U.S. CEOs have it really tough. Their job is to never give workers more than a 2% raise, not make capital investments in their business, raise prices on their goods by making the products smaller or using inferior materials, outsource anything possible to the Far East, borrow at ridiculously low interest rates from Wall Street criminal banks, use the debt to buy back their company stock thereby pumping up earnings per share, and pay themselves 331 times more than their average worker. It also helps if you have an Ivy League degree, are a born psychopath, have no social empathy, and can lie with a straight face.
US CEO-Worker Pay Gap Is Widest In Developed World
Submitted by Tyler Durden on 03/26/2015 12:20 -0400
Not too long ago we solved the mystery of America’s missing wage growth by pointing to the fact that wage growth for the country’s “non-supervisory” workers was in fact headed in the wrong direction, while America’s bosses were seeing their pay increase. We went on to note that with the correlation between consumer spending and wage growth now nearly perfect, the US economy could well suffer given that non-supervisory workers account for four-fifths of total employment and consumer spending accounts for three fourths of GDP.
If you needed further evidence of the disparity in compensation for America’s bosses versus what everyone else makes, look no further than the following chart from Bloomberg which shows that the pay gap between CEOs and workers is wider in America than in any other country in the developed world — and wider by a lot.
More from Bloomberg:
The CEOs of 350 Standard & Poor’s 500 companies made 331 times more than their employees in 2013, up from a ratio of 46-to-1 in 1983, according to the AFL-CIO. That’s more than twice the gap in Switzerland and Germany, and about 10 times bigger than in Austria. In Japan, CEOs make about 67 times more than workers (although the country’s highest-paid woman earns only 25 times more). Australian CEOs get 93 times more. A global Harvard Business School survey found that most people think pay gaps are far smaller than they are. That was particularly true in the U.S., where survey respondents thought the ratio of CEO to average worker pay was 30 to 1; they put the ideal ratio at 7 to 1.
I’m sure our CEO’s are twice as smart and work twice as hard as foreign CEO’s.
Yeah, like they can afford a yacht and nice estate in the Hamptons on just 7 times more income than average worker pay. The very idea!
Henry Ford paid his people $5.00 per day, when the average wage was about $1.50 per day. This was done in order to stabilize his workforce, but was also done as Ford believed that his workers should be able to afford his products.
Henry Ford realized that paying people a decent wage would come back to reward him immensely. Of course, the wall street banksters howled in protest, stating that Ford’s high wages would “destroy capitalism” as they knew it…Henry Ford mistrusted banks and knew of their destructive potential. His writings have stated as such.
Henry Ford had a great part in establishing a “middle class” and was instrumental in helping quell the “class warfare” that was evident in other parts of the world.
Our present “race to the bottom” with the implementation of the fraudulent H-1b visa program has made native-born Americans second-class citizens in our own country. The “pointy-headed intellectuals” in our “business schools, colleges and universities have lost sight of the fact that a well-functioning economy requires a consumer base that is able to afford the consumer products available to them. It helps to have the products produced by the very consumers that eventually purchase them…in today’s business schools, the stockholder is looked upon as the one entity that must be “stroked” at all costs…the balance that is required for an economic system to flourish is ignored…a well-functioning economic system is like a three-legged stool that requires consumer/employees, investors/consumers.employees, and financial backers, also consumers.employees,investors to properly function. Take the employees out of the equation (with the siren song of cheap imports) and you have the mess that we are in today…
$12.00 starting out, most end up around $13.50 after a year.
I’m not sure what our CEO and his family make….millions?
I know the supervisor level above me brings in 200k.
Anarchyst – what a load of horseshit.
Businesses exist for one reason and one reason only – to benefit the owners. Any other benefits that accrue are a bonus.
Your tripe about workers needing to be able to buy stuff is also horseshit.
What would the cost of that $500 big screen Tv be if it was being made by one of those esteemed auto workers who now cost $100+ an hour to employ. Who would be able to afford that Tv then, even on $50k a year?
The deal is 1) the US cannot compete, and 2) they are afraid to do so. Instead folks like you want protection from those bullies that are kicking your ass.
The US citizenry has turned into a bunch of pampered, illiterate, lazy assholes who cannot compete in an open market. Time to man the fuck up and stop being pussies.
But that ain’t going to happen.
Easier to bleat for protection from those kicking sand in your face.
BTW – I am in no way supporting CEO pay levels. But fact is, the owners of the business are letting it happen. They own the business and choose to let it happen. Their companies, their choices.
I always vote against these measures, and against incumbent directors. It does not work, because the majority owners think they are getting value. It is their business and their right to do with it as they see fit.
I disagree, but I do not control it. In my business we pay modest CEO wages to me and my partner. We make money when we make money. As it should be.
And in many instances the CEOs get a minuscule percentage of the profits. Their pay is obscene, but of little consequence in the bigger picture.
Anarchyst, nice post. Ford wanted his employees to be able to buy the cars they built, the people who build iphones can’t even afford an iphone. Everyone has heard the idea that a lax immigration policy and a generous welfare state cannot coexist, for obvious reasons. Well, let me add another similar thought. Publicly traded companies can’t coexist with counterfeiting and slavery, because the counterfeiters and the slavers end up owning everything.
And llpoh, I didn’t downtick you. I am working on a little essay that will be a much better forum for you to make your case. Peace till then.
I get really sick of the whole discussion re “employees”. Being an employee has now become an aspirational goal, and he belief has become that everyone deserves a “job”.
Where is the goal of business ownership in those scenarios?
By making a job a right, business owners are instantly vilified for failing to provide those jobs that the people are rightly entitled to.
Instead, business should be allowed to move unencumbered. And jobs will flow.
The REAL reason why Henry Ford paid those high wages …. to reduce turnover.
“At the time, workers could count on about $2.25 per day, for which they worked nine-hour shifts. It was pretty good money in those days, but the toll was too much for many to bear. Ford’s turnover rate was very high. In 1913, Ford hired more than 52,000 men to keep a workforce of only 14,000. New workers required a costly break-in period, making matters worse for the company. Also, some men simply walked away from the line to quit and look for a job elsewhere. Then the line stopped and production of cars halted. The increased cost and delayed production kept Ford from selling his cars at the low price he wanted. Drastic measures were necessary if he was to keep up this production.”
http://www.forbes.com/sites/timworstall/2012/03/04/the-story-of-henry-fords-5-a-day-wages-its-not-what-you-think/
Stuck- That’s all real interesting but the games are starting.
GO CATS!!
GO XAVIER !!!!
Just wait until some prankster develops an algorithm that can replace a CEO. At those wages there certainly appears to be a need for such a program…
Llpoh, we agree more than we disagree. I’ve always been fond of reagan, because he made it easy to be a business. You went out and did what you did, with minimal interference from government. And you’re right, every possible thing that benefitted society flowed from that. Trickle down was the greatest economic theory ever (sorry stockman)
Hey stucky, fuck forbes. They, and the economist are the two worst corporo-scumbag rags out there. They revise history, write it, you read it, believe it, and another sucker ends up thinking up is down. How do you think things got so fucked up? Back to llpoh. How do I know trickle down worked? I saw it in every employee I ever had who bought a home and started a family. I saw it pull into the employee parking lot every day. When I did well, lots of people enjoyed the ride
starfcker
Agree with you re Forbes.
But, are they wrong 100% of the time. Nope. You need to distinguish between truth&lies regardless of the source.
Star – I know. Thanks.
Re the entire “right to a job” thing, it is simply a false premise.
If a right to a job exists, then there must also exist an obligation to provide a job. That obligation could only fall on either the govt or private business.
If it fell on the govt, jobs would be provided by stripping money from private business and individuals at the point of a gun. Whoops, that is happening, with very bad results.
If it fell on business, it would mean that owner’s interests are subservient to employees, and would require business to provide jobs whether or not they are profitable. Whoops again – Obamacare, high tax rates, EPA, etc., are taking business down that road rapidly – the interests of the employees are over-riding that of owners – and business is as a result doing the prudent thing – they are going broke, they are fleeing, they are refusing to hire additional employees, they are limiting wage increases, etc.
No right to a job can exist.
If the US wants more jobs created, they need to promote the interests of business, rather than slowly and certainly making businesses promote the interest of employees.
It is that simple.
A side benefit is that many more employees will be able to become, and aspire to become, business owners.
Stucky, anarchyst has his facts in line with the ford motor companies own website. Tim ‘whore’stall at forbes just made up his argument, read the comments after his article. Fortune magazine calls ford’s decision to raise wages the greatest business decision of all time. to Ford’s 1914 wage hike, his sales stalled as he ran out of affluent customers. Ford’s profits doubled between 1914-1916 due to increased sales.
Google CFO Gets $70 Million Pay Package
Ruth Porat awarded $65 million in stock grants to leave Morgan Stanley
It’s good to be Google Inc.’s chief financial officer.
I think corporate governance is broken at most publicly traded firms.
CEO sits on board, Board has compensation committee, one hand washes the other. No direct Proxy Votes allowed on compensation issues. Voila – overcompensation. It’s a deeply corrupted system.
I do believe narcissism and borderline sociopath behavior is common amongst a lot of these F500 senior management folks. Many don’t begin to earn the pay.
As to LLPOH, situation. I actually find myself in agreement. Pay competitive wages and let the stakeholders take home the cash from profits while retaining enough earnings for future growth.
I also believe that a generation ago we had much better leadership in public companies who did not overvalue or overcompensate themselves. BBES.