Misguided political attacks on CEO pay

“Hostility to corporate CEOs may never entirely subside,” John Tamny writes for The Wall Street Journal. “Democratic presidential candidate Hillary Clinton, for example, has spoken about the struggles of the average American family ‘when the average CEO makes about 300 times what the average worker makes.’ Rolling out her economic program on July 13, Mrs. Clinton promised policies that would be better for ‘hardworking families, not just for successful CEOs.’ Yet much would be gained if the public better understood the logic behind business leaders’ seemingly outsize compensation.”

“When Robert C. Goizueta took over Coca-Cola in 1980, the company was worth $4 billion. When he died in October 1997, the company was worth $145 billion. Goizueta transformed a global brand,” Tamny writes. “A few months before Goizueta died, Steve Jobs returned to run Apple Computer, the company he co-founded in the 1970s. Apple had been a highflier but was hurtling toward bankruptcy, and Jobs was brought in to fix what appeared irretrievably broken. Soon enough the innovations that have defined the modern Apple began to roll out. First was the iMac, followed by the iPod, iPhone and iPad. Jobs died in 2011, and while he did not live to see it, Apple is now worth $746 billion, the most valuable company on earth.”

“Goizueta died with an estimated net worth of $994 million thanks to his Coca-Cola stock. Jobs’s 5.5 million Apple shares were estimated to be worth $2.1 billion when he died,” Tamny writes. “The achievements of Goizueta and Jobs help explain why CEO pay is so high. Since one man or woman can potentially affect the fortunes of a corporation to the tune of hundreds of billions of dollars, CEO pay mirrors what is possible—even though it is by no means certain.”

“Yet compensation does not always match performance. Exhibit A is former Home Depot CEO Bob Nardelli. Despite $64 million in pay, and a share price that languished during his six years at the top of the retail giant, Mr. Nardelli’s forced departure in 2007 came with a $210 million exit package,” Tamny writes. “Perhaps incoming CEOs should be paid the way company founders are generally compensated. If chief executives were paid mostly in company stock, and comparatively little in annual salary, then the interests of the CEO, the shareholder and the worker will be much better aligned.”

Read more in the full article here.

MacDailyNews Take: It’s tough to argue that Steve Jobs wasn’t, and Tim Cook isn’t, worth every single penny and then some. Plus, of course, Jobs famously took only $1 in annual salary. The rest of his compensation was in Apple stock (and a Gulfstream jet, of which the operating costs were reimbursed to Jobs when the aircraft was used for Apple business. That jet was sold by Laurene Powell Jobs to none other than Jony Ive.)

[Thanks to MacDailyNews readers too numerous to mention individually for the heads up.]

42 Comments

  1. Hillary Clinton’s net worth: $32 million.

    Hillary Clinton is a fraud.

    If you happen to see the Bill Clinton five minute TV ad for Hillary on YouTube, he introduces the commercial by saying that he wants to share some things we may not know about Hillary’s background – beware.

    As I was there for most of their presidency and know them better than just about anyone, I offer a few corrections;

    Bill says: “In law school, Hillary worked on legal services for the poor.”

    The facts are: Hillary’s main extra-curricular activity in law school was helping the Black Panthers, on trial in Connecticut for torturing and killing a federal agent. She went to court every day as part of a law student monitoring committee trying to spot civil rights violations and develop grounds for appeal.

    Bill says: “Hillary spent a year after graduation working on a children’s rights project for poor kids.”

    The facts are: Hillary interned with Bob Truehaft, the head of the California Communist Party. She met Bob when he represented the Panthers and traveled all the way to San Francisco to take an internship with him.

    Bill says: “Hillary could have written her own job ticket, but she turned down all the lucrative job offers.”

    The facts are: She flunked the DC bar exam, yes, flunked, it is a matter of record, and only passed the Arkansas bar. She had no job offers in Arkansas, none, and only got hired by the University of Arkansas Law School at Fayetteville because Bill was already teaching there. She did not join the prestigious Rose Law Firm until Bill became Arkansas Attorney General and was made a partner only after he was elected Arkansas Governor.

    Bill says: “President Carter appointed Hillary to the Legal Services Board of Directors and she became its chairman.”

    The facts are: The appointment was in exchange for Bill’s support for Carter in his 1980 primary against Ted Kennedy. Hillary then became chairman in a coup in which she won a majority away from Carter’s choice to be chairman.

    Bill says: “She served on the board of the Arkansas Children’s Hospital.”

    The facts are: Yes she did. But her main board activity, not mentioned by Bill, was to sit on the Wal-mart board of directors, for a substantial fee. She was silent about their labor and health care practices.

    Bill says: “Hillary didn’t succeed at getting heal th care for all Americans in 1994 but she kept working at it and helped to create the Children’s Health Insurance Program (CHIP) that provides five million children with health insurance.”

    The facts are: Hillary had nothing to do with creating CHIP. It was included in the budget deal between Clinton and Republican Majority Leader Senator Trent Lott. I know; I helped to negotiate the deal. The money came half from the budget deal and half from the Attorney Generals’ tobacco settlement. Hillary had nothing to do with either source of funds.

    Bill says: “Hillary was the face of America all over the world.”

    The facts are: Her visits were part of a program to get her out of town so that Bill would not appear weak by feeding stories that Hillary was running the White House. Her visits abroad were entirely touristic and symbolic and there was no substantive diplomacy on any of them.

    Bill says: “Hillary was an excellent Senator who kept fighting for children’s and women’s issues.”

    The facts are: Other than totally meaningless legislation like changing the names on courthouses and post offices, she has passed only four substantive pieces of legislation. One set up a national park in Puerto Rico . A second provided respite care for family members helping their relatives through Alzheimer’s or other conditions. And two were routine bills to aid 911 victims and responders which were sponsored by the entire NY delegation. Presently she is trying to have the US memorialize the Woodstock fiasco of 40 years ago.

    — Dick Morris, former political advisor to President Bill Clinton

    I continue to pray daily that Hillary waltzes to the Democrat Party nom and runs unvetted and totally unprepared. Please, God, please!

    Yes, companies should tie CEO compensation to performance. I’m all for that. I’m not at all for the U.S. gubmint forcing enterprises to do so.

    1. I have a PhD in Clinton and have met both Bill & Hillary as I took my 1st 2 years of college in Arkansas.
      Again- I the United States there is not a Democrat Party. There is a Democratic Party. But then maybe you were home schooled like a good little NeoCon bot.

      Ms Clinton is worth far more than that as the Clintons have earnings from speeches alone well over $100 million.

      Next, toe sucker Dick Morris of Faux Newz is doing what all the GOP echo chamber is currently working on – trying to damage Ms Clinton as they know she polls well with many Republicans.

      Ms Clinton is a Wall Street DINO who should be in the GOP. She was and still is the Goldwater Girl.

      1. Actually it is officially called the “Democrat” Party as in The Republican Party and The Democrat Party. The word democratic can be used to describe some forms of government but not to describe a party. It is only used by the lazy, uninformed, and uneducated.

        1. Nice try. Take a look at the Official Website.
          https://www.democrats.org
          Scroll down the page to where it says plainly:
          OFFICIAL WEBSITE OF THE DEMOCRATIC PARTY
          DEMOCRATIC NATIONAL COMMITTEE
          430 South Capitol Street Southeast
          Washington, DC 20003

          Not Democrat National Committee- Democratic. Stop believing all the bullshit Rush spouts. His High School Diploma is not very impressive- nor are his shrinking ratings.

    2. Is this an Apple forum or a political one? If I wanted to read about Hillary Clinton I’d go look her up. Your hard-on for the conservative movement has no place here.

      1. You don’t need to look anything up about Hillary. She’s been an unethical liar since the 70’s when a Democrat, looking into Nixon, fired her from his committee for lying and unethical practices. Nothing’s changed about her from then to today!

  2. Making executive pay public information only made things worse. CEOs’ salaries are determined by their companies’ boards of directors. Every company likes to think they have the best CEO among their competitors and will want to reward him accordingly. When it is time to review CEO’s salary, they will look at the competitors’ salaries and inevitably award their own guy more than at least half of the competition. Giving him less than what majority of competitors get tells the world that the board has little faith in their own CEO. If the company has performed well, the justification for any increase is easy. When the company does poorly (such as Microsoft or blackberry) the boards usually say the increase is a necessary motivator for the CEO and push it through regardless.

    This perpetual cycle of increases of executive pay, with boards one-upping each other rapidly continues to further expand the artificial and ever-growing distance between ordinary employees, who get paid largely on merit, and CEOs, whose pay is always going to be adjusted to be higher than most of the competitors, regardless of their own performance.

    1. Flaws in this article:
      * Attempting to focus on emotion (“hostility”) rather than the facts
      * Using Steve jobs and Robert Golzueta as representative CEOs. Steve Jobs is clearly atypical, and it is disingenuous to use him as rationale for general CEO pay levels
      * Attributing the majority of the success of these companies (or any company) to one person. The CEO certainly plays an important role, but so do many other people, from management down to the white collar and blue collar employees.

      Upper corporate management operates under a completely different set of rules. They are treated somewhat like sports superstars, except without a salary cap. They are always rewarded – for success, for failure, for getting kicked out and replaced – only some times more than others. They earn millions seven when they harm a corporation and its employees.

      I agree that good CEOs deserve good compensation for good leadership. But the income distribution disparity in the U.S. is approaching a crisis point. There is nothing wrong with being wealthy. There is everything wrong with concentrating wealth at the expense of the poor and institutionalizing the laws/rules to maintain that disparity.

  3. A CEO’s compensation should be be tied to the health of the company but not entirely based on stock value. The stock market is driven by many forces that are not aligned with corporate. During the last big market crash when Apple’s stock dropped down into the 80’s Apple still doing well as a company but the market is the river upon which all boats float.

    1. Also, stock price can be manipulated.

      Many companies have had their stock price go up after massive layoffs because that cuts expenses, therefore increases short-term profitability (& CEO pay, if tied to stock price).

      Long term, it may be bad for business in some cases, so companies need to take care that they don’t incentivize greedy CEOs to do things that at be at selfishly good but bad for the business.

  4. Goizueta and Jobs were not “average CEOs”, so using their successes to argue for high pay for all CEOs makes no more sense than saying all workers should be paid at the same high rate as the most productive, talented, and successful worker you can find. The logic is flawed. In an ideal “capitalistic” system everyone would be paid based on their “productivity”. One of the hard problems is how that “productivity” is measured. Apple does not measure their successes based on quarterly earnings, and neither does Wall Street (obviously), so that is clearly not a universal metric. In the current system CEO and executive pay and bonuses are clearly not tied to productivity or success, as we all observed, and tax payers payed for when we had to bail out Wall Street just a few years ago.

    It is undeniable to anyone who looks at the facts that the divide between the most wealthy and the average American has grown tremendously over the past 3 decades. As our National debt has grown past $13 Trillion, the wealth of the most wealthy 0.5% has grown by a suspiciously similar $13 Trillion.

    Neither political party is addressing this issue in a productive manner. Both parties are more concerned with which has a majority than in working for the welfare of our country. The “Borrow and Spend” policies of the Republicans are no better than “Tax and Spend” policies of the Democrats. Government has actually grown more under Republican administrations over the past 2 decades than under Democrats. The radicalization of both parties has resulted in political gridlock, partisanship, and divisiveness that is tearing the fabric of our nation apart from the “fringes”. I wish we would all vote next for a person instead of a party, get some “Independents” elected, and drive a stake through the heart of the destructive partisan politics.

    1. The $13 Trillion is largely the consequence of the perpetual one-upmanship of boards of directors with respect to CEO pay (mentioned above). And that money must come from somewhere, so it comes from the salaries of regular workers. With the exception of few exceptional companies who reward their workers based on their merit, vast majority of public sector in America has been struggling to find the money to reward their CEO better than the competitors’ to the point of generally raiding the benefit packages and actual salary of the rest of the work force. The purchasing power of 99% of gainfully employed Americans has steadily decreased over the past three decades, just as the real (inflation-adjusted) value of executive rewards had rapidly increased.

      I would be really interested to hear what could possibly solve this obvious problem.

    2. There is nothing for political parties or the government to address.

      Wealth is not a zero sum game. What others make doesn’t affect you and is, frankly, none of your business.

      The #1 problem in the U.S. and much of the word: Jealous people who covet what others have and who are way too concerned with other people’s business and not concerned enough about themselves. Mind your own business for a change and perhaps you’d be doing well, too.

      One more time, repeat after me, occupiers: Wealth is not a zero sum game. Lowering CEO pay through some imagined “law” wouldn’t add a single penny to your piggy bank.

      1. But repeating the same fallacy doesn’t suddenly make it true.

        Wealth IS a zero-sum game. Corporate profits have steadily grown over the past three decades. CEO pay has grown significantly faster than corporate profits during that time. Take-home pay of corporate workers has declined during the same time, while their working hours have increased. In other words, workers worked longer hours, for less money, generating higher and higher profits for their companies, and took home less money for that, while their CEOs took home significantly more.

        Make no mistake: in America (as well as elsewhere), greed is endless and overriding. People will keep as much money for themselves as they can get away with. When you are in a position where you can make decisions who gets how much, you will take as much for yourself as you possibly can, giving the others as little as you possibly can. The only forces that can keep such greed in check are organised labour, and/or legislative action.

        While this may be fairly close to the question of jealousy and entitlement, it is, in fact NOT the case. When you take human emotions out of the equation, what makes perfect sense is when the workers who contribute to the growth of the company share proportionately in the rewards from that growth. Such sharing ensures motivation and commitment of those workers. Studies have shown that general worker satisfaction has steadily decreased over the decades; people who used to be happy with their jobs no longer are, but feel they have no choice. And one of the most significant factors to that dissatisfaction is the visible growing disparity between their own purchasing power and that of their CEO and senior management team. Happy people don’t care much how obscenely rich their CEO is; and ironically enough, it takes rather little to make them happy: reward them if the company is growing. Because of the perpetual arms race with CEO pay, very few companies can afford to reward their workers after rewarding their CEOs and executive team.

        Limiting CEO pay increases, either through legislation or any other means, would certainly NOT demotivate those CEOs to the point of driving companies into the ground, but would result in a significant change in worker’s morale. After all, when CEO’s salary is equivalent to 350 average workers, ten percent reduction in that million dollar reward package will allow 350 people to get 10% raise. For a person scraping a living on $30k per year, extra $3,000 makes a noticeable difference.

        The issue isn’t about 10% reduction in order to give 10% raise to 350 people. It is about reining in the cycle of CEO pay raises that is completely out of control. Everyone agrees that in America today, growth of CEO pay has long ago stopped being proportionate to corporate performance. Sooner or later, something will need to be done to bring it under control; otherwise, erosion of worker’s morale, which is already seriously showing, will gravely affect productivity, creativity and innovation in American industry.

        1. I have to re-iterate this, lest it be lost among the other points.

          Wealth IS A ZERO-SUM game. There is no infinite pool of money in corporate profits that allow corporations to reward their senior management team as lavishly as they wish without consequence. Any corporation, even the most profitable ones, have a finite amounts of money. For someone to get paid more, someone else must be paid less. When profits grow, if everyone’s pay is increased proportionately, everyone’s pay would grow. But this is not what majority of corporations in America do today; most will spend those profits on rewards to the senior management. What’s worse is when companies lose money (whether in a single quarter, or worse, over a longer period of time); boards will continue to increase executive pay, in order to match or out-reward competitors’ executive pay, while laying off work force or reducing pay packages to other workers, because there is only so much money in the bank that can be spent on salaries.

          For someone to get larger piece of a pie, someone else will get a smaller one, because the pie has a fixed size.

          1. You’re not too bright, so I’ll make it even simpler for you.

            Apple cash on-hand upin Steve Jobs’ return in 1997: ~$1 billion. Apple cash on-hand today ~$200 billion.

            That wealth was created out of thin air, thanks to ingenuity, sticktoitiveness, and hard work. Things that are sorely lacking in the U.S. and some other places, where lazy asshole statists expect the gubmit to play robin hood for them. You’ll never get rich on gubmint handouts, dummy.

            Wealth is not a zero sum game.

            1. I have to re-iterate this, lest it be lost among the other points.

              Wealth IS NOT A ZERO-SUM game.

              As has been proven by Apple (and with free market economies the world over) the pie is not a fixed size. Obviously.

              But, the Dem/Lib/Prog/Statists will nonetheless insist that it is, because if you don’t believe that fallacy, then you won’t waste your vote on the false, never-fulfilled promises peddled Dem/Lib/Prog/Statists.

            2. It is truly remarkable how stubbornly you continue to shove the head in the sand, or plug your ears and yell “la, la, la!”, rather than admit that you are wrong.

              For the last time: WEALTH IS A ZERO SUM GAME. For somebody to get paid more, somebody else will get paid less. A pie is NOT infinite in size. It may grow over time, but the size will ALWAYS be finite, and some part of it will go to one person, and some other to the other. If CEO takes 20% of profits for himself, then the remaining 5,999 workers can get the remaining 80%. But if he takes 35%, those others simply cannot get 80% anymore. The sum will ALWAYS be 100%. I am sure you understand that.

              I am pretty sure everyone here will agree that Steve Jobs was a profoundly unique businessman and CEO. He would have certainly deserved a good share of that profit pie. And yet, he took practically none ($1 per year). Instead, he received ownership in company (i.e. stock). Jobs is the most irrelevant example to use for American business, since his (and the Apple’s) example is unique and impossible to duplicate in every respect. When we exclude Apple and look at vast majority of other companies, public and private, you get the picture: if you want to lavishly reward your CEO, you have to take that money from somewhere (someone) else, since the pie is of a very specific size — ZERO SUM game.

              And none of this has discussion has anything to do with your American politics. It is truly sad that on a tech-focused forum, discussing something that is rather non-political (executive pay), you find the way to derail the debate into your parochial American political slug fest. The moment you invoke your political paint (whichever colour, red or blue), you invalidate your arguments.

            3. I’m sorry, but you are wrong. I pity you. I pity your “education.” And I hate your “teachers,” for they have failed you miserably. You cannot base your worldview on a lie. It leads you to constantly make the wrong choices, not to mention vote for the wrong people.

              Here, let me begin to help you:

              The Zero Sum Game is one of the great economic fallacies. It assumes that if one person gets rich, it must mean that someone else gets poorer. That’s reliant upon a static view of wealth. It’s like a pie; the idea that there’s just one pie, and the pie can’t grow. In market economies and dynamic, open economies what you’ll find is that the pie grows. This is very important, because what that means is that everyone can start to get out of poverty. – Dr. Samuel Gregg, Director of Research, The Acton Institute, Australia

            4. You don’t seem to be reading what I’m writing. So, here it is, for the FOURTH time (ahhhh…):

              Regardless of how big the pie may grow over time (and some pies grow quite fast, such as Apple’s), the pie will ALWAYS have a finite size. From that pie, when you give out pieces to people, if you want to give a big piece to one person, you will HAVE to give a small piece to another person. If you want to make the big piece even bigger, you’ll have to make the small piece even smaller.

              When the pie grows, you may get a chance to make everyone’s piece bigger than it was before. The point of this whole discussion is, that’s not what companies do. They keep the small pieces as small as they were before (and many companies make them even smaller) in order to be able to make that big piece even bigger.

              Again, regardless of growth or shrinkage of that pie, the biggest piece will always grow, and it will grow much more than the whole pie grew. And it will grow even if the whole pie shrinks. Because there is no infinite supply of pie at that point in time for that particular company, if the biggest piece of pie is to be bigger than it was before, the small pieces must be smaller than they were before, because of the ZERO SUM game.

              What Dr. Gregg says is an disingenuous little theory. A cursory view of current practices, especially in America, reveals that his little theory holds little water. When companies grow, in most cases, vast majority of that growth goes into rewards packages of senior management. When they generate losses, executive packages continue to grow and money for that is found through layoffs or reduction of benefits to the rest of the staff. This is because the pie is ALWAYS of a specific size. Zero Sum. Got it?

            5. Predrag,

              You make negative sum sense. Listen to 2014.

              Proof (as if any were needed): If money (economic gain) were a zero sum pie then 7,000,000,000 on this planet would be starving by trying to live on the same amount of goods that 10,000 people did before the civilization population boom.

              Even if economics were a zero sum game adjusted proportionally for population growth, we would all be living at the level of cavemen and hunter gatherers.

              So your zero sum is complete nonsense.

              Perhaps you are (incoherently) trying to say that growth is not shared evenly? True enough. But there certainly is growth economic growth.

            6. Does nobody read anymore???

              I wrote five posts about this already, and back comes the same stuff. I thought I was reasonably proficient in English (for a foreigner).

              Regardless of how much that profit pie grows (and sometimes it grows quite fast, as Apple’s does), at any given time, the pie has a specific size and is not limitless.

              If in Q3/2017 Netflix made $76 M in profits (on revenue of $1.7B), there will only be $76M available for salaries and other expenditures. So, if the board wants to give their CEO $8M for that year, there would be exactly $8M less for all others. If they want to give him $12M, they would have to reduce pay to others by $4M more. That is because $76 is a very FIXED number. If you want to reward your CEO more, you have to reward your workers less, because of, wait for it, ZERO SUM.

              Now, in the following quarter, Netflix profits may well rise, say, to $88M. But again, that would still be a fixed number; unless they increase everyone proportionately (in this case, about 18%), which is never the case, they would have to either reduce the increase of pay for workers (so that CEO can get his big bonus or 30% pay increase), or leave it flat for the rest of the workers. This is because, again, $88M figure is not an unlimited figure but a fixed pool of money from which they will reward workers and management.

              The point remains: because money is always a ZERO SUM GAME, in order to sustain outsized executive pay growth, workers’ pay package has to be reduced.

              How difficult is this to understand??

  5. This article is such political BS.

    The author throws around CEOs like Jobs and Goizueta to justify extraordinary pay for ALL CEOs.

    Those two specific examples clearly earned their pay…they revolutionized their companies and led them to new heights. No argument on their compensation.

    But look at the many other CEOs who have done a lousy job (such as just about every *other* Apple CEO except Jobs, for example).

    Most CEOs are presiding over companies who are NOT soaring like Coke and Apple did during the tenures of the above CEOs…and yet receive ridiculous pay.

    I have no objection to a CEO making $500K a year, plus substantial bonuses if company performance is stellar. Maybe even $1M plus bonuses for larger companies…but they better be soaring!!

    Remember that for most (all?) of his second run as Apple CEO, Jobs received $1/year as salary. He made hundreds of millions on his stock options ONLY because he did an incredible job. If he’d done lousy, he would have received his dollar and relatively little more.

    THAT, to me, is the model for CEO pay. Of course, $1 is ridiculously low…$200K-$1M is more reasonable, depending on company size, plus *performance* bonuses tied directly to company health.

    But on the flip side, $10M/year (like some make) is *absurdly* high, especially when that’s guaranteed pay, even if they run the company into the ground!!

    1. I don’t think anyone is blaming the CEOs themselves; it is the boards of directors that are at fault. You can’t blame them that much either, though, for their thought process. Every one wants to believe that they chose the best CEO among all the competitors out there, and the way they want to make it known is to reward their own CEO better than all other competitors. It is a perpetual vicious cycle.

      1. Agreed. Even if most CEO’s are mediocre, corporations have so much money and value on the line that still need to compete in an attempt to get the best leadership they can.

        In a world where many companies have $1 billion of revenue or more, the fact that leaders makes 10’s of millions of dollars shouldn’t surprise or worry anyone. That is nothing compared to the value of protecting and growing such large businesses.

  6. Thomas Piketty’s book, _Capital in the 21st Century_, is required reading for anyone interested in understanding the (terrible inequality) in the distribution of wealth today. One reason for this inequality is the absolutely ridiculous pay levels that professional managers receive their crony boards. (Of course, the boards get their perks in return.) It is a cozy relationship.

    The real question, using Goizueta as an example, is not whether he earned the $994 million he salted away by the time he died. The real question is whether or not he would done what he did for, say, a mere $100 million …assuming, of course, all other CEOs did not earn outsized pay, either.

    Also, the corollary to outsized CEO pay is outsized pay for all professional managers. Call it trickle down largesse.

    And once one CEO gets it, corporate executive compensation consultants come in and justify similarly high pay for the professional managers at other companies “to retain good people”. It triggers an arms race.

    The whole issue is ripe for public debate. At the very least, I see no problem eliminating tax dodges and loopholes for these guys so they at least pay the same rate of tax as their secretaries… But we would all be better off if professional manager pay at the top were to come down to sea level from the stratosphere.

    1. I don’t think inequality is so much a problem as mobility.

      Someone making millions doesn’t hurt anyone else. But when society fails to maintain onramps for low income people to work their way up, then there is a problem for everyone (as underclasses end up harming everyone).

      This is why a non-corrupt legal system, a strong educational system, healthcare for children (not debating healthcare in general here), etc., are so important. They are investments in the country that keep it healthy by giving everyone opportunity.

  7. picking on the wealthy has historically been a very successful strategy for politicians through the ages. It’s easy to do- those mean old rich people need to share, right? That message resonates loud and clear with the ‘majority’- the have-nots. Politicians promise equality in exchang for votes. Who wouldn’t want free stuff? I’d vote for them too.

    Obviously, the hypocrisy is thick. Politicians in this country aren’t suffering, let’s just leave it at that. They’re also extraordinarily dishonest (Hillary is only the most recent and most prolific at this point). On top of that, and perhaps as a result, our government is completely dysfunctional. So the question that I’ve always had is, why in the world do we continue to let them control more and more of our lives?

    ET: I can only assume you’re talking about presidencies when you say ‘administrations’. It’s much more complex than that, but I could just as easily claim, in truth, that the large majority of ‘Congresses’ have been dominated by Democratic rule over the past 100+ years. Either way, our government is a mess, and it’s everyone in DC’s fault, if you want to assign blame. There’s really no difference between tax and borrow in our political system.

  8. The CEOs are not doing it on there own Steve would be the first to tell you he had a great team of some of the best people in the world. If a company is doing well the benefits should be shared not pay cuts for the workers and millions for the Executives. It is not really good to compensate with just shares, because the CEO and his team then spend to much time pushing for short term stock gains, part of that being short changing the staff that make that money because they aren’t getting stock. Pay where the CEO get X times what his employees get so long as the company is making money.

  9. CEO pay should be top notch. But the people that put out the hard work also should be payed better especially to meet the high costs of living. There needs to be more compensation for the regular folks. A company like Apple that works everyone so hard should pay everyone for that hard work better. They are always asking for more work. That’s okay, but the regular folks have to pay bills, high rent, mortgages and need to be compensated better if they want more work done. It needs to be a two way street. When a company is doing so well they should be rewarded for that with more then just a “thank you”. Thank you’s don’t pay the bills. When its all said and done we have our jobs so we can pay our bills and live our lives. Saying thanks is nice but sometimes a bigger raise can make a much bigger difference and I think that motivates better for more work getting done at even better quality. If I get laid off I only get enough to live off of for a month or two. CEO gets laid off they don’t even need to work anymore. Big difference here.

    1. Market economy is there to make sure everyone gets paid exactly what they deserve, and anyone who has marketable skills will find a job on that market. People who work for Apple are under no obligation to continue to work if they are unhappy with their rewards package. Nobody has invoked “thank you” as a part of that rewards package, so there is no sense bringing it into discussion.

      If you have a job, that means that you have skills that employers are looking for. If you don’t that means one of two things: either you don’t have the skills that are needed by employers, or you are unable to find employers who are looking for your skills and willing to pay you what you would find acceptable.

      People who “put out the hard work” should always be paid exactly what they deserve, and in most cases that is true; otherwise, such people leave and seek work elsewhere. Good successful companies attract best quality of workers because they offer best rewards packages. Mind you, these rewards packages aren’t necessarily exclusively monetary; part of the reward for working at Apple is the ability to change the world, but make no mistake, Apple pays their staff in Cupertino very well, undoubtedly. Other companies — not necessarily, and there is where the growing disparity between executive pay and workers pay becomes an obvious issue.

  10. Jobs didn’t build Apple by himself. And while others were paid equally as well, what about the poor guys in China making all these products for Apple? Shouldn’t they share in the success as well? After all, it takes a village…. you know… to get Apple’s products from the design table to your doorstep.

  11. The metrics used by boards have proven to contribute to national income imbalancing and are detrimental to our national health over the long term. What would be wrong with mandating CEO pay as some algorithm of average worker pay within that company? After all, more wealth across the board is a benefit not only to that company, but to the economy it participates in. Trickle down doesn’t work, never has worked, and was nothing more than a good but misleading sound bite. A better gauge of a company’s health is the wages it can pay. So knock off the nonsense and connect CEO pay to worker wages. Everyone would benefit, even the CEO as his worth would then become transparently apparent!

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