CEO pay is irrelevant to you

What do you think of the following? What’s ridicules is the claims made. First, the CEOs referred to are not all CEOs, but the few that work for Americas several hundred largest corporations. If the compensation of those CEOs – most of which is in stock awards – were zero, it would have an insignificant impact on each worker. The CEO pay is not at the expense of workers, but shareholders.

Do the math as I did. Look at the CEO compensation of a S&P 500 company and divide it by the number of workers and see the impact.

Sen Warren ignores the impact of non- cash compensation which is one of several factors limiting pay raises. According to BLS-generated compensation cost indices, total benefit costs for all civilian workers have risen an inflation-adjusted 22.5% since 2001 (when the data series began), versus 5.3% for wage and salary costs. Most of that coming from health care benefits.

We’re in this fight because our economy is rigged in favor of the ultra-wealthy and corporations, which means workers get the short end of the stick. Thanks to EPI’s research, we know that today, the CEO-to-worker compensation ratio is a ridiculous 351-to-1. The escalation of CEO compensation has fueled the growth of the top 1.0% incomes at the expense of U.S. workers, widening the gap between very high earners and everyone else.

We also know that, while worker productivity grew by 61.7% between 1979 and 2020, workers’ median wages grew by only 23.1%. For Black and Hispanic workers, wage growth was even slower, at 18.9% and 16.7%, respectively. You know what those numbers scream out to me? That we need to put more power in the hands of workers and boost wage growth to level the playing field and reduce racial and ethnic inequities.

Elizabeth Warren From e-mail seeking donations for the Economic Policy Institute 12-28-21

The US labor force is 157 million of which 22.5 million are government workers. The large companies of the type referenced for CEO pay employ about 17% of all workers.

CEO compensation has nothing to do, no impact, on the workers of America. The large numbers – and sometimes underserved pay of CEOs – presents an easy target to push the notion of a rigged, unfair economy as Sen Warren believes, nothing more.

6 comments

  1. Liarwatha should be complaining about how much employees of the federal government get in pay and benefits. At one time, good benefits made up for lower pay, but now both exceed what the public gets.

    Liked by 1 person

  2. Average CEO pay = < $160,000, data as of December 2021. See:

    https://www.payscale.com/research/US/Job=Chief_Executive_Officer_(CEO)/Salary

    Was Steve Jobs overpaid?

    Was Bill Gates overpaid?

    Pocahontas is jealous, envious…

    If she had been the CEO of Apple or Microsoft, those firms would have suffered, not grown, and our standard of living (yes, you, me, all of us) would be worse, much worse.

    I too am jealous. The difference is that I am jealous with respect to the talent and/or risk taking and/or vision of guys like Jobs or Gates.

    Unlike Pocahontas, I don’t have the ability to inappropriately invoke government power. She doesn’t represent me.

    Sooner or later, her kind of sh**, threats, are gonna screw over lots of everyday workers – when the firms relocate elsewhere (Ireland, Singapore, etc. ) and the new CEO’s send our jobs to Mexico, China or Vietnam – where workers will be happy to take less.

    Liked by 1 person

  3. My problem with CEO pay is not the amount of the pay, but the other perks, whether they retire, move on, or are fired for poor performance. Straight forward taxable or deferred pay is one thing, but the really costly perks are quite another. If I got fired, I’d get nothing. If a CEO gets fired, he takes millions with him.

    Liked by 1 person

  4. “The large numbers – and sometimes underserved pay of CEOs – presents an easy target to push the notion of a rigged, unfair economy as Sen Warren believes, nothing more.”

    Mostly true.

    And mostly a straw man argument. Granted, redistributing the pay, cash or otherwise, of one man to thousands of employees will not affect their individual income significantly. It does not logically follow that the economy is –not– “rigged and unfair”.

    It is simplistic for Warren or others to imply that, and arguably politically effective. The economy is much more complicated. One of your commenters used the phrase “Despite scholarly volumes…”

    Despite, indeed. There are scholarly volumes to support or refute any given economic principle, most fall under the heading TLDR. But the image of multiple homes and multimillion incomes vs. a family of four with two incomes surviving in a two bedroom home or apartment is visceral. Maybe too visceral, if it results in class warfare, instead of reasonable reforms.

    An equally “easy target” is that same four person household barely surviving on two incomes, with no savings, one emergency away from disaster. For the most part, they are not there because they are lazy, ignorant, or otherwise inferior. And the work they do is vital to the economy. An intelligent society/economy/government would ensure that they are well cared for, even if it meant the CEO, CFO, CPA, etc. each had one dollar less. Or one vacation home less?

    Liked by 1 person

  5. I had to read this comment twice, to parse the grammatical and spelling errors. CEO pay comes from company assets, reducing dividends for investors, but also from workers pay. It’s the modern equivalent of feudal enterprises, where the local leader (baron, earl, duke, etc.) effectively controlled the land and the wealth, and the workers were effectively slaves.

    Liked by 1 person

  6. I never had a problem with CEO pay to worker ratio because irrelevant. A CEO of factory workers can’t compare to a CEO of a law firm. The number of workers and wages are paid quite different.

    I never, ever have a problem with company founders pay. They took the risks and they earned it.

    My problem is that the some of the compensation for CEOs does not match their performance or their value but corporate boards claim that they have to pay these competitive rates and bonuses. A CEO that leads it’s company to bankruptcy should not be paid in my opinion.

    I have more of a problem with politicians who entry congress poor and after a few terms are millionaires. They didn’t get rich on government checks. Where did they get their money? Art work?

    Like

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