)

It just floors me the number of people here on FR who appear to be so naive about business.

[Henrietta]

Notice that the "new" wages don't reflect "economic recompense for productivity"--It is based instead on keeping people in their proper social class.

No, the new wages DO indeed reflect economic recompense for productivity. When the government artificially raises the minimum wage, it drives up other wages too. Skilled workers are worth more than unskilled workers because they have SKILLS. This is axiomatic.

Skills have nothing to do with social class. If a person is a poor member of the underclass, and through education and hard work acquires skills, he will not be paid less because of his lower-class origins. If someone offered this person less than the prevailing wage (set by the market) he would (ceteris paribus) choose to work instead for an employer who offers him the prevailing wage. Employers can't afford to be discriminatory with regard to social class; they just want someone who can do the job.

[parsifal]

That's a nice theory but I have seen a whole lot different scenario played out. I call it the Perceived Social Class Wage Expectancy Theory. (PSCWET) By my theory, employees within an organization are paid on a hierarchial basis according to their perceived class. The secretary is a lower middle class worker and paid accordingly. The forklift guy is upper lower class and will be paid less. The CEO is upper upper, and should be able to drive a Cadillac. This is true even if the line worker produces more income.

Put my theory to the test. Let a receptionist in a small firm drive a new Cadillac to work. When the managers see it, let her tell them she saved her money and has been investing. It will cause no end of distress at the company. The hierarchy has been upset. see Jung, Carl. Theory of Archetypes. parsy