Every time I read about this kind of indecent fiscal inequality, I can't help but think of the Russian and French revolutions. At a certain point, the majority had had enough and the minority lost their heads. I'm not advocating for such actions, but it would be wise for the uber wealthy to read up on class warfare. Ya know, to put a few things into perspective.
5
Back in the 1950's USA, the ratio between top executive compensation and median wage was less than 80 times. The ratios are still that low in other well-functioning, socially responsible market economies such as Japan and Sweden.
So how did the USA get here? For half a century we have been pulling down the New Deal and grubbing for unrestricted market economy. (Witness the Supreme Court ruling that made it even more difficult for workers to unit in arbitration.)
The debate between command economies (USSR) and market economies (USA) is long gone, but the debate between "virtually unrestricted" market economy (GOP) and "socially responsible" market economy (Democrats) continues.
Vote, my friends, vote!
1
The boards are 100 percent responsible for this. It is done to mask their own inflated salaries, stock options, perks and fees which the bury in the fine print of prospectuses and proxies. Flashy CEO's come and go, but the directors are long-term. With a highly visible CEO in the crosshairs, board members are safe in near-anonymity. Interlocking directorates, while difficult to unravel and not as glamorous as their CEOs, are the root cause of the epidemic of greed at the top.
1
If all the CEOs disappeared tomorrow, their companies would still keep running. The CEO and top executives are so far removed from the actual buying and selling of the services and products that pay their salary. What would bring many companies to a grinding halt is if all the lower level employees decided not to show up for a few wks. Thats where the revolution is. Stop going to work, stop paying your bills, mortgage, car payment. No one will come after you because they didn’t go to work either. Then we will have their attention. Nothing else will ever work.
6
We need a much more steeply progressive and higher marginal tax rates for the top 5% of income earners. For every $50,000 of income over, say, $250,000 (earned by 5% of the U.S. population) the marginal tax rate should, for example, be increased by 5% peaking at 95%. In addition, capital gains should arguably be taxed at the same rate as earned income.
The surplus thus generated could be used to repair, maintain and improve our much neglected infrastructure (thus generating jobs as well as increasing productivity) and provide adequate health care, retirement income, education and housing for the many who lack it under our current income distribution, while reducing the national debt.
5
Shame on them! Such unbridled greed. Yet it is the board of directors that need to be singled out, they approve this. Why are shareholders outraged, doesn’t this take away from profits.
2
Note the New York Times has avoided reporting on their ratio due to a legal evasion of proxy rules. Seems the pot is calling is calling the kettle black.
This is the core of our problems. It is criminal that we have this disparity of wealth. We need to heavily tax the super rich and distribute the money to those in need until every family and individual has a decent home, health care, food, education. Capitalism has failed. We need to look to a socialist model.
1
I remember the brilliance of sociology professor E. Digby Baltzell who taught his classroom of mostly Wharton students that the merit system was both an incentive system and a system of social and economic control. It is the people at the top who decide who gets hired and who gets promoted. By its nature it is consciously and unconsciously rigged to drive the economy forward while preserving social and economic stability. The problem to him was not the system so much as the myth that the winners were so superior to everyone else that they deserved as much of the pie as they wanted while the losers were inferior human beings.
5
Most working people work hard. I never understood the disparity between those at the top and those at the bottom. I'm all for top Executives being paid fairly, and handsomely Those in the Company that do theitr share of the heavy lifting be paid fairly too. Back in the 90's when many companies were downsizing and closing factories those at the top were getting huge bonuses this behavior is wrong. This is where Capitalism goes wrong.
5
Somewhere in this value set is the idea that the more wealth a person has the more superior some feel they are to other human beings; the idea that those who have less...are less. Sadly, too many people buy it. The myth of meritocracy and the myth of superior races and classes.
18
A welcome article on a topic that needs frequent, illustrative coverage. Another way to pose the comparison featured in the first paragraph of the article is equally stark--and perhaps even easier to imagine:
To earn a $100,000 annual salary (48 weeks of work per year) Wal-Mart Median guy must work almost 5 years. McMillon must work just over 2 weeks. In a word, criminal.
20
THAT'S why knowing how to schmooze with the big guys is so much more valuable a skill than being able to stock shelves.
2
Good read! The NYT should consider a follow-up piece focused on healthcare examining the “spread” between the most highly renumerated New York City hospital executives and the physicians providing hands on patient care - who actually are directly involved in the delivery of health care. Particularly for the debt-laden junior faculty / young physicians, the salary gap is astronomical, and shameful.
16
I think Boards of Directors have been grossly negligent to let CEO pay get this far out of hand. I don’t care who they are, no human is worth what they’re getting paid. If the skies parted and Jesus returned to earth with and MBA and a briefcase I wouldn’t pay him that kind of money.
2
I've been reading articles about obscene pay gaps between CEOs and their employees for the past 30 years. Nice to keep reminding us, but A) doesn't seem like this is really news B) doesn't seem like anything will change
3
This is revolting. But where are the revolts?
1
In 1980 I made $16/hr. as a temporary secretary: it was a point of honor for men not to know how to type, and new-fangled word processors were a mystery to the extant secretarial staff. My apartment was $340/month.
Now? Office staff wages have scarcely budged, but rents have increased 10-fold, as has student loan debt. Lifelong service to a company by a worker that culminates in a gold watch and a decent pension no longer exists, but executives get golden parachutes worth many lifetimes of a living wage when they “move on.”
Is America’s moral compass so broken that money is the only way to keep score, and her imagination so bereft that we can’t come up with a better way?
4
This article is non-sense and has an aim to divide people.
First, Chief Executive Officers' compensation is tied to bonuses, stocks, options not just cash. So what today is 20m tomorrow can be 10m or 30m, while options may be worth 0.
Second, Chief Executive Officers were good students and later worked very hard (intellectually) to get where they are now. It's all market - this is USA after all - nobody would pay them that much if they didn't deserve it.
And why this article targets only CEOs? Why singers, actors and basketball players earn so much? They probably deserve it. Though, in my opinion they deserve it much less then someone who actually has a lot of responsibility over important things, moves the economy forward and create new jobs.
Not to say that CEO does it alone, but through her/his experience, knowledge, hard work, risk taking and responsibility taking does in fact quite a lot.
Take Walmart, CEO of a company that has 1.5 millions employees? You think that's simple work? Why aren't you that person then? Then go to supermarket and see those cashiers many of them incapable of doing even that work decently.
1
This comment is non-sense and has an aim to divide people.
I'm not the smartest person in the world, but many people think I'm pretty smart. I'm not the hardest-working either but, over a forty-year career ending as a non-profit executive, I was usually credited with an exceptional work ethic.
Do you really think I should agree that these CEOs' efforts were worth hundreds or even thousands of times my own? Are they hundreds of times smarter? Did they work a thousand times as hard?
I suppose they should be well-paid, but these rates of compensation are absurd. Ultimately they are unsustainable. Even you must realize that.
5
Is ATP #1 in tennis hundreds of times better than average tennis player? Does the best basketball player works thousand times more than average basketball player?
I don't care if these thieves are rich. They can have their expensive homes and yachts and wives and clubs. What they cannot have is our government. They do have it however and they are useing it to steal everything else. They own the House and Senate and our poor indebted President. Also they don't just consist of American thieves. Thieves from all over the world are buying our govenment. Open your eyes Lu11 before its too late. Assuming its not already.
As a former presidential candidate once said, "what difference does it make?" It is a useful question. If the typical CEO's total compensation was divided equally among all the employees, each would receive (at most) a few hundred spendable dollars and some unspendable stock and stock options. So what difference would it make to the rank and file, other than salve jealously? Of course, most of the employees couldn't do the CEO's job, so the apples-to-oranges comparisons are irrelevant, so what positive difference would it make? And the CEO's money isn't kept in a mattress: it is invested, saved and even spent, activities that provide employment. So what difference would it make?
Comsider the situation in reference to the salary of the President of the U.S.A. Who has the more significant job? Why do a board of directors deem a CEO so much more valuable?
1
"At Morgan Stanley, for example...the company’s chief executive received a 16 percent pay rise."
Seriously, folks, when was the last time you personally received a 16% pay raise in one year, regardless of how hard you worked or how profitable your company was?
And why so many outraged Comments criticizing the NYT for reporting the compensation packages of billionaire CEOs? Many of our fellow Americans, our fellow human beings, including little children, live in dire poverty with, literally, raw sewage flooding their yards because they cannot afford a decent septic system. But silly me - I forgot - this is the land of Ayn Rand Republicans so only the already successful & already massively wealthy people in this country "deserve" government assistance.
7
Let's see if our political leaders will stop blaming Asia for stealing our manufacturing jobs, the ones not yet lost to automation, and start placing the blame where it lies.
Here in the US, we have a belief that people should have safe working conditions, overtime for extra hours worked, and a living wage. Here in the US, we don't often hear about sweatshops. US corporations have mostly given up on operating sweatshops in the US, and are operating them by proxy in other countries.
US corporations are supporting this system that, while defying our beliefs in how workers should be treated, also ensures US labor sources can't possibly compete. Meanwhile, US corporate CEOs, shareholders, etc., have never made more money.
NFL, Trump admin, et all, THIS is what it means to be disrespectful and unpatriotic.
1
The CEO's are making infinitely more money then they and their families can ever spend and the lower paid employees especially the lowest cannot earn enough to save. Doesn't this effect our economy negatively? How can this be changed either by legislation, taxation, or management?
3
And did these moguls also benefit from the GOP tax cuts?
Mr. Gelles becomes the latest journalist to tie himself in knots trying to pretend that meaningless "pay ratio" contains useful information. He claims that companies are "revealing" the ratio, as if they had calculated the statistic in the past but concealed it. He then coins a new oxymoron: "predictably striking".
We already know that CEO pay is high because it is disclosed each year. The pay ratio calculation required by Dodd Frank is a waste of resources and should be acknowledged as such.
Why do ridiculously rich people strive to make even more money? Here's the answer: The money is also going to their families, and these families will be wealthy and influential for at least several generations.
Let's hope the individuals in these families are wise and not selfish, and if so, perhaps it will be for the best. What this data really shows is not that the average American worker is underpaid. It shows how much better an individual born here lives than an equally qualified individual in another country, and this difference is unsustainable.
Yes, executive compensation is out of line. However, American worker compensation is also out of line, and unless we do something to end our complacency and build a culture in which education and skills are taken to a higher level, we will continue on a downward economic path.
1
orate profit and individual wealth.Many take issue with the idea that an individual born here lives better that same in another country. Generally European workers live with much better benefits than american worker - healthcare, higher education, childcare, vacation time, maternal and paternal leave, and on.Their societies set priorities for general good of society.
I am pleased to observe that author David Gelles avoided (for the most part) a common usage error. He cites that this CEO or that "was paid", "received", "was awarded" or "was compensated" a certain number of millions of dollars. He avoids saying that they earned it. Earning these sums is impossible since no individual's contribution to a business enterprise could possibly be worth thousands of times the contributions of others.
It would be interesting to devise a corporate tax instrument that was keyed to this ratio. Awarding extravagant compensation to executives is clearly not damaging the corporation's competitiveness in the eyes of its board members. They should then be able to bear a greater tax burden.
3
Enough is enough. It is time to penalize companies that cannot support executive work effort that justifies compensation.
1
Imagine your 401K if you work for 275 years!
The way 401ks are going, probably still not that great.
1
Okay, so you won't match your CEO, but still a great benefit if you have access to it.
If you are still *gainfully* employed, I'd suggest you max it out with company match. While I was working, I didn't have many years of opportunity (I was a temp most of the time) but I was distressed to see my full time colleagues who didn't take advantage of their generous benefit.
CEOs say they make the high value decisions and so deserve high compensation. Yet the success of companies depends on the details of how their products and services are executed just as much as whether a merger is executed or a division is realigned. CEOs are admin experts deserving of expert pay like the other experts in their companies. The fact they pull off this heist has to do with them sitting on each others boards and having the authority to set and protect their own compensation.
Occasionally a CEO is a founder and perhaps defined a business idea. Even so, execution by experts contibutes 10,000 equally valuable and unique ideas to the company success for the one the founder expressed. Wildly disproportionate rewards for founders are also there because they deny the truth of who creates what, and exploit ownership concepts to say the value created by employees is actually value created by them.
This is all the more true where tech is required to create products. Practically all employees are making decisions that can make or break the bottom line and thus act as experts.
The concentration of stock is what to cap. And maybe start outsourcing top executive admin jobs so theres competition from equally skilled people who will accept less.
2
These observations of course simply don't apply to the Federal Government: as aCivil Servant, you may make the same salary as your boss (or even more), and the difference between the top earner and the median is almost negligible in many department of the government. Perhaps that is another reason Republicans hate the Federal Government so much, and despise the Civil Service, in particular, so deeply.
1
This is exactly how an oligarchy is supposed to work, so I do not understand what all the fuss is about. America has been heading in this direction for many years, and Citizens' United ruling seemed to ensure this. And now we have elected (I use the term loosely) a billionaire businessman to the Presidency and what exactly did anyone expect out of that? There is aboslutely no reason anyone paying attention to Trump and the Republican platform should expect anything different from the further establishment of the oligarchal ruling class in America. If you really believed this crowd is doing things in the interest of the common man, well sorry to burst yer bubble....
5
“More equitable DISTRIBUTION of wealth” is the favored phrase to avoid the link between individuals contributions and the CREATION of wealth. The idea that wealth just “exists” to be distributed is ridiculous. Sorry to resort to this, but it is “commie speak” for sure.
2
Of course the efforts of line workers "contribute" nothing to the success of those at the top...
1
Of course they do; and their pay reflects the value of their contribution. Basic economics.
Family-value republicans support MAGA and give tax cuts to the rich; hypocrites preaching "trickle-down economics" to the WMT worker likely to qualify for food stamps. Wake up America.
2
"For the First Time"?? Where have you been?
Spectrum ceo Tom Rutledge gets $98.5 MILLION , yet is not on your list. this is an outrage. Spectrum Charter the greediest, most predatory company in the world, pays ceo OBSCENE salary, raises prices, lowers services.
3
so, what else is new? nothing will change. these CEO'S destroy companies and then leave with their billions. plenty of heartbreaking stories here, including my own.
4
About 80 years ago the U.S. government introduced a national minimum wage. Isn't it about time we have a maximum wage? It could be quite high. 100, 500 or even a thousand times whatever the national minimum wage is. I think if most Americans saw a video of a thousand people standing next to one person they could get on board with this. Especially when others opposed to the idea say it's unacceptable, the rich need more. And by the way, the people who oppose this idea are the same people who want to lower the minimum wage. NMB. No More Billionaires.
5
So basically congress is burdening companies with another reporting requirement that is utterly meaningless.
Got it.
You must be feeling better now.
4
Unfortunately, these miscreants are a den of thieves.
3
Don’t envy...emulate!
1
Welcome, citizens, to the United Plutocrats of America! First in wealth, first in influence, first in their own hearts. (Apologies to G.W.)
3
The CEO keeps his/her job n gets paid if he/she performs for the company.
2
Get paid even better if ousted due to golden patachute clauses. Good performance has nothing to do with their compensation - plenty of CEO’s who left richer.
1
On your Highest Paid CEOs chart you should add a filter for gender. That would be enlightening as well. It's unfortunately still a man's world.
3
Seems to me that the word "earned" is inappropriate when discussing these obscene salaries.
14
Why do people care what boards of directors of private companies, dully elected by the shareholders of those companies decide to pay their CEOs?
Anyone complaining about it is free to start their own companies and pay themselves the median salary.
6
First of all, the compensation committees of those "duly elected" boards are often stuffed with the CEO's peers and cronies, hardly disinterested advocates for the shareholding rank-and-file...
3
At the company I work for, pay raises are passed down through the management layers, the c-suite providing the pay raise for a division head with a sum of money for pay raises for all below him or her. He/she then gives raises to the direct reports passing the smaller sum to the next level. Just like with a water source, the first to the trough get paid well, and there is precious little left for the masses of workers at the bottom. This has predictable results, there is no need for layoffs at the bottom as retention and motivation is poor particularly for recently hired workers. In a knowledge based company the lack of compensation is eventually fatal; the stock price is starting to seriously struggle. Startups rejoice, as for a modest pay premium highly trained workers are available for hire. Fortunately for America, the rest of the world is aping the American structure, equally enervating workers everywhere and leveling the playing field; America is better at startups so we still have a slight edge.
1
A company I worked for in the height of the recession eliminated jobs (other employees had to absorb the extra work) and froze salaries, yet the executive still got paid their bonuses in those years - why?, because they cut enough costs so they could meet the financial hurdle to pay out their bonuses. So they were sitting pretty while their workers were unemployed or overworked and underpaid. The system is stacked against the worker.
30
I've heard interviews w/ people who claim that these CEO's are hard to come by and therefore you have to pay them top dollar to attract them. It's a sign of the times that this isn't met w/ laughter and that many think this is plausible. Come on! Sure they're talented and bright, like millions of others. They just happen to have gained entry into the club that's run by their brethren, who make sure they take care of their own.
21
Back to the good old "traditional" ways of the Gilded Age?
Or better yet, the days of indentured servitude or serfdom...?
15
Science and technology have given us the sum of human knowledge at our fingertips.
It's up to all of us to ensure that these blessings are harnessed for human wellbeing and not turned into curses by the institutions of plutocracy.
It is an objectively amazing time to be alive, and that can translate into our individual and subjective experience if human society can learn to say "enough" to the corrupt institutions of plutocracy.
Humanity only developed civilization because there was a natural limit on the amount of food we can eat. We also established limits on the "ownership" of spouses to one.
Now it's up to human society to establish natural limits on the legal property rights it will recognize or allow, so we can move on to the next level of human and civilizational development rather than endlessly competing in winner-take-all arms races for superfluous legal property rights.
If we inherit amazing technology that allows us to cooperate with and educate one another from across the planet, but still understand the world in the same way as our predecessors who did not have this technology, then we have failed as humans.
reddit.com/r/Autodivestment
4
The CEO of my employer is on the list. 5 million of his salary would greatly benefit local school districts. Divide that 5 million annually amongst the poorest public school districts. Pretty sure Richmond, Oakland, Vallejo, Hayward, Antioch, etc. would appreciate the money.
Even with that deduction, he would still be in the top 100.
16
What is interesting to me is that the world’s largest & most successful/innovative companies are not on the list.
Apple, Google, Amazon, and Facebook CEOs didn’t make the top 200. Nor Tesla.
Yet together those companies make up, what, a quarter of the NYSE capitalization?
So where’s the logic in these compensation packages?
5
Those particular CEOs make the most by stock appreciation.
4
I don’t see what’s the problem here, the CEO compensation is set by the board who represents the shareholders. If the CEO is not adding commensurate value the he/she gets the boot.
I find these multi million dollar packages motivating but it appears that most of the commentators here are just jealous because they may be stuck at dead end jobs and have no skill or drive that can help them become one of these highly paid CEOs
10
A nice bit of satire; thanks, keep writing.
3
Yeah “jealousy”... everything is that simple right?
2
The problem is that the Times and its columnists do not understand capitalism and economics.
3
A cruel joke here is the continued use of the word "earn" to characterize what an executive is paid. What executive actually "earns" thousands of times what one of his workers earns? Equally offensive is the word "compensation," with the implication that someone gets millions of dollars to "compensate" for the hardship of sitting in a luxurious office suite.
25
My goodness. Defenders of these CEOs should ask themselves why anyone needs to take home 30 million a year instead of 20, and what do the 99% think of the notion of taking home enough money to make one's children, grandchildren, and great-grand-children wealth forever, and then asking the Board for more?
When will the shareholders stand up at an annual meeting and demand an answer to, "how much is enough?"
27
Disposable income is needed for a healthy economy. It's also needed for healthy, educated families. The GOP has shown it doesn't care about the latter, in fact, they love the latter because uneducated people are their propaganda targets - but they need to remember that low and middle income families buy what they're selling! Give them more money!
13
It is high time for a new top tax bracket, wherein everything over $1,000,000 of income is taxed at 50% or more.
And a potent estate tax that prevents this absurd wealth from being perpetuated into future generations.
31
The only way to fix this inequality is a wealth tax. This may require something like a 1789-Paris style event.
25
How can a non-vested stock have any value in figuring a current remuneration. Of course, companies often refigure the vesting figure when it does not reflect a positive value
“…some compensation experts harbor a hopeful view that over time, sustained scrutiny of the income gap might lead to a more equitable distribution of wealth.”
I’m sorry, I’m still laughing. We’ve known about this gap for decades and it keeps getting worse, not better. It really makes one wonder how long people can be expected to remain peaceful in their reactions to this indefensible vileness.
21
In baseball there is a metric called wins above replacement (WAR). It allows you to compare performance of a player to the baseline player at his position. This allows an apples to apples comparison of value added. Economists should be able to do this for executives and put the results out for all to see. A little shaming might go a long way towards shifting the balance back to even European or Asian levels of compensation.
13
These guys clearly needed and deserved a tax cut.
12
Darn right. They shouldn’t have to pay your taxes too simply because you’ve underachieved.
In 1982, the SEC under the Reagan Administration allowed corporations to buy back their own stock as long as they publicly announced it (Rule 20b-18). Before this change, corporations were forbidden by SEC rules to buy back their own shares because they had inside information, the buyback would increase share price and it would constitute stock manipulation. That and massive income tax avoidance by big business is why CEO's are "earning" so much money.
10
Just once I would love to see one of these obscenely compensated CEOs say - "You know, I already have more money than I can spend. I don't need a pay raise this year. Let's look and see what kind of benefits we can extend to the average worker instead. "
Of course I am dreaming. How many more millions and billions do these guys need? When is it enough? Apparently it is never enough, but they seem to think it's just find to keep squeezing the average worker. Most people don't want to live like a king - they just want enough money in order to live with some dignity, put their kids through school, and have some confidence they will have some put aside so they can actually retire some day. For many, this is becoming an illusion instead of a reality.
32
@Dairy: If someone's inner soul is dead, and one is completely empty of humanity and compassion and decency, then money becomes is the only way these pathetic people can keep score. They are empty shells; take away their externals: money & perks & private planes and whatever, and they are zeros in life.
6
Be as impactful or productive as someone in the c-suite.
5
69 yr old white F retired attorney:
Until we read and understand Lysistrata starting in the third grade, women may become the majority in our colleges and professional schools, but they will inevitably hit the "glass ceilings" that I did. I saw the crashes coming and exited to really good alternative workplaces and roles. I chose not to become a public person in my early 30's. Much more effective building coalitions to advance important innovations in medicine and public health. Quietly.
Ladies, until you/we choose to take top posts in our worldwide economy, testosterone will dominate governance (Board members) and private wealth accumulation (CEOs and hedge fund managers). I cannot be Angela Merkel, now leader of the free world, but maybe you can? Or Mary Barra, GM CEO? I will support you and vote the company shares I own behind your missions and values.
7
"The top layer of management"--- The economy problem is that: this is not the real, actual, top layer of management. These CEOs are not educated enough, thus, intelligent enough: to be the top layer. So, these companies are paying way too much for what they are getting. High quality people will not, do not want to work for companies who overpay as well as underpay.
The World Economy and the USA Economy are in the same unhealthy place, right now. I know this will improve because of plans that I am aware of. But, the CEOs of today, will not be the CEOs in the Future. And, many of these non-entertainment businesses will be out of business. Most of the population who are the underpaid workers, will approve of this change because the quality of their human rights will significantly improve. Their political votes will go in the right direction, too. I look forward to lobbying being, only meaning "standing-out in the lobby during a show's intermission".
3
I can guarantee you every single one of these highly paid CEOs can justify why they make so much. I can also guarantee you none of them are actually worth it.
30
Aside from the disgusting amount of money, think of how much POLITICAL power this kind of cash is giving to CEOs. It's no wonder people like them have so much power over our politics, given the amount of money they have at their disposal to give to our politicians. Just for this reason, we need to implement tax laws that trigger massive 90%+ taxes on incomes above a certain level (say 10 or 20 million). It's dangerous to our democracy and it's already done so much damage.
30
The continuing economic inequalities are leading to an economy akin to America's late 19th Century's so-called Gilded Age. The vast majority of American workers are supporting a small cadre of ultra wealthy elites. Workers' surplus value is being captured in greater and greater numbers as American unions have been in sharp decline. Macro economic forces literally create a caste-esque system, and this in turn creates a series of problems. The further a worker is alienated from both the decisions of their workplace and the fruits of their labor, the more they begin to experience the world as foreign and hostile. A world where one controls almost none of their waking productive hours is a world rife with fear and loathing. Add a bit of racist kerosene to the mix, and let's get the Tea Party started! Enter stage right, Trump & Co. The combination of a deeply entrenched plutocracy, which Trump supports over his white nationalist base, and the rise of the far-right coincide. Despite Trump's Austerity & Tax Heist Bill passed last December, perhaps the biggest transfer of wealth from the working class to the wealthiest since the 1920s, his hillbilly (rural and urban, it's a state of mind, not a location, and I am from the woods of Oregon) base remains affixed to the erroneous idea that he's an "outsider." Why? Well alienation and racism created by neoliberal capitalism. Circles?
18
No wonder people don't want to work. They know they are exploited and working more for the bottom line than their own financial well being, which is becoming more elusive is this "greed is good" culture.
28
Obscene. Sinfully obscene.
29
Here's the Davos crowd, ready to tell Andrew Ross Sorkin all of their ideas on how to better the economy and the world. Here's an idea: give yourself a massive paycut. Investing in your own salary likely delivers a substantially smaller ROI than spending on capital assets, innovation or the upskilling of your people.
16
The interesting thing is that you could replace a company's CEO with a monkey and it'll still function in the same way. Well, unless the CEO was a crook with political connections. Replace a blue collar with a monkey and you^'ll have more problems.
27
I started a business with some friends a few months ago. Not only are executive team salaries $0, but we also sank our life savings into the enterprise. Meanwhile, our employees are receiving excellent salaries. Maybe the New York Times can run a piece about how unfair it is that the employees get regular paychecks while the executives risk everything for no guarantees whatsoever?
6
@Trog: If you're looking for sympathy b/c you & your friends DECIDED to start a business & DECIDED to "sink your life savings" into it, you're looking in the wrong place.
You took a gamble & you don't know yet whether it will pay off. Taking the gamble was YOUR choice.
In the meantime, apparently you won't ever get your money back unless your EMPLOYEES do what you are paying them to do.
And presumably you & your friends are the ones who determined how many people to hire & what salaries to offer, so again, whose problem is this? It appears this situation is entirely of your own making!
Can you do without your employees? Then get rid of them. If you can't, then I'd say they're earning their money.
If, by some chance, someone held a gun to your head and *forced* you & your friends to start this business, let me know & I will revise my opinion.
40
L, nicely put!
2
All gambles are by choice so why shouldn’t they win big on a large bet?
1
There's a conundrum in all this. Huge corporations awarding huge compensation packages to executives. If those companies instead gave regular employees double the pay for example, what happens to the millions of people working in small businesses where many owners can barely afford to pay the current salaries much less double? The big companies end up swallowing the little guys which would be really bad. How about creating a new framework to control prices so more people can afford to live on what they get now? Why are those enormous profits necessary at all? Is it inconceivable to create a system under which profits are legally capped and wages must be livable at a standard determined statistically?
2
to our friends in British Columbia:
what you describe is called "socialism" unlikely to be embraced by any U.S. tribes: "from each according to his ability and to each according to his need . . ."
2
When the outrage about the elites robbing the working class reaches a boiling point then a price will be paid.
And it won’t be pretty.
26
Every time we buy something we pay for these inflated salaries. The most galling to me is the extent to which our health care expenditures go toward CEO and other upper management salaries in the pharmaceutical, medical devices, and insurance industries, to name a few.
32
Why do ridiculously rich people strive to make even more money? At some point you simply have more money than you will ever need or be able to spend, so why the greed? And yes, this is complete greed...there's absolutely no other way to put it when the rich are swimming in cash while watching the rest of us struggle to get by. How much more are we consumers paying for their products so that these rich white men can get these outlandish salaries?
108
Some people look at their income and net worth as an indicator of their significance as a person. I am rich, therefore I am somebody important.
16
@W.A. Spitzer: You are quite right, and that means there's a huge number of immature people whose values are completely askew.
IMO, the "I am rich therefore I am somebody important" crowd needs psychotherapy more than they need a bigger payday, esp. at the C-suite level.
3
Wranger agreed, I mean Larry Ellison having a compensation of $47m to add to his worth of $57b is an example. Is it really necessary?
20
Back in the late 1980's a civil engineering grad would have a starting salary with our company of $35,000. The CEO made $350,000. We were publicly traded and the shareholders received a decent dividend. And the company flourished for over 100 years.
These insane compensation packages for today's CEO's are nothing but greedy board members feeding greedy executives. The worker is just an afterthought. If they could get away with it we'd all be indentured servants or worse.
48
just remember the French Revolution.
5
I wonder how things would go if, say, Ford decided to build a new truck, and put oversized bolts randomly throughout their “concoction” and made up for the expense by under sizing the rest? This amounts to the same thing. Why expect superior performance from a “part” that is stressed to the breaking point?
14
Imagine how much still goes to middle management, the biggest revenue suck in any organization.
2
Even if every member of Congress was 100% for a particular bill, that would truly correct this situation, they are too busy running for re-election to accomplish anything.
Boards of Directors need to be held accountable. Only public pressure that leads to financial downturns will ever make these companies reconsider executive pay levels.
CEOs and other Executives who have jobs that can greatly impact the financial health of a company (good or bad) should be paid very well. That said, "very well" could be a number more like 5 times average pay.
9
My way of comparing CEO and worker pay is as follows: the average CEO makes more by 3pm on January 2 than the average worker makes the entire year.
25
Uh-huh. No wonder Trump and the CEOs are killing off Unions- they get in the way of compensation.
18
I can tell you for sure that the listed pay ratio of 211 for Intel is VERY misleading. As mentioned in the article, companies often outsource labor to contractors, and those salaries are MUCH lower than the median. I worked at Intel when they began a very aggressive program to lay off as many non-engineering jobs as possible and get the work done by contracting it to an outsourcing company. What we saw internally was that many people had their 'Blue' ID badges replaced by 'Green' ID badges. They had the same job and responsibility, but were no longer Intel employees, and were paid a lower salary, often with no benefits. It was revolting.
13
true...
but where is the actual revolting?
how bad do things have to get before a good segment of wage slaves gets the notion they are being played and decide to act?
by most reports, even those being taken advantage of in the worst ways hold no rancor against their wealthy oppressors, because somehow they belive that with things as they are, lighting could well strike and they would wind up rich.
this situation is like something out of Eugene O'Neil.
and, think about it - it goes back to religion teaching us to believe in magical thinking.
there is not going to be a Rapture and you will not suddenly go from the trailer park to Park Avenue. but try convincing Trump's "poorly educated" of that reality. no dice: that would call for critical thinking skills which have largely been destroyed by rotten, underfunded public education and its opportunistic parasite, religion.
3
what do they do with all that wealth? it would be fascinating and mildly education to study what drives these men towards so much wealth, exactly what shortcomings they are trying to compensate... because they are surely not enjoying entire weekends away from work and with family so they most willing to stay away from family to focus on wealth, and then what? maybe it's too late for them to change and do something else, to calm down...
10
I believe it is a game and the money is like a batting average.
11
They are not worth what they are paid. Obscene compensation. There should be a 90% bracket for anyone earning more than $2.5 million with a non deduct ability for the payer for the payor above that level.
20
Also shocking is the linked list of the top paid 200 CEO's of 2017, which only names about 15 women. And of those women, several lead companies related to the traditionally female domain, namely children, cooking, and weight loss.
4
What would happen if CEO's were never paid more than, say, $3 million/year. Would all CEO's quit?
If the top pay were $500,000 would there be any CEO's at all?
I have known many CEO's and not one of them was so smart or clever as to deserve the outrageous amounts of money they were taking home. (Nor were they as smart or clever as they imagined themselves to be.)
Note that I did not say "earn" - because CEO's are not "earning" anything. *Nothing* any CEO does could possibly be worth the insane payouts - $100 million/year, $70 million/year, etc. - that are outlined in this article.
48
Just a few decades ago, I believe the CEO:Employee pay ratio was roughly 30:1. I believe that's a reasonable level. Now, we're seeing in the hundreds:1. That's unreasonable.
It's clear that the current model of the board and shareholders maintaining reasonable CEO:Employee pay ratio is failing. And obviously, most CEOs have shown very little moral conscience to raise employee pay more to keep the ratio reasonable.
So, one way to maintain a reasonable CEO:Employee pay ratio may be to have a corporate regulation or law to cap the ratio at a certain level. It's one of the least desirable methods, I understand, but other theoretical and moral methods are failing.
We want regular employees to make more money, so they feel they can spend more time with their family rather than fretting or working multiple jobs.
13
Guess what? Since some huge percentage of the economy runs off of consumer spending, let's stop spending so much and put the squeeze on corp profits, kinda like a "strike"?, until such time that they decide to pay the workers (aka consumers) more, say exec salaries no more than 50:1?
10
"In 2017, the median pay for the 200 highest-paid chief executives was $17.5 million, and they received an average raise of 14 percent"
14 percent? You know what the average raise for the regular workers at my company was this year? ZERO! Yep, the CEO decreed that we'd get NO RAISE at all this year, despite the fact that 2017 was very profitable for the company.
The CEO got HIS raise, though - for "containing expenses" - and those "expenses" are mainly the workers' salaries. And this is a publicly traded company.
You can imagine what a ZERO raise across the board has done to employee morale & motivation. Many people have left the company already, and more are looking to leave.
And 2018's profits will be terrible, b/c of the employee "churn" the CEO has caused.
I sincerely hope the CEO will get what he deserves, which is to be FIRED - and sooner rather than later.
36
I don’t care what anyone says, but what these C.E.Os are doing is a sin!
How much would it really hurt them to take a pay-cut to increase the pay of their employees?
It won’t hurt them at all!
Switch from an 18 bedroom mansion to a 7 bedroom mansion. Instead of a Bugatti drive a Ferrari, and instead of having 6 homes across the country just have 3.
But to these greedy, money-hungry C.E.Os that’s like telling them to go homeless. This angers me so much. If you’re blessed, share your blessings with your employees; it’s more satisfying than money would ever be.
32
@Raul: You are 100% correct, but you forgot something: these CEO's have stunted souls and not much of an idea of what "ethics" means. They can't see that they *are* blessed beyond most people - they just want to pile up money infinitely. It doesn't occur to most of them to "share" - they are selfish by nature. They harbor no kind thoughts for anyone but themselves and their own families.
I know someone who set up a "family foundation" and funded it with a few million of their spare $$. This foundation is just a way to transfer money to future generations, since in the 10 years this foundation has existed, it has given out almost no grants - and the grants they did approve went to "charities" set up by OTHER members of the same family - surprise! IMO, this amounts to monetary incest.
4
Mostly men, vast majority white. Don’t forget that aspect too. Pay more, promote diverse talent.
8
We noted the relative lack of racial and gender diversity in the story: "And while chief executives are among the highest-paid people in the country — the 200 chief executives on the Equilar list, almost all of them white men, were awarded some $4.4 billion last year — they are not alone in enjoying lavish pay. "
2
So we’re all supposed to be making the same? Read any good Karl Marx lately?
2
Seriously? So the incredible inequity is ‘just fine?’ Wow!
9
No, Chris, we shouldn't all make the same. But the ratios used to be much less in happy days when the economy was doing just fine.
@Lenore
It’s not inequity, it’s capitalism. Equity is not the goal, nor the expected outcome. Unless you’re a socialist or, if you’re so inclined, communist.
Among the many inequities pointed out here, there’s one glaring omission. Hint: he occupies the White House; he refuses to disclose his tax return; and even more egregious, before the election (when people should’ve been paying attention), he said that paying NO taxes made him smart. Ergo - those who voted for him were, in contrast..... fill in the blank.
16
This is anti-democratic. We are losing our middle class very quickly in this country. We still have the vestiges of middle class life (education, sports, art, consumption, recreation). But not for long--not with the general monetary precarity that the average US employee now faces.
11
The extreme and increasing wealth inequality is one of a number of outcomes attributable to large campaign contributions, gleefully accepted by both major political parties in the U.S.
11
My father courageously immigrated to a foreign land with his family to learn business so that I could assimilate into the culture and move upwards in society. Now, I struggle with pay and gender inequality plus breaking the bamboo and glass ceilings. It makes me fearful that my daughter will have to work even harder just to keep the same social class as me all because I don't have a multi-million dollar bonus to "donate" to an ivy league endowment.
2
It’s time to put a cap on how much personal wealth can be held in this country. We have a minimum wage, we should have a maximum wage. Set it somewhere around $500 million per family. Any excess can go to charity or to the public good in the form of taxation.
It is time we think of the common good of all our citizens first.
12
Yes, this is a good idea. All my life I've heard the howls that if the minimum wage is raised that business will just collapse! Collapse we say! But until your comment right here I've never once heard that paying obscenely high salaries - with dubious justification - at the top end would collapse the economy. Pay should be related to the value generated. I find it hard to believe that today's CEOs are so, so much more gifted that CEOs in earlier days, whose earnings were more aligned with the rest of the workforce.
6
More coverage like this, please.
35
“After publication of this article, Walmart said it was increasing wages for low-paid workers.”
I can hear the thinking at Walmart.......”What can we get away with?”
7
I give Walmart some slack. They have made some real progress over time.
They also employee millions of Americans - some of whom might have a difficulty locating jobs elsewhere.
Lastly, Walmart, through their downward pressure on prices, has helped millions more Americans to purchase the items they need and want.
1
And steal millions from their local communities in foodstamps and other gov’t supplied amenties for the poor.
1
But remember, we workers can play the lottery and then, we too, can be millionaires! Someone always wins!
2
I work for a public, multinational entity whose name every reader knows. I'm pleased that our CEO is not on the Highest-Paid list.
Phps. because our international HQ is outside U.S. and our corporate culture is not typically American, our CEO and Sr. Executives recognize the importance of acting as leaders and exemplars. In a recent year of financial losses, they forfeited their raises and bonuses -- while still giving them to the rest of us. Honorable act aside, that was smart. They'd need our efforts to dig out, and a motivated, appreciative personnel roster outperforms an unmotivated, resentful one.
Companies would be wise to self-impose compensation guidelines.
CEO pay should max out at a certain multiple of the median salary. And CEO and Sr. Executives should not be eligible for bonuses or raises in any year:
- with either losses or zero profits
- with staff layoffs
- in which the company is found guilty of crimes such as price fixing, environmental illegalities, etc.
Reading this piece and the accompanying comments, I feel lucky. Sure, employees in my company can find things to gripe about (e.g. the refusal to increase headcount), but we don't feel dismissed by those at the top.
I can't imagine that greedy CEOs don't contribute to a high turnover rate (if their underlings can find greener pastures to bolt to), or to a miserable work force -- and you need not be a genius to know that that's not good for the bottom line.
27
The NYT style guide should discourage the use of "earn" when describing eight figure executive pay.
84
Do you make more than $31,000? Because if you do, you are in the top 1% on a global scale and someone somewhere finds that obscene.
2
And of course, $31,000 will take you exactly as far in rural Botswana as it will in Park Slope, so that is undoubtedly a very apt comparison
More liberal complaining from the bottom 99.99% to cover up the fact they're just plain lazy.
4
Lord,
Please let this be sarcasm. And pardon me for being so scarred by the last year that I can't actually tell.
Amen
The Left-Centrist Prayer for Sanity and Mercy
13
Who can you name of all these too-rich power-grubbers who could last a day on a Mexican construction team?
19
Those with top degrees from top schools who lead tip firms have earned the right not to toil in menial jobs. There’s no comparison.
2
"Why is what others have important?"
Because, throughout history, nations have fallen when money and power become overly concentrated in the hands of a few.
Leaving aside the issue of morality, wealth inequality is simply bad social and economic policy.
26
Compensation for CEO's over the last two decades has evolved/devolved into the professional sports model.
Under this theory there is a very limited supply of superstars that can handle the CEO job, so they need to be compensated accordingly. The people at mid-level and below are just those needed to round out the bench and are paid as just another cog in the machine, easily replaced
4
While they put all the rest of us up to competitive bidding.
3
Based on current trends if you work for 275 years you will just fall further behind.
7
How can you even enjoy $21 million? It is just a number at a certain point. There isn't enough time in a lifetime to spend the kind of money these people make. It infuriates me to think of all the people who could use a small fraction of this to make their lives and their communities better.
Why do we Americans continue to put up with these disgusting paychecks? These CEOs don't deserve them. They don't work nearly as hard as their employees, and they are not fabulously talented in a way their underlings aren't. What a fantasy all around.
10
Many of them fund large patronage networks of political operatives. They call it "giving back".
11
Wealth is capitalism’s scorecard. It’s why Jeff Bezos, at $130 billion is twice as important and two times better than David Koch, at about $60 billion. And Koch is twice as important and two times better than Alice Walton at $30 billion.
3
@From Where: Wealth is stupid capitalists' scorecard - an illusion. The rest of us know what matters!
And in the end, not one of those zillionaires is *actually* important, except in their own minds. They'll die some day, just like we all do, and will soon enough be forgotten.
Huge amounts of money bring out the stupidity in a lot of people, and Bezos, with his declared intention of spending his billions on commercial space travel, is just exactly that stupid! His shallow choices now indicate that he'll look like the fool he is in the long run.
There must be limits on wealth, period. Someone used the word "grotesque" to describe our inequality. It's not only income inequality ... the inequality in wealth is even greater than income inequality. Everyone should be asking and trying to answer: How Much Is Enough?
11
Should the Yankees be limited in WS rings until at least two other teams catch up? Should the worlds largest auto manufacturer slow production until the worlds smallest has sold an equal number of vehicles?
Well, all that money spent doesn't guarantee the Yankees nor Red Socks world series trophies. And all themoney paid to CEO isn't going to guarantee higher dividends to stock holders.
Thanks for advice. I will get right on it.
1
I think some enterprising Artificial Intelligence researcher needs to focus on making Robot CEO. AI reaches for the executive class!
Consider:
The new artificial boss would probably work for a whole lot less compensation, whatever that would be, which is win for the shareholders.
Also, the AI boss would have as much humanity as the CEO it is replacing, and perhaps, more humanity could be programmed as a feature. This is a win for the employees. Maybe even the world!
So, it would be a win|win situation for everyone involved, except the flesh and blood CEOs. Well, you can't please everybody.
11
Best idea I've heard in a decade. Because the CEO is essentially a decision-making role, and AI automates decision-making, the upside is massive. Middle management or other interpretive layers can guide tactical actions at lower levels of the business.
2
The year Tim Cook took control of Apple he made more than all of Apple's store employees made COMBINED. It was something like $375,000,000.
Now, I'm sure Tim is a smart guy that brings a lot to Apple, but... well, let's just say it brings to mind the Pharaohs.
26
Don't forget how Apple supported its stock price by stashing its cash horde overseas and justifying tax dodges by saying they didn't violate any laws. Further stock price support by a gargantuan stock buyback after the GOP tax cut. These actions supportive of CEO pay and to the detriment of USA infrastructure.
6
You would think they could give their customers a break.
No one is forced to buy an Apple product. Whatever the price, customers pay it only because they see at least that much VALUE in it.
Every American knows this by now, and almost all believe it is immoral, indefensible, and should be stopped. But nothing changes, nothing happens, and the wealthy CEO's and top executives just keep getting wealthier and wealthier while 90% of Americans keep getting poorer. If this isn't a classic example of a Banana Republic, then what is?
16
The only thing that ever kept these people reasonable was high marginal tax rates on mega-incomes.
24
Not here in the Boston area. High tech start ups are neither over rated like their Silicon valley counterparts, nor do they received high valuations. CEOs of start ups receive below market pays. And if you are an entrepreneur be prepared to be cut off the list when it comes time for the Venture Capitalists to get rich from the gains and spoils.
2
The CEO of General Dynamics makes $21 million. Recently, General Dynamics browbeat the Maine Legislature into giving it $3 million a year for fifteen years so its Bath Iron Works subsidiary could stay competitive.
12
Private citizens will soon bear all the burdens of government, and corporations will pay hardly anything for all the public works they use and government work they do.
12
CEOs have big responsibilities and should be paid for that. The more responsibility, the more money. But one of their responsibilities is employee morale and productivity. Money is a key motivator for every worker, bottom to top. Learning that the big boss and other executives are making megabucks and getting bigger raises compared to all other employees dampens morale and low morale leads to lower productivity. So a CEO's pay should always take employee morale and productivity into consideration. If his workforce is not happy, he's not doing his job.
4
Exactly what does one have to do to “earn” 2 billion dollars per year? It can’t be legal, healthy, or moral. There is no evidence that these bloated salaries and incentives actually make an executive competent or hardworking. A good example is medicine. The suits who never touch a patient or even touch someone who cares for patients make obscene money while slashing nursing, medical, therapeutic, and pharmacy services. I would call them prostitutes but that would be unfair to a class of workers who by and large earn what they make.
15
I never vote proxies to approve the executive compensation packages. But it is just like voting in US elections. It's like it never even happened. Now it won't be long before they buy back most of their stock and squeeze out the remaining minority shareholders.
9
Really this is an update on old news about CEO salaries. It is a good article but we need more. How about information on the law firms that let corporations have the same rights as individuals? No more class action suits thanks to the Trump owned Gorsuch and the law firms that pushed this through the courts. How much are these massive lawyer herds being paid to shaft the American worker?
11
Our Supreme Court of extremely sheltered Ivy league eggheads ruled that corporations are people, super-people, really.
11
@Steve: If corporations are people, a lot of them deserve the death penalty.
A version of this article appears somewhere in a reputable publication every few years, to my notice.
I would like one to appear every coupleof months.
Shareholders have gone blind to the fact that their pet stock is but one in a universe of many other shareholders' pet stocks and, as an aggregate, its a zero sum game.
Of course, executives and traders, make fortunes and higher consumer prices make up the difference.
1
Why is what others have important?
2
Because what other people have they took from someone else who doesn’t have any more.
12
When companies gladly accept tax cuts and use these to pad CEO pay and shareholder dividends, the employees get hurt. Their paychecks don't reflect the windfall the CEOs and shareholders enjoy. The well being of working families is important. That is why it is important.
9
They're buying back their stock to avoid the need to pay dividends now. Shareholders are not their prime concern.
1
Keep the CEO salary as 1$ p.a., and then lets see how loyal and visionary they are for the company.
2
All the money in the world isn't still enough for these gluttons.
5
Overcompensated executive is caused by corruption in the Boards of Directors. They are not representing shareholder interests. We think there is a fallacious, wide-spread belief that only superstars can be executives, but that's not true (most people think executives are incompetent boobs & ingrates). The true reason is corruption within the Boards of Directors, and usually beginning with the "Chairman and CEO" (if there was ever a more completely obvious conflict of interest, it is the shared title "Chairman and CEO"). Any time a company has a golden parachute clause, that's a a sure sign of collusion between the executive group and the Board of Directors. Be smart: never invest in those corporations. They are robbing the shareholders.
11
The US interlocked directorship has never been more pervasive than it is right now.
4
Those who provide most value should be rewarded handsomely if you agree. Indeed, CEOs create values for the shareholders. But teachers create values for our futures. Why teachers need to assorting for strikes for a pathetic pay raise while CEOs can get the raise much easier? Are CEOs are more than handreds times more capable than teachers?
Any smart people can explain the reasons for me?
6
The CEOs finance our elections, so pols reward them. Public financing, free tv ads of pols talking to a camera, all income taxed at same rates, sharply graduated. We must fix this so we keep democracy!
6
Oh yes, sure, but CEOs "deserve" their pay. You know, because they "work" all the time. What kind of work? Well, going to meetings and... ah... making... important... decisions. You know, the hard stuff. And sometimes they answer emails on the weekend!
13
Work for 275 years.
But also: get up every day at 5 PM and get home at 11 PM.
It's all about tradeoffs.
2
Ok so maybe CEOs can be paid double the median pay for double the hours...lol. I mean some of the lower paid people have several jobs if you read the whole article. Sorry the math of tens of millions of dollars vs a few tens of thousands of dollars is literally a thousand times more than the median pay.
1
This is exactly what the GOP wants, a very small "owner" class and a hundreds of millions of peasants. It's the new American way and the GOP tax cuts ensure it will last generations.
This will all work out well until the peasants, dying in the streets, realize they can't feed their kids, afford medical care for their families, or save for retirement. Then out come the pitchforks. Think it can't happen here. Wait and see.
31
I don't know if all our "pitchforks" -- or even all the automatic weapons we mainly use against our fellow peons here in America -- will be forthcoming or enough to overthrow this fattening kleptocracy.
3
The CEOs are not the ones making money for the shareholders, the workers are. That's why the pay ratio inequality is so shocking. Without staff, there would be no shareholder value. I can not figure out why the C-suite gets rewarded on the backs of employees. It's the mining-town model all over again.
14
I worked for years in financial service corporations. I always thought it was because the CEOs "took all the risk". But really, when bad things happened, others lost their jobs down the line. CEOs are the last to go, and they go with money in their pockets. They wait a few months, then get hired by another corporation.
35
It is well known in criminology that high income equality correlates with high violent crime rate.
Shareholder value is not the only thing that these CEOs generate.
4
Whereas a full professor at a major research university may have to work only 10 or 20 years to earn an amount equivalent to one years salary of the head football (basketball) coach. Don't even think about the average secretary.
8
Jeff Bezos, Robber Baron owner of Amazon, is not on this list.
Big surprise. Apparently he didn't want his "prime" marks to know how much he makes. I heard a gentleman who specializes in wealth inequality say, on television the other day, that Jeff makes $245 MILLION PER DAY.
It's outrageous. Some of his warehouse workers have to live in cars or with parents/relatives. Stop enriching Jeffrey. Only use Amazon to buy things you can't find at local stores.
DEMAND that our elected officials break Amazon up into tiny pieces so they have to compete in every category they are trying to take over - including the government contract they are trying to get to provide OUR photos and private information to law enforcement. Did you sign up for that?
6
My internet search turned up Bezos' Amazon compensation at $1.7M for 2017. 59 times the Amazon median salary. Not enough to crack this list. Perhaps you're confusing his net worth increase when Amazon stock takes off with the compensation package paid to him by the company. He has made up to $1.5B in one day due to a huge stock increase, but that's not the same as compensation for the CEO job. He apparently is not even the highest paid executive in Amazon, but I guarantee you he is the richest.
6
Amen. Amazon is a prime example of a company whose employees works like slaves for next to nothing. There is nothing to admire about Amazon!
2
This is why I avoid using them if at all possible. They enslave our minds and pocketbooks while treating their staff abominably.
3
'sustained low wages can lead to reduced economic growth and marginalize large swaths of the population. '
And they become Trump's vote bank!
9
Corporations want a marketplace for their employees, ie, compensation is determined by the marketplace for labor...no more and no less.
However, executive compensation is set by an Board Committee using arbitrary rules like what's seems appropriate based on what other corporations are paying their executives...not actually a "marketplace" for executives. Moreover, the Board members are beholden to the executives who select them to serve on the Board.
So its no surprise that executive pay has risen relatively much more than that of the median workers.
3
So tell me again about the democrats inability to connect with middleclass Americans. By suppressing these wages while living like a king, these CEO'S are what's making the American taxpayer feel unappreciated and forgotten by the ruling class. This is the republican base and who they serve. With FOX news and their radio talking heads constantly blaming the democrats for their economic woes, it's nothing short of a miracle that they have convinced the low wage earners that by voting republican, they'll make their lives better and the democrats can't. If anything (other than Trump) can bring down our country, this income inequality is it.
19
You need to keep hammering on this inequity NYT. Our democracy is at stake with such skewed inequality and the ability to use this ill gotten "earnings" to buy politicians.
5
Greed is the root of evil.
Coincidentally, Greed is also the Republican alt-Jesus.
Financial insecurity is probably one of the main drivers of divisiveness in our time, and it continues to get worse as we continue to give more tax cuts to people who already have more money than god.
11
Glad to see a lot of women on this list.
22
What’s a patriarchy? It’s all Greek to me.
3
According to the Economic Policy Institute, a left leaning economic think tank, the ratio of Ceo pay to average worker pay was 20 in 1965 and 22.3 in 1973 (https://www.epi.org/publication/ceo-pay-continues-to-rise/)
The question is: did CEO’s increase their value from these ratios in the low 20’s to 275:1, today? Nowhere can I think of has individual level performance increased almost 14x in about half a century, yet that is the rate at which the CEO pay ratio has increased. Unless corporations produce good explanations for a 14x gain, we can for now hypothesize the game is rigged. And, if the game is rigged, doesn’t it beg the question of what we, the people, are going to do to restore basic decency to CEO pay ratios? I ask this, given CEO and corporations, are doing nothing, except they increase CEO pay ratios.
16
"I work harder than the workers work!"
CEO's are the best at being self entitled and greedy.
4
I’ve heard nepotism/cronyism work wonders, too. Excellent meritocracy.
6
My previous humorous post aside, what would happen if we capped the CEO pay to 20x that of the normal employee, freeing up X additional money to redistribute to employees. Would X divided by the number of employees really amount to much? This topic would be worth an article all by itself, NYT.
3
Why don't we all cap our income at a living wage and redistribute the excess wealth to everyone? Because it doesn't work. It been tried and tried again and eventually fails.
1
Any limits on executive compensation would be returned to shareholders because wages are driven by the job market.
Where are the articles about basketball players with the top 25 making an average of $29 million a year. Or football players - averaging $34 million annually for the top 30 players. How about entertainers? Are CEOs just easy targets? This is capitalism! These CEO are responsible collectively for how many workers who aren't in poverty because they keep their corporation in business? Pew Research - from 2001 to 2011, nearly 700 million people globally moved out of poverty because of capitalism. "The inherent vice of capitalism is the unequal sharing of blessings: the inherent virtue of socialism is the equal sharing of miseries." - Churchill. Enjoy your blessings because without capitalism, a system that can pay a CEO more money than they would ever need, has benefited the majority of us.
4
While I agree that athletes and celebrities are overpaid, at least they are actually putting in the work. It’s not like LeBron James gets to hire five cheaper dudes to shoot hoops for him while he sits on the sidelines counting his money.
32
Well, in that case the athletes are the employees and the more or less free market is determining their pay. There's high demand for people who can hit MLB pitching, and hardly any supply. You'd want to compare their incomes to those of the team owners (lots of billionaires among them) or executives. As an aside, remember that pro athletes only earn that for a few years. But the real point is that CEOs control the pay of their employees, and coordinate with their cronies to keep nearly all the available pay in their own hands. These guys sit on each others' boards in a system that's basically corrupt—their pay is largely divorced from the relative value they bring to their companies. It's easy to see that by how widely their pay varies from company to company, and how far they've departed from highly successful companies of the past. It's as much a kleptocracy as it is a free-market system of capitalism.
6
You really think that only these CEO's can run their companies as successfully as they can? I don't doubt their smarts and their abilities, I doubt that they are worth what they think they are worth. Somebody else would have come up with Amazon, Jeff was just the first and probably most ruthless. In addition, I've watched Undercover Boss and I'm rarely impressed with the majority of the CEO's. Lastly, these guys can fail spectacularly and still get to keep their money. Capitalism exists within a democracy. The people through their democracy can chose to mold the economic system to their needs. The problem is that now capital and factories can flee to other places around the world where economics are more favorable to business.
5
Seems like there is an easy fix. Just tie CEO pay to the median employee pay instead of the stock prices. Limit CEO, or Ll executive compensation to a reasonable multiple of median pay, say 20x or 25x. CEO’s getting a 14% annual raise would be cheered by the rest of the company’s employees. Since we can’t eliminate CEO greed, instead, leverage it.
19
Or better still, actually link it to the company’s economic performance. Corporations that lose money should reduce the executive suite’s pay by the same percentage as the loss.
2
I wish the NYT's would focus its investigative reporting to the company that is the Enron of our times - General Electric. Playing out right in front of our eyes is the story of corporate greed, a sycophantic board of directors, and numbers manipulation all designed to for maximum CEO benefit. The company now crumbles under its own weight taking down thousands of hard working employees with it while Immelt and Welch laugh all the way to their yachts off Capri.
18
You mean Saint Jack Welch, the king of Wall St all those years? What a con job he and his ilk have perpetrated on the rest of the country.
6
Jack Welch former GE CEO, is Exhibit A of the broken American business model of the past 40 years. Welch was lauded as the greatest CEO and GE a great company. It took almost 40 years to realize that Welch was a complete empty suit and a greedy one at that. General Electric will cease to exist in five years. All because of Welch's greed and lack of vision. As Warren Buffett always said "You see who is swimming naked, when the tide goes out".
7
Dems should repeal the Repub tax scam and then cut corporate tax rates ONLY for those companies whose top salaries are no more than 50 times the median--or even lowest paid-- employee.
4
How is it productive to compare what a CEO makes to what an employee makes? This is about supply, demand and cost of goods. CEOs , the ones that are responsible for making sure share holders make money are in demand Register workers are not. If you Took 100 million salary and divided it by 1.5 million wal-mart employees they would make less than 100.00 more per year. If you want employees to make more look at minimum wage increases for corporations. This will force wal mart to raise the "always low prices" which you love so much. Maybe microwaves should cost more than $25.00. Just Saying.
6
Well, is it really the CEO's fault that they can't help but get 275 times more work done per day than the average employee? By Jove, just one swing of their golf club equals my entire workday!
And besides, there's a silver lining: The harder it is for Joe Schmoe to make a living, the less children he will have, resulting in a long-term plus for the environment. (Of course, by that line of reasoning, a worldwide famine or a plague would be a net gain as well.) So you see, the CEO's have a very beneficial long-term view after all.
11
And fewer children born means that there will be fewer workers, so the ratio of worker to pensioners will be lower leading to quicker depletion of Social Security's funds, so that pesky entitlement will disappear. I bet the CEOs are slavering at the thought of that.
We should differentiate between the Zuckerberg and Bill Gates who built their own company vs this new Class of Robber Barons who are making a killing off Publicly Owned Companies. The board of these companies provide little independent oversight within a Compensation Culture of "I'll scratch your Back than You'll Scratch Mine".
8
So true. Perfect example - General Electric.
4
This obscene inequity is the result of capitalist greed. The acquisition and hoarding of wealth has become the holy grail of American culture. Americans view any sort of sharing of wealth or prosperity as a socialist anathema. Societies survive and thrive when its citizens are treated fairly, neighbourhoods are safe, every person has a piece of the pie. The system that is being perpetuated is a fierce competition for hoards of money for only a very, very, very few people. This can only end in disaster.
12
I think any company that outsources employees should include those salaries in it's calculations. All those outsourced workers (either here in the USA or abroad) are working for less money, less benefits and have less job security. Any money the corporate saves goes right into management's pockets.
7
Not quite true, since you're only looking at the earnings side. To get even, you'd have to work for 275 years without spending anything after the first year. No food. No housing. No clothing or medical expenses. Kind of like being dead but having to show up for work for almost 3 centuries anyway.
9
I have often complained that corporations deduct their expenses from their earnings before they pay taxes. Why can't I do the same? Of course, that would mean that many Americans (like many corporations), would pay no taxes and get refunds - since many American live beyond their means!
5
Corporate CEOs and executive officers are almost never innovators or entrepreneurs; in almost ever case they are simply employees . To be sure most of them are highly talented, but If capitalism were functioning their compensation would be determined by the laws of supply and demand. In most cases they would not receive one/tenth of their present incomes. Of yes I know, the stock holders, owners of the companies, vote, but it is obviously a total sham. When was the last time you ever heard of stockholders denying the corporate CEOs pay or rejecting someone hand picked to be a member of the board of directors? No. What we have is feudal system where the CEOs and his buddies seize control and run the corporation like a mini kingdom all the while filling their pockets.
22
CEOs make almost all these ridiculous sums of money on the growth of the stock, usually defined in terms of growth in Earnings per Share. Part of what drives EPS growth is stock buy-backs, which reduces the number of shares outstanding. But the money for those buy-backs is money that could be given as dividends to investors or used to pay higher wages or even to hire more workers to help reduce stress levels or to invest for future growth. So essentially the CEO is using Employee/Investor/Investment money to enrich him/herself. This is one of the techniques that falls under the category of what is referred to as financial strip mining.
One small step then would be to calculate what the growth in EPS would have been without the buy-backs. If the CEO had grown EPS 1) without the buyback money and 2) at a substantially greater rate than industry peers, it would't bother me at all if performance like that was then handsomely rewarded.
7
Always kind of curious how these elite CEO types got to where they are - there is no CEO major in college and the skills required to turn your average college degree into a tens-of-millions-of-dollars a year job are not entirely clear to me. Many of them seem very young, relatively. If somehow there were "equal access" to these career paths, maybe the discrepancy would seem more palatable, but just the one off line that they are mostly white men tells me this is not true.
10
One can hire 1000 employees to fully staff 3 to 4 Walmart stores yearly for the yearly price of one CEO. Incredible! Fire him now! Unfortunately for CEOs it's highly profitable to get fired - golden parachutes and all. What's the ratio compared to a fired employee? Undefined because employees get ZERO?
Add in the massive "perks" CEOs get - chauffeured commuting, steak lunches and dinners, unlimited travel, country club and golf memberships, etc. and plenty of time to vote and enough cash to buy politicians to serve them.
A more useful ratio is - CEO compensation to minimum wage - after all, most Americans earnings are trending towards minimum wage.
Reality is it would take 275 years to work for what the CEO earns NOW. But as you work those 275 years the CEOs pay would continue to grow, requiring the same person to work more years. Indeed, extrapolating out you'll never earn as much as a CEO in one year even as you approach working an infinity number of years - CEOs will earn infinitely more.
What will Walmart's CEO earns per year in a 1000 years? The poor employee works and earns for a millennia to make what the CEO made 1000 years ago. They'd have to work another million years or more.
Replace the Walmart CEO with 500 employees and a livable wage and 500 tax payers to boot. What better bang for your buck than that?
Convince me that one could not hire an entire executive suite to do as good a job for a tenth of what is now paid and wasted on the entitled at the top now.
12
This. Is. Not. New.
1
“The invaders brought into Britain a principle common to all Germanic tribes, namely, the use of the money power to regulate all the legal relations of men. If there was any equality it was equality within each social grade. If there was liberty it was mainly liberty for the rich. If there were rights they were primarily the rights of property. There was no crime committed which could not be compounded by a money payment.”
― Winston S. Churchill, The Birth of Britain
5
I've always had a hard time wrapping my mind around the idea that anyone provides THAT much value to a business. Good decisions and leadership certainly deserve some extra compensation, but this is ludicrous.
I wonder how workers, or society generally, can expect any kind of moral decision from people so far removed from the economic positions of their fellow citizens. It's it possible that such stratospheric compensation leads to corrosive effects in society? Remember, these are the people who also get to set public policy through lavish spending on politicians. It's this the best we can do?
17
Limiting CEO Compensation a history of Congressional Failure
Lets start with the fact that these outrages salaries are largely tax deductibles for the corporation what pay it. The fuel that fires it.
Here is the history on that.
1992 Bill Clinton “in Putting People First” calls for cap on tax deductibility of CEO salaries
1993 The Democratic controlled House passes Bill Clinton’s bill that now, contains a huge loophole “Performance” pay, including stock options and certain bonuses, would be exempted from the deductibility cap.
1993 - Companies began limiting salaries to around $1 million with the remainder labeled “performance” pay
2008 - Congress in the Troubled Asset Relief Program eliminates the bonus loophole for financial bailout recipients — but only until they repaid their public funds.
2016 Stanford Business School survey show that 70 percent of Americans, including 54 percent of Republicans, believe CEO pay is a problem.
2017 On Nov 3rd The Joint Committee on Taxation estimates that eliminating the tax deduction would raise $ 9.3 Billion over the next 10 years
2018, May 22 Congress passes law to limit Frank Dodd with 100 % Republicans, 82.3% Democrats voting for it
How can these failures, on the Democratic side, be explained ?
Campaign Contributions
The top 10 contributors of Charles E Schumer, Leader of the Democrats , all are from Wall Street.
https://www.opensecrets.org/members-of-congress/contributors?cid=N000010...
11
It's obscene. We as a society need to be a lot more imaginative about how we want our world to be. Maybe one day TAKING like, to that level, will be illegal, while so many have so little. I never thought I would see the day where Harvey Weinstein got arrested for TAKING from his victims. Maybe someday the rapacious people will be checked, legally, from amassing money in such excess.
4
Anyone interested in how we arrived at this obscene disparity in compensation should read "Winner Take All Politics" by two political science academics (Jacob Hacker of Yale is one). It's very readable and provides a clear account of how this transformation occurred in American corporate life. This was not inevitable or random, but the result of a number of well-thought-out and deliberate public and private actions to enhance the political and financial power of corporate interests at the expense of middle and working class Americans. It will not be easy to chip away at this well-entrenched inequity but I think the future health of this democracy requires that we do so.
15
Interesting article by David Gelles. However a reality check is needed.
Ken Lay, CEO of Enron, was spending time choosing the color of their corporate jet as the company was going down. Most CEOs make obscene money because of a lapdog board of directors who are also paid an obscene amount for paying the CEO a fortune. Also manipulation of stock prices is more likely the reason the CEO "looks good" rather than his/her leadership.
CEO pay should always be guided by the "Best Alternative Rule (BAR)"
1. Company now pays 100 million/year to CEO
2. Can company find someone for 50 million/year to do the same job ?
3. Answer to #2. is YES
4. Can company pay 25 million/year to do the job of 50M/yr CEO....YES.
And so on until you get to 100-200K/year which is an excellent salary for 99% of Americans. Plus the person at the 100-200K level is still striving to make the company better, introducing innovation and incentives for workers while the 100M/yr CEO is thinking about spending time on his yacht in the Hamptons.
24
It's been said before. Sometimes in jest. Sometimes as metaphor. Sometimes as warning. But perhaps we've reached the point where we should actually follow through on this old ditty... "Eat the rich."
5
Tell us more about the Royal Wedding . . . . We huddled masses are hardly going to be lining the streets to celebrate it adoringly here.
5
The CEO of the company where I work makes 215 times what I make. Sigh. While I'm sure it's a big job and I don't begrudge him his millions (I guess), it's galling to reflect that:
1.) Wages have been relatively stagnant my entire working life
2.) Annual raises at my current employer barely keep up with inflation at 2-3%, and the message is always "oh it's been a tough year" or "there's only so much to go around.” HR tightly manages the process to prohibit managers from giving any of the worker bees on their teams more than this, despite anyone’s performance, skills and tenure.
3.) After each round of layoffs, so we are made to feel lucky to even have a job, and scarcely dare to complain when asked to "pick up the slack" and do the work of 2-3 people
4.) There seem to be more contract workers every month
5.) #me too – women are treated worse than men and paid worse than men
6.) We are expected to be available via text and email 24 hours a day
7.) Workers didn’t see a dime from Trump’s super-duper whiz-bang tax cut plan, from which my company benefitted enormously
All the salary, perks, and glory are now going to the top 1%. I am just praying Social Security will still be around when it’s time for me to retire, because otherwise I will be on the street after working full time and paying taxes for over 50 years.
283
Your list summarizes perfectly everything that has crushed my soul about working in corporate America for the past 3 decades. Bye bye American dream. Hello retirement that will no doubt include working at a Starbucks to make ends meet until I drop dead.
28
You have outlined perfectly my own experience. Minimal raises because of small pools of money on which each team can draw. At least, that's the excuse. Accountants in corporations are not looking for ways in which they can increase staff compensation, merely looking for how to cut spending.
19
The most effective thing you can do is to vote, and convince as many others as you possibly can to vote. Short of violent revolution, I don't see another way of changing how you and other Americans are being drowned by wealth concentration.
14
I actually think these kind of articles are worthless. They provide no context. Also, those people on the bottom only survive if the CEO makes good choices. Also, if you took the ceo’s salary of 20m for wal mart and distributed it amongst the workers, they would see no notable pay increase cause there are too many of them. Its better for them (workers) to pay the top guy and hope he can increase performance of the firm and pay them more. These articles amount to class warfare.
3
Perhaps there are other things to consider. One requirement for a CEO to earn his or her bonus is to minimize expenses. Thus, he or she wants to pay their workers the least possible for the most work. Paying the CEO well is unlikely to lead to higher wages for those who must interact with the customer. Likewise, when you hire someone at a poor wage you get what you pay for--someone who does not the skills to move to a higher paying position, who isn't motivated to do their job, feels unappreciated, and is looking to find something better soon! Studies consistency show that when workers are satisfied they try harder to satisfy the customer.
8
" if you took the ceo’s salary of 20m for wal mart and distributed it amongst the workers, they would see no notable pay increase"......That totally misses the point. What they are engaged in is nothing but theft. Theft is wrong. It needs to stop.
5
I feel sick to my stomach now over the disparity.
21
"We can't afford free tuition and Medicare for all," say the rich CEOs and their GOP-voting enablers as the former wire their 275:1 salaries to the Caymans.
144
"Medicare for all?" Hey, 35% of adult Medicaid clients are smokers -- why don't they stop? Wouldn't that help them focus on other issues?
This is the cause Millennials should be fighting for the most: Redistributing corporate wealth to be more fair to the nation's workforce. That and campaign finance reform. I've given up on the current crop of politicians on both sides of the aisle but one can still dream for the future.
19
There are plenty of qualified people who could do the job of the CEO. In other words, the supply is greater than the demand and prices for them should go down. But the top job ironically does not abide by market logic.
22
So Trump promised to create jobs and improve salaries. Many suspected that his actions mainly benefit rich people. Given your research it would be interesting to know if the average worker is better off since Trump came in or is it only the 1%!
2
CEOs got raises, on average, of 5% in 2015, 9% in 2016 and 14% in 2017. And what raises did their workers get? Close to zero, I'll bet. If workers ask for a 5% pay raise, management starts howling about how it's going to raise their costs so much that it will put the company out of business!
30
My 50 cent hourly raise was the best my large retailer could afford apparently.
2
Bingo. Restaurants in Alexandria VA saying they'll all go out of business because customers would pay another 16 cents in tax on a meal to support affordable housing. Right, everyone is going to drive to the next jurisdiction to save 16 cents. Same story with paying wait staff more. If all have to do so, no one has a competitive advantage.
1
Executive compensation exceeding combined share holder earnings.
1
In Search of Excess - the Overcompensation of American Executives Paperback – 1991 by Graef S. Crystal
The American business practice reveals how CEO salaries have risen drastically while productivity has declined and discusses how inflated CEO salaries damage company morale and the national work ethic.
More true today than it was 27 years ago.
7
This is one thing I like about working for the government; much flatter salary scales. Even the head of the agency earns only about 50% more than I do (and should, IMHO, earn more). You can argue that the lack of large pay increases from promotion reduces incentives to work hard, but people are frequently motivated by factors other than money.
The problem with corporations is that the people who decide salaries are the board, who are frequently fellow CEOs who create a self-reinforcing loop when it comes to executive pay.
28
It might be fair to suggest, absent the anti-business hyperbole, that the skill sets needed to run a successful company are not that common, and the value creation of a good CEO may in fact be an order of magnitude greater than a standard employee.
3
I agree that CEOs have skill sets that are not often found in the rank and file. But having said that, it is an obscenity that their employs cannot live on what they are paid considering that the company can't run without them either, and that the company is doing well enough to give the CEO and shareholders that much money.
McDonald's without all their burger flippers would close their doors. So you tell me, who is really all that important here?
22
I'd agree with you on "a good CEO may in fact be an order of magnitude greater than a standard employee", but "an order of magnitude" is 10:1, not ~2000:1/*. That's more than three orders of magnitude by my calculation.
According to a quick Google search, ratio in 1970 was ~23:1 in 1970 and average is about 250:1 now.
*/Salary comparison of First Data's CEO Frank J. Bisignano to average employee topping list in the Equilar "Top 200 CEO study" cited in article.
13
Some company CEO's who have founded their companies or developed a unique idea may deserve this compensation, but in most large companies the CEO is a political animal who plays golf while his employees are slaving away.
I worked for one of the companies mentioned in this article and I can assure you that the CEO at the time was quite unremarkable, but he was a "scratch" golfer.
18
Is it not obvious that this disparity is not sustainable? Who will remain as customers of these companies if people can't afford rent and food?
22
"In theory, such compensation plans encourage chief executives to focus on creating value for shareholders. And at times, that pay seems to mirror the fortunes of the company."
But this can push executives to employ strategies to prop up the stock price, rewarding shareholders (and themselves), instead of employees by, oh I don't know, say spending hundreds of billions of dollars received from tax cuts on share buybacks and offering almost nothing to employees (almost no raises, some one-time bonuses).
I think there has been a shift in culture over the past 50-70 years. It used to be that employees, all employees, were seen as assets, valuable parts of a company, and were treated as such. Now, anyone below upper management is an interchangeable part or even a liability, a cost that must be minimized. The only thing that matters is the shareholders. I've heard this said many times. A company has a responsibility to its shareholders. Not to their customers, not to their communities, and certainly not to their employees (very occasionally I've heard the first two mentioned - never the third). And executives and shareholders (many of the largest shareholders, of course, have places on the boards of these companies) simply reward each other. A company needs both capital and labor, but we currently reward only one.
88
The United States should pass a law that a CEO cannot make more than 50 times the lowest paid employee in a company. Also, anyone who makes more than $5 million per year should be taxed at 90% above that amount.
114
I recently read that Oregon? passed a tax bill that increases the percentage of taxes a company must pay when their CEO's salary exceeds a certain amount over the median worker's.
I think this is great idea--not only does it gain extra money for the state from companies that seem to have a lot to spare, but in doing it this way, it encourages companies to either pay their workers fairly or pay their CEOs less. Win-win.
7
Yeah, well, Seattle tried that. That's why Amazon is starting to leave SEA, and taking jobs with them.
Hope that makes y'all happy. Not sure what would, frankly.
Substitute Beyonce ($115mm/yr.) or LeBron James ($33mm/yr.) for the names of the CEOs. Those two work very hard and have every right to earn as much as possible. That income requires the help of lower-level employees, too. Does the outrage remain? If not, why?
8
I'll bet that no one on Bey's staff or the heavily unionized stagehand and craft unions that produce her shows and recordings is in the taxpayer subsidized food stamp queue with the Wal-Mart cashier and the McDonald's burger flippers.
25
Please. Beyoncé can sing, and for real, unlike most of her competition. We all know what LeBron can do. These CEOs, once past the founder stage, are average guys with political instincts who play golf well. And their boards are no better. They can barely get out of bed sober most of the time. There is no remarkable talent there to speak of, not in them or their boards.
Even stupid people get MBAs.
11
Um.....because they are THE PRODUCT! NOT the roadies or the referees. People don't pay to watch the owners of ball teams.
5
....they don’t have the ability to engage in local politics.
Isn’t that the point?
9
How can one maintain a sense of personal freedom and hope for the future under a system of which you are ashamed?
24
I'm sure this "CEO to average salary" regulation part of Dodd-Frank is on Mnuchin's and Mulvaney's hit list for elimination. That darned overregulation of the swamp killing jobs and all that.
12
This fact-based scenario should be attached as an addendum to Robt. Kuttner's books -- especially Everything for Sale --about contemporary capitalism's inequities and inanities. Anybody attracted to the amoral Social Darwinism of the Libertarians should read it as well.
5
Employee profit sharing programs may be an answer.
These programs require that the same percent of salary (up to a limit) be given to all full time employees. The amount is significant, around 30 percent. This allows employees to share in a company’s success.
Would it be out of line to suggest that any public ally held company where the top executive who makes more than 250x the average implement a profit share program?
7
And if there is a loss, will employees have to share the burden under your plan?
1
As they do now? As when a company falters workers are laid off or get no raises?
8
Corporatist greed killed the planet.
33
Amen .... you said it all.
1
The pay ratio is precisely what is wrong with this messed up country. There is no way anyone needs that much money. And most of the employees don't have benefits since they are increasingly contract workers. Our morals are really screwed up. And CEOs who mess up and leave get huge pay packages for messing up.
57
Low wage workers cost the US taxpayers $152 billion a year in public support for working families.
151
Walmart has 2.3 million employees. Divide their CEO's entire pay equally amongst them and they all would receive an extra $9.56 per year. Modern executives earn more because they technology has afforded them great operating leverage. Yeah, it still looks bad.
5
I see nothing wrong with rewarding CEOs and other top executives a large cut of corporate profits. After all, it is their leadership which helps decide the corporation's direction and therefore success is, at least partially, attributable to them.
However, we need progressive tax laws in effect to redistribute a large portion of these salaries to healthcare, infrastructure, schools, food-aid, public housing, and other social services for all Americans, rich and poor. In other words, would it really matter that your CEO makes 2000x the amount you make if all basic needs were guaranteed? If all American children had the right to attend world-class public schools, if there was a guarantee of housing, food, the ability to visit a good doctor, and to drive there on good roads ...
The erosion of our social safety nets is the real crime here - not the disparity between employee:CEO compensation.
19
After reading this article, I cannot think of a stronger reason for Union representation in the workplace.
232
Unfortunately, unions become weaker and more impotent as the number of "right to work" states increases.
7
Like the V.A.? Are you joking?
That's one way voting makes a difference. "Right to work" laws (which really means "you can be fired for anything without cause") are passed by state legislatures.
While I think that CEOs are paid far too much money in general, I do think that they should be making quite a bit more compared to the median salary of their company. If a company is paying good wages (with good benefits) and all of their employees have a good standard of living for the city they're in, then I don't see what's wrong with a CEO getting paid quite a bit more. But until all of those things are met, there's no reason why they should be receiving millions or tens of millions in bonuses (or stocks). I don't really care about the inequality in salaries as much as I care that all of a company's employees are taken care of with good pay and benefits. If everyone's taken care of, and money is being spent responsibly for the company, then sure the CEO can get additional compensation. I just don't think it's right if a CEO is rolling in dough while employees are suffering and can't make ends meet.
26
America cannot afford such inequality of wealth.
Thomas Jefferson wrote about how, as governor of Virginia, he changed inheritance laws to avoid "an aristocracy of wealth."
We should work against such devolution of democracy.
66
Excellent point. While fewer workers have pension every year, many CEO have astronomical pensions. They aren't about retirement security, they're about intergenerational wealth transfer.
6
What more proof is needed that the capitalist system as it exists in the good old USA is flawed and failing our citizens?
72
Analyses like this only serve to foster class warfare. Why begrudge anyone for what they earn? Sounds more like jealousy of the NYT writers and editors than raising a serious issue.
Everyone in a corporation is part of a team (I speak as someone who has started and run two companies, having employed dozens). The executive's job is lead the team, to assure everyone else on the team _has_ a job by growing and sustaining the company. Certainly, that's a valuable role, yes?
This comparison between the highest-paid and those lower paid doesn't do anything other than turn rank-and-file workers and their sympathizers against the executives. But, NYT, maybe that's your point.
1
Real wages for working people have flat-lined since 1979. The class warfare you abhor has already been waged by the corporate greedsters. BTW, low wage workers cost the US taxpayer $152 billion per year in public support.
93
Why begrudge anyone for what they earn? Because the few at the top have held wages down for years while increasing their own compensation. Because the few at the top made their employees pay more and more of insane cost of health care while paying less themselves. Because the few at the top have no qualms about replacing their US employees with cheaper foreign workers and expect the government to take care of the results here at home. It's amazing that no actual warfare has broken out.
25
Envy of the wealthy is a conservative canard. It's not that some people have more (a lot more) money than others that's the problem, it is that those at the top feel no compulsion to help those ON THEIR "TEAM" at the bottom while raking in more money than anyone could possibly ever need in a lifetime. Corporations thrive because the team called Citizens of America pays taxes to support the building blocks of society that allow those corporations to thrive. In return, the least these overpaid corporate leaders could do is to help sustain this society through fair pay and support of a safety net for those who need it rather than fighting tooth and nail to hoard their and their friends' obscene wealth.
16
google: NYT George Romney when the rich said no to getting richer
4
And this is a problem......why?
Last time I walked in the woods, I saw some trees 300 times taller than other trees. So what. It's called a bell curve.
3
Right, our society's permitting and encouraging gross plutocracy is the same as following Newton's gravity law i nature. Nothing we can or should do about I guess. Silly me!
19
It is a problem when they receive SNAP (food stamps) at the expense of the regular taxpayer. They call it Corporate Welfare.
17
The distribution lacks the symmetry of a bell curve. The distribution is highly skewed due to the extremely high compensation of a small number. I believe this is the point of the article.
7
This is only true if both salaries remained constant over those hundreds of years. The CEO's salary when I started my career was 27 time what I made. Yet when I retired, the CEO's salary was 184 times what I made... I fear the average employee will never make what the boss makes, even given an eternity.
84
your experience is typical...despite what other commentators say no one begrudges CEOs making much more that the average worker, but the numbers now are just absurd and surreal...
17
It is truly the new Gilded Age. No one and I mean no one is worth being paid tens of millions of dollars per year. Except maybe the person that can bring world peace. Think about it. A hedge fund manager can make a billion dollars a year. Yet they produce nothing of tangible value. They make money from money which does not advance science or technology and serves no purpose for society except to enrich the already rich. It’s as if our priorities are all upside down. We don’t pay teachers for perhaps the most important job in society yet we reward those who really add nothing of value to our society like hedge fund managers. This will be the undoing of our capitalist society if it’s not rectified.
391
Hedge fund managers may be overcompensated, but they do create value. They decide which companies are most likely to produce the highest returns and invest in them, which helps the economy since the money is invested optimally rather than randomly.
1
If we were truly a nation of Judaeo-Christian values, then we would still execute financial criminals for usury. But it’s not as if these things are actually taken seriously by anyone, right?
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Wish I could recommend this, oh I don't know, 2 billion times. It might give me a small idea of what it's like to be a hedge-fund manager on a comment board.
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We are all too accepting of this, as we are of all the other things that, historically speaking, eventually led to the French and Russian revolutions.There is still a ways to go, but watch out for that well armed militia.History repeats itself.
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That well armed militia belongs to the monied class. The money lovers got us by the short hairs. Resistance, at least the violent kind, is futile.
Apply this little pearl if you can...
"Baseball is ninety percent mental and the other half is physical." - Yogi Berra
It seems to me we can only change it by changing our culture's thinking.
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Another way to look at this comparison is to put it in terms of the number of employees at mid-level within the organization. For example, based on CEO and median pay for employees at Live Nation Entertainment, Michael Rapino is worth as much to the organization as 2,893 mid-level employees.
I wonder what would be the effect on profits for the company if they lost 2,893 mid-level employees with remaining employees trying to take up the slack as compared to losing a CEO and administrative employees taking up the slack
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That sliver of 2,893 employees are more easily replaceable. They can be outright downsized, shifted to off-shore subcontracting, their tasks can be automated, or the workload can be reassigned to others at minimal cost. The pool of CEO's that can deliver maximum ROI (whether delivered or not) is much smaller.
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Really? Ever tried staffing for 3K people? So virtually the entire company is worth nothing then and we can virtually shut it down save the CEO? Not even a digital company like Facebook can do that. You are erroneously over-simplifying.
And they probably end up actually paying a lower percentage of income in Taxes, than most of their workers. After all, they are the " makers " and Job Creators. Sad.
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What's even crazier to me is the astronomical leap in compensation between executive management and middle management in a corporation who actually manage personnel and operations, have specific subject matter expertise, make day-to-day decisions, etc. There's no graduated compensation scale. It's also crazy that executives rather than highly educated professionals rendering socially important services are the most highly valued in our society.
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At the heart of this is effort and quality. As an example, is a CEO or someone at a similar rank worth 2 thousand times as much as someone at the median pay? When they work do they do 2 thousand times as much in work, effort, and quality? I highly doubt it. There should be federal laws limiting how many times greater than the median pay a CEO can get. Theses share holders might see a bump in value with all of that money that would otherwise be wasted on their CEO.
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While I understand your point of view, it's not all about effort and quality of work. A janitor could put in just as much "effort and quality of work" as a CEO but you can't possibly think that they should make the same amount of money. What that work is and how much value that work brings to the company is a huge aspect. Also, the level of education and know-how (and how long it takes to get that know-how) are also important factors in pay. I think that all employees should be able to make a salary that provides a good, decent standard of living, but I certainly don't think everyone should get paid the same or roughly the same. The CEO could bring about a 2000% increase in a company's profit, but that's never going to be true for a janitor.
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I understand the idea of value and level of education and for the record I don't think people should get paid the same in a company. The issue is that the idea of value and education, while they can be understood are still abstract concepts when adding a dollar amounts to them just like when someone goes into the doctor and they get a bill - it's hard to determine the exact value of something like this. Even if a CEO brings a 2000% value, 1) that is their job to increase value of the company 2) the janitor and all of the employees all helped in that endeavor to some degree. You don't hear about the janitor getting a huge bonus for cleaning extra toilets, or companies breaking the bank to find the best janitors. A huge part of CEO salaries sky-rocketing is fear of a company not getting the "best pick", while lower-paying jobs are completely foresaken in the world of competition. Shareholders should look at the workforce and not just make a devil's pact with a particular CEO.
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So tell me again, conservatives, why we shouldn't tax out-size incomes at comparable rates? The GOP has created, as intended, a new generation of robber barons, and too many ordinary Americans have been duped into thinking this is okay. Is anyone's work product worth a million dollars a day?
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I can't answer for "conservatives" but as one who considers himself a realist I will answer this way: The word "should" has little impact in this world. We are governed and must plan our personal lives according to what "is." Work where you get paid best. Invest where the return is highest.
In the world of "what is" large corporations (or those who run them) no longer are national in fact or thinking. They are entities unto themselves. They are global and easily can and will shift their global corporate headquarters to the least-taxed, least-regulated countries if pressured. They can! They know that. They can show profit where they choose to show profit and squirrel it where they choose to squirrel it.
I speak from experience. I once worked for one, deeply enough inside to see how that can be done.
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Underpaying workers is really a very short sighted move by these corporations, most of whom rely on consumer spending for their profits. Workers spend a much larger percentage of their incomes, they drive the economy. Pay them more and the economy expands. Billionaires also spend, but they only need so many giant mansions and so many giant yachts. Their impact on the economy is much smaller.
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As a matter of routine, when I am voting as a shareholder, I vote against all recommendations for management compensation. Recently, I've also started to vote against all men on boards that share fewer than 50% of the board seats with women; so far I have encountered none with equal representation. This insanity must stop!
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And I thought I was the only one. But judging from results it must be just the 2 of us.
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No, I do the same.
Me too! Company executives work for us shareholders. Now if only Trump's cabinet and Congress realized whom they report to.
Based upon 2080 hours per year the CEO of First Data makes, per hour, what the average First Data employee makes PER YEAR.
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