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Tilted Cat Head
Administrator
Location: Manhattan, NY
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Quote:
Originally Posted by robot_parade
What bothers me is that I'm very often seeing articles and studies that show that CEO compensation is at a much higher level than it has ever been before, and that CEO compensation is rising at a rate far higher than 'normal people'. I don't think it's a healthy system. And especially concerning is that rising corporate profits don't seem to have any effect on worker salary. Also that CEO's actual performance (in terms of corporate profits) don't seem to have any relationship to their compensation - we've all heard of the 'golden parachute', where even if a CEO is kicked out for utter incompetence he or she gets lavishly compensated.
For instance:
Executive Pay: CEO Pay Up 298%, Average Worker's? 4.3% (1995-2005)
So, if that article is correct, since 1990, corporate profits have doubled, CEO pay is up about 300%, and the average worker is making...4.3% more.
Why? |
Maybe the average worker needs to save their money and invest in the company. I know many people who have done just that even when household budgets were tight. We're talking about a long term plan and long term goal. Buying new shoes because you like the new fashion gets you nothing in 5 years except for a pair of 5 year old, unfashionable shoes.
Why does it seem to be that immigrants (both illegal and legal) seem to be able to better themselves and their position over time both fiscally and socially than those that are born here?
Quote:
Originally Posted by Baraka_Guru
Profits are up maybe because of CEO decisions that both save money and increase revenues. 
But in regards to the average worker, a 4.3% increase is more than double the average annual rate of inflation for that same period, so workers are generally better off. I doubt you could have increased worker pay by as much as 300% and still maintain profitability. Even something like 5% or 6% would be unsustainable. Worker cost is generally a high one as an overall percentage of business costs.
I know it doesn't sound fair, but I will repeat what I said in my previous post: This is more market-based than based on "fairness," whatever that is.
EDIT: I just realized that this is a "cumulative" increase, which means inflation has eroded worker earnings by as much as 16% to 18% over the period. Okay, well, that sucks. Fine. But I still say this is market-based. I blame globalization. |
Globalization is the problem, but so is the desire for record profits every quarter. It's unsustainable. There has to be blue chip type growth that is slow and steady. But we pay the CEOs these sums because we want the record growth to be there.
Quote:
Originally Posted by boink
decisions like...let's close the factorys and have all our product in some forign land with no labour or enviormental regulation and then let's take all our money and stick it in a bank in the Camen islands so we don't pay taxes on it.
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People need to make the decision on their own. As a shareholder, I expect a fair return for my investment. If I don't, I move my investment dollars elsewhere.
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