homepage
  roll on christmas  
click here to find out more about ship of fools click here to sign up for the ship of fools newsletter click here to support ship of fools
community the mystery worshipper gadgets for god caption competition foolishness features ship stuff
discussion boards live chat cafe avatars frequently-asked questions the ten commandments gallery private boards register for the boards
 
Ship of Fools


Post new thread  Post a reply
My profile login | Register | Directory | Search | FAQs | Board home
   - Printer-friendly view Next oldest thread   Next newest thread
» Ship of Fools   » Community discussion   » Purgatory   » Are CEOs worth it? (Page 1)

 - Email this page to a friend or enemy.  
Pages in this thread: 1  2 
 
Source: (consider it) Thread: Are CEOs worth it?
Ian Climacus

Liturgical Slattern
# 944

 - Posted      Profile for Ian Climacus     Send new private message       Edit/delete post   Reply with quote 
I think not.

Not 78 x the average way in Australia. 10 x maybe. But you're pushing it. 7? Perhaps. 5? better.

I know this isn't going to change. And I know they have million, billion, dollar companies they must steer. But I find this, frankly, a bit obscene.

Is it a case of what the market will pay? What the market will pay to ensure their CEO does not go elsewhere even?

Is it the fact they hold a lot of risk and accountability in these million-dollar plus corporations? Though as a counterpoint see one example Google threw up here.

I am ready to be convinced they are. But I have trouble seeing it.

Posts: 7578 | From: Albury, Australia | Registered: Jul 2001  |  IP: Logged
mousethief

Ship's Thieving Rodent
# 953

 - Posted      Profile for mousethief   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
And if they steer those companies onto the shoals, they take their $30M golden parachute and drop safely in another company for them to wreck.

--------------------
“Religion doesn't fuck up people, people fuck up religion.”—lilBuddha

Posts: 63202 | From: Ecotopia | Registered: Jul 2001  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
...or run for president.

--------------------
"Here is the world. Beautiful and terrible things will happen. Don't be afraid." -Frederick Buechner

Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Ian Climacus:
...
Is it a case of what the market will pay? ...

That's the way it works. One party has to be willing to pay it, and the other party willing to accept it. That makes it fair market value. Whether third parties (like you and I) think it is fair or reasonable is irrelevant.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
mousethief

Ship's Thieving Rodent
# 953

 - Posted      Profile for mousethief   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
Why is "fair market value" such a god? Why do we have to put up with that?

--------------------
“Religion doesn't fuck up people, people fuck up religion.”—lilBuddha

Posts: 63202 | From: Ecotopia | Registered: Jul 2001  |  IP: Logged
lilBuddha
Shipmate
# 14333

 - Posted      Profile for lilBuddha     Send new private message       Edit/delete post   Reply with quote 
It is market value, but it isn't fairly decided. CEO compensation is a closed loop, decided by a component of the board or directors which reports to the CEO. Often times consultants are employed and recommending a high salary to one CEO results in hiring by others.

--------------------
So goodnight moon, I want the sun
If it's not here soon, I might be done
No it won't be too soon 'til I say goodnight moon

- A. N. Parsley, D. Mcvinni

Posts: 17098 | From: the round earth's imagined corners | Registered: Dec 2008  |  IP: Logged
Rossweisse

High Church Valkyrie
# 2349

 - Posted      Profile for Rossweisse     Send new private message       Edit/delete post   Reply with quote 
It's not "fair," nor is it right. Company heads get placed on other companies' boards, and then do reciprocal pay-raising, whether the stockholders' dividends justify it or not.

One particularly egregious example may be found in the newspaper business. Newsrooms have been emptied out because of declining profits, but top management still brings home unseemly millions.

It is indeed obscene.

--------------------
I'm not dead yet.

Posts: 14752 | From: Valhalla | Registered: Feb 2002  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Ian Climacus:
...
Is it a case of what the market will pay? ...

That's the way it works. One party has to be willing to pay it, and the other party willing to accept it. That makes it fair market value. Whether third parties (like you and I) think it is fair or reasonable is irrelevant.
Isn't accepting that the naturalistic fallacy applied to economics? This is what happens, therefore it's right?

I'm not sure it looks right from heaven. I'm not one for pulling texts out of the Bible as you know, because some bugger can always pull an opposite one out, but there does seem to be a lot in there about it not being a good thing for some people to have more than they know what to do with and others having bugger all.

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
Schroedinger's cat

Ship's cool cat
# 64

 - Posted      Profile for Schroedinger's cat   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
No they are not, but when businesses are seen primarily as money generators - money which goes to the directors and shareholders - this will always be the case. That is what is wrong (Charles Handy made this point very well).

It is a core principle of economics - and a wrong one - that the purpose of a company is to make money for the shareholders. That is, I believe, enshrined in company law in the UK. But the purpose of a company should be to produce benefit, to make something that is of value.

One answer is to enforce a wage differential. So, for example, the top paid person in a company - including bonuses - should not be paid more than 50x the lowest paid (including, IMO, contracted staff like cleaners, who have to be present). This does not stop the CEO earning stupid money, but it means that everyone in the company benefits, and that is something that many of them would resist.

--------------------
Blog
Music for your enjoyment
Lord may all my hard times be healing times
take out this broken heart and renew my mind.

Posts: 18683 | From: At the bottom of a deep dark well. | Registered: May 2001  |  IP: Logged
Dafyd
Shipmate
# 5549

 - Posted      Profile for Dafyd   Email Dafyd   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Ian Climacus:
...
Is it a case of what the market will pay? ...

That's the way it works. One party has to be willing to pay it, and the other party willing to accept it. That makes it fair market value. Whether third parties (like you and I) think it is fair or reasonable is irrelevant.
Strictly speaking, we're second parties. The CEOs are the party who are willing to pay, and they are also the party who are willing to accept. It is possible that the CEOs when deciding what to pay themselves engage in hard bargaining with themselves to drive their salaries and bonuses down.

--------------------
we remain, thanks to original sin, much in love with talking about, rather than with, one another. Rowan Williams

Posts: 10419 | From: Edinburgh | Registered: Feb 2004  |  IP: Logged
Dafyd
Shipmate
# 5549

 - Posted      Profile for Dafyd   Email Dafyd   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Schroedinger's cat:

It is a core principle of economics - and a wrong one - that the purpose of a company is to make money for the shareholders.

I believe that's a recent principle, as in late seventies or early eighties. It's not a core principle. I also believe that even the person who originally proposed it is not so sure of it now.

--------------------
we remain, thanks to original sin, much in love with talking about, rather than with, one another. Rowan Williams

Posts: 10419 | From: Edinburgh | Registered: Feb 2004  |  IP: Logged
Snags
Utterly socially unrealistic
# 15351

 - Posted      Profile for Snags   Author's homepage   Email Snags   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Dafyd:
quote:
Originally posted by Schroedinger's cat:

It is a core principle of economics - and a wrong one - that the purpose of a company is to make money for the shareholders.

I believe that's a recent principle, as in late seventies or early eighties. It's not a core principle. I also believe that even the person who originally proposed it is not so sure of it now.
It's also not enshrined in law.

The purpose of a business is to do whatever it says is the purpose in the Articles of Association. So if the Articles say that money is god over all, so be it. Generally they don't.

The "you have to maximise monetary profit and not consider social good or other less tangible benefits, it's Da Law" mantra is a Big Lie generally spouted by people wishing to justify a somewhat right-wing economic position without having to actually justify it. Because you can't.

Snags
Company director & shareholder who regularly makes decisions that do not maximise profit for the company or returns for the shareholders, because Other Shit Is More Important.

Also not yet in jail for it.

--------------------
Vain witterings :-: Vain pretentions :-: The Dog's Blog(locks)

Posts: 1394 | From: just north of That London | Registered: Dec 2009  |  IP: Logged
Kwesi
Shipmate
# 10274

 - Posted      Profile for Kwesi   Email Kwesi   Send new private message       Edit/delete post   Reply with quote 
quote:
Sharkshooter: That's the way it works. One party has to be willing to pay it, and the other party willing to accept it. That makes it fair market value. Whether third parties (like you and I) think it is fair or reasonable is irrelevant.

Karl Liberal Backslider: Isn't accepting that the naturalistic fallacy applied to economics? This is what happens, therefore it's right?

Part of the problem or fraud is the assumption that “the market” is some sort of black box sent down from heaven which impartially distributes rewards, rather than a man-made construct designed to protect the interests of those who determine its rules. Executive pay seems to be determined by pay review boards composed of people in the same line of work scratching each other’s backs. How many of these executives would fare in a more open market is anyone’s guess. To my mind some CEO’s deserve every penny they get, but many don’t.
Posts: 1568 | From: South Ofankor | Registered: Sep 2005  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Kwesi:
...Part of the problem or fraud is ...

Not sure why you think there is fraud in executive compensation.

If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors. If employees are offended they can seek employment elsewhere. If customers are offended, they can boycott. Sounds like everyone has a chance to voice their opinion, and to act on it.

I can't see why government intervention makes the market more free.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Kwesi:
...Part of the problem or fraud is ...

Not sure why you think there is fraud in executive compensation.

If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors. If employees are offended they can seek employment elsewhere. If customers are offended, they can boycott. Sounds like everyone has a chance to voice their opinion, and to act on it.

I can't see why government intervention makes the market more free.

The point being made here is that a so-called "free market" is not the unequivocal greatest good we've been led to believe it is. The goal is not an absolutely free market, the goal is human flourishing. Sometimes a "more free" market aids that, sometimes it does not. In either case, a free market is at best a means to an end, not the goal in and of itself

--------------------
"Here is the world. Beautiful and terrible things will happen. Don't be afraid." -Frederick Buechner

Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Kwesi:
...Part of the problem or fraud is ...

Not sure why you think there is fraud in executive compensation.

If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors. If employees are offended they can seek employment elsewhere.

Because of course that's not at all hard to do, jobs aren't at all hard to come by, and one can always manage without one whilst one is looking.

People often say this, but in reality employees are generally stuck where they are until someone else makes them an offer.

But this is a side issue. We're not asking whether any of these groups object. We're asking whether it's OK for one fat bastard to have nearly all of the pie, while other people are starving and have no pie at all.

[ 06. December 2017, 14:05: Message edited by: Karl: Liberal Backslider ]

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
Doc Tor
Deepest Red
# 9748

 - Posted      Profile for Doc Tor     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Kwesi:
...Part of the problem or fraud is ...

Not sure why you think there is fraud in executive compensation.

If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't.

No CEO is worth $xx million.

What it is, is willy waving. "We're so successful, we're so powerful, we can afford to spunk $xx million on the top job. That's more than MegaCorp and BigBox Group because we're the best."

It's a competition, not remuneration. Once you get that, it all falls into place.

[ 06. December 2017, 14:09: Message edited by: Doc Tor ]

--------------------
Forward the New Republic

Posts: 8920 | From: Ultima Thule | Registered: Jul 2005  |  IP: Logged
L'organist
Shipmate
# 17338

 - Posted      Profile for L'organist   Author's homepage   Email L'organist   Send new private message       Edit/delete post   Reply with quote 
Its not just in business.

The Vice Chancellor of Southampton University has just been shown to have been a member of the remuneration committee which decided on his salary, boosting him to be one of the highest paid VCs in the UK. Is he worth it? Dunno, but it leaves a nasty taste in the mouth, especially after the unedifying spectacle of the VC of Bath, on over £430k a year, apparently not only being so strapped for cash she couldn't pay her own cleaner but needing a loan to buy a car.

As many people have pointed out, its not just the differences in salary, its the difference in the overall package: perhaps if every employee got generous pension provision, private health insurance, share options, etc, etc, etc, it wouldn't feel quite so inequitable but at the moment it sure looks like the rich provide for each other richly and the poor can just get lost.

--------------------
Rara temporum felicitate ubi sentire quae velis et quae sentias dicere licet

Posts: 4720 | From: somewhere in England... | Registered: Sep 2012  |  IP: Logged
mousethief

Ship's Thieving Rodent
# 953

 - Posted      Profile for mousethief   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
I can't see why government intervention makes the market more free.

This is, of course, bullshit. Without government intervention there would be no market at all. Further free markets tend toward monopoly, which is the most unfree-est market of all. Without government intervention to prevent monopoly, the market cannot possibly be free. One of the purposes of government is to prevent power from overpowering. I can't see why the market should be any different in this respect than any other part of society.

--------------------
“Religion doesn't fuck up people, people fuck up religion.”—lilBuddha

Posts: 63202 | From: Ecotopia | Registered: Jul 2001  |  IP: Logged
mousethief

Ship's Thieving Rodent
# 953

 - Posted      Profile for mousethief   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors.

The major shareholders and the Board are all members of the same elite, bilking the economy as a whole to line their Cayman Island bank accounts to no apparent end (meant in both senses of the term). When your board is made up of CEO's of other major corporations, are they going to vote to keep your salary low? Come on, you know better.

--------------------
“Religion doesn't fuck up people, people fuck up religion.”—lilBuddha

Posts: 63202 | From: Ecotopia | Registered: Jul 2001  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Doc Tor:
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Kwesi:
...Part of the problem or fraud is ...

Not sure why you think there is fraud in executive compensation.

If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't.

No CEO is worth $xx million.

Indeed. We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

One is reminded of football team managers who I gather get sacked every time the players prove unable to put the ball in the net. Only in reverse.

[ 06. December 2017, 14:27: Message edited by: Karl: Liberal Backslider ]

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
lilBuddha
Shipmate
# 14333

 - Posted      Profile for lilBuddha     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Karl: Liberal Backslider:

One is reminded of football team managers who I gather get sacked every time the players prove unable to put the ball in the net. Only in reverse.

Who gets sacked is not always the one who is the problem, but there are times when players not making goals is the coach's fault.

--------------------
So goodnight moon, I want the sun
If it's not here soon, I might be done
No it won't be too soon 'til I say goodnight moon

- A. N. Parsley, D. Mcvinni

Posts: 17098 | From: the round earth's imagined corners | Registered: Dec 2008  |  IP: Logged
no prophet's flag is set so...

Proceed to see sea
# 15560

 - Posted      Profile for no prophet's flag is set so...   Author's homepage   Email no prophet's flag is set so...   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors. If employees are offended they can seek employment elsewhere. If customers are offended, they can boycott. Sounds like everyone has a chance to voice their opinion, and to act on it.

I can't see why government intervention makes the market more free.

Because many corporations are the only show in town or one of a very few. In Canada there are, for example, 5 (if I have the count right) banks. There really isn't any competition per se. Neither for telecommunications, much of manufacturing, grocery distribution.

Prior to the neo-liberal economic ascendency in the late 1970s, we taxed very high incomes quite aggressively. I believe the highest federal/provincial level was 72% in my province. It's no where near that now.

It has been repeated so frequently over 40 years that it is considered received wisdom: that government is bad, government control is big government, that there are too many regulations and so forth. Of course it is ideology and not fact. The executive compensation issue is one of the resulting problems where there isn't sufficient government control and supervision of the economy, the tax system is set to tax improperly.

At some point in the past we lost the basic idea that a business was there to serve a public need, employers took interests in their employees' wellbeing, their families, and the companies thought about their contributions to the community. Today, most often, the CEO is parachuted in, expects to last max 5 years, and the only goal is money. This is hyper-capitalism, except that the CEO is exposed to NONE of the risks of capitalism, collecting the huge pay without any risk of their own fortune. The idea that it is market forces that govern CEO salaries just isn't true. It's a scam, and the shrinking middle class gets screwed.

What's interesting about it, is as the middle class feels the squeeze and the CEOs collect more, and the middle class complains, the ready explanation that it is immigrants causing it, or the Chinese, or other third world countries. Toads then successfully sell this idea to the public who are fed falsehoods and they vote for the Toads who successfully blame things other than the actual cause.

Posts: 11173 | From: Treaty 6 territory in the nonexistant Province of Buffalo, Canada ↄ⃝' | Registered: Mar 2010  |  IP: Logged
Kwesi
Shipmate
# 10274

 - Posted      Profile for Kwesi   Email Kwesi   Send new private message       Edit/delete post   Reply with quote 
sharkshooter
quote:
Not sure why you think there is fraud in executive compensation.
The ‘fraud’ is the notion that executive remuneration is someway ‘fair’ in terms of a supposed ‘free market’ . The determination of executive pay is by small cabals representing the corporate shareholders who dominate the larger public companies, and man (sic) the remuneration committees. What is being rewarded is more an individual’s institutional power and status rather than a demonstrated capacity to grow a business: bankers and university vice-chancellors in the vanguard. It’s not that some don’t deserve their riches, but one is not convinced that the general distribution of corporate rewards are market-determined in more than a formal sense.
Posts: 1568 | From: South Ofankor | Registered: Sep 2005  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by lilBuddha:
quote:
Originally posted by Karl: Liberal Backslider:

One is reminded of football team managers who I gather get sacked every time the players prove unable to put the ball in the net. Only in reverse.

Who gets sacked is not always the one who is the problem, but there are times when players not making goals is the coach's fault.
Coaches are not managers.

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Karl: Liberal Backslider:
We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

Substitute baseball player or basketball player for CEO.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
Schroedinger's cat

Ship's cool cat
# 64

 - Posted      Profile for Schroedinger's cat   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
It is a recent view, but recent as in 30 years old, so has heavily influenced business and the current situation - bear in mind we are only talking about comparatively recently where a CEO can take massive salaries irrepective of the performance of the company.

I accept the point about it being enshrined in law, but it is not about the purpose of the company, as the legal restriction over issuing shares. IANAL, so am talking from what I have heard.

Companies who don't have shareholders tend not to have the same astronomic CEO salaries.

--------------------
Blog
Music for your enjoyment
Lord may all my hard times be healing times
take out this broken heart and renew my mind.

Posts: 18683 | From: At the bottom of a deep dark well. | Registered: May 2001  |  IP: Logged
lilBuddha
Shipmate
# 14333

 - Posted      Profile for lilBuddha     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

Substitute baseball player or basketball player for CEO.
No. players generate money based on their performance and popularity and they all do far more in their chosen profession than you, sharkshooter, could do if you were substituted in for any of them. They are paid directly in proportion to their affect on the team's revenue. Well, more directly.

--------------------
So goodnight moon, I want the sun
If it's not here soon, I might be done
No it won't be too soon 'til I say goodnight moon

- A. N. Parsley, D. Mcvinni

Posts: 17098 | From: the round earth's imagined corners | Registered: Dec 2008  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by lilBuddha:
they all do far more in their chosen profession than you, sharkshooter, could do if you were substituted in for any of them.

Nor could I lead a large corporation.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Doc Tor:
...No CEO is worth $xx million.

...

No car is worth $3 million.

I agree with both statements. "Worth" is relative and subjective.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
lilBuddha
Shipmate
# 14333

 - Posted      Profile for lilBuddha     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by lilBuddha:
they all do far more in their chosen profession than you, sharkshooter, could do if you were substituted in for any of them.

Nor could I lead a large corporation.
Many CEOs do not do any actual leading. That isn't hyperbole or insult but a bare statement of fact.

--------------------
So goodnight moon, I want the sun
If it's not here soon, I might be done
No it won't be too soon 'til I say goodnight moon

- A. N. Parsley, D. Mcvinni

Posts: 17098 | From: the round earth's imagined corners | Registered: Dec 2008  |  IP: Logged
Crœsos
Shipmate
# 238

 - Posted      Profile for Crœsos     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by lilBuddha:
they all do far more in their chosen profession than you, sharkshooter, could do if you were substituted in for any of them.

Nor could I lead a large corporation.
I don't know about that. You seem just as capable of cratering a large corporation as Carly Fiorina (paid US$21M by Hewlett-Packard to just go away) or James Cayne. I bet you'd be able to destroy (or nearly destroy) a company for half that much (at most)!

--------------------
Humani nil a me alienum puto

Posts: 10500 | From: Sardis, Lydia | Registered: May 2001  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by no prophet's flag is set so...:
quote:
Originally posted by sharkshooter:
If the Board of Directors feels the CEO is worth $xx million, they will pay it, otherwise, they won't. If the shareholders disagree, they can replace the board of Directors. If employees are offended they can seek employment elsewhere. If customers are offended, they can boycott. Sounds like everyone has a chance to voice their opinion, and to act on it.

I can't see why government intervention makes the market more free.

Because many corporations are the only show in town or one of a very few. In Canada there are, for example, 5 (if I have the count right) banks. There really isn't any competition per se. Neither for telecommunications, much of manufacturing, grocery distribution.

Prior to the neo-liberal economic ascendency in the late 1970s, we taxed very high incomes quite aggressively. I believe the highest federal/provincial level was 72% in my province. It's no where near that now.

It has been repeated so frequently over 40 years that it is considered received wisdom: that government is bad, government control is big government, that there are too many regulations and so forth. Of course it is ideology and not fact. The executive compensation issue is one of the resulting problems where there isn't sufficient government control and supervision of the economy, the tax system is set to tax improperly.

At some point in the past we lost the basic idea that a business was there to serve a public need, employers took interests in their employees' wellbeing, their families, and the companies thought about their contributions to the community. Today, most often, the CEO is parachuted in, expects to last max 5 years, and the only goal is money. This is hyper-capitalism, except that the CEO is exposed to NONE of the risks of capitalism, collecting the huge pay without any risk of their own fortune. The idea that it is market forces that govern CEO salaries just isn't true. It's a scam, and the shrinking middle class gets screwed.

What's interesting about it, is as the middle class feels the squeeze and the CEOs collect more, and the middle class complains, the ready explanation that it is immigrants causing it, or the Chinese, or other third world countries. Toads then successfully sell this idea to the public who are fed falsehoods and they vote for the Toads who successfully blame things other than the actual cause.

A very hellish ditto to all of the above, and mousethief's comments as well.
[Mad]

--------------------
"Here is the world. Beautiful and terrible things will happen. Don't be afraid." -Frederick Buechner

Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by lilBuddha:
quote:
Originally posted by sharkshooter:
quote:
Originally posted by lilBuddha:
they all do far more in their chosen profession than you, sharkshooter, could do if you were substituted in for any of them.

Nor could I lead a large corporation.
Many CEOs do not do any actual leading. That isn't hyperbole or insult but a bare statement of fact.
Yes. While it's nice of sharpshooter to sound so humble, I'm less and less convinced that is a fact. I'm more and more wondering if we'd have at least a 50/50 chance of a better outcome (depending on how you measure "better outcome") if we just grab some random minimum-wage earner off the factory floor who knows a lot more about widgets you're manufacturing than the guy parachuted in who last week was CEO of a sprocket company.

--------------------
"Here is the world. Beautiful and terrible things will happen. Don't be afraid." -Frederick Buechner

Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

Substitute baseball player or basketball player for CEO.
No. CEOs are analogous with the managers.

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
Dafyd
Shipmate
# 5549

 - Posted      Profile for Dafyd   Email Dafyd   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by no prophet's flag is set so...:
Today, most often, the CEO is parachuted in, expects to last max 5 years, and the only goal is money.

That's the other problem: the market for share buyers is at the moment heavily slanted towards hedge funds and financial institutions with lots of liquid capital seeking short-term profits. That means that a company are being run to boost their share price by selling off assets and cutting its workforce to levels that are unsustainable in the long term. It's more difficult for a company to raise money for long-term investments.
A CEO who pays themselves in shares isn't necessarily tied to the fortunes of the company, since the expectation is that shares will be easily sold on.

--------------------
we remain, thanks to original sin, much in love with talking about, rather than with, one another. Rowan Williams

Posts: 10419 | From: Edinburgh | Registered: Feb 2004  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by Karl: Liberal Backslider:
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

Substitute baseball player or basketball player for CEO.
No. CEOs are analogous with the managers.
Not pay-wise.

Do I take it you are ok with some employees (baseball players) making $33 million a year, but not other employees (CEOs)?

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
No one is suggesting all employees be paid the same regardless of responsibility or ability or effort. The general thrust of the thread seems to be that there ought to be some reasonable mathematical relationship (20x, 50x, something other than the current 500x) between the highest paid employee-- whether that be the "talent" (e.g. well-paid athletes and actors) or the CEO-- and the lowest paid. There is no upper limit on compensation for those upper wage earners, but forcing them to consider that mathematical relationship and calculate the cost of bringing up 1000s of employees to a wage that allows their desired raise helps guard against a sort of feudal arrangement with a very small number of land(business) owners profiting off the backs of a large number of economically oppressed people trapped in poverty. This is very very nearly the situation now in the US, with no hope of turning that around without some sort of govt intervention.

--------------------
"Here is the world. Beautiful and terrible things will happen. Don't be afraid." -Frederick Buechner

Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
So a baseball team that pays minimum wage to certain employees in, say, the mail room of the head office, is restricted on what they can play their superstars? If minimum wage is $20,000/year, the player salary would be capped at, for example, $1,000,000?

Is that what you are proposing?

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
lilBuddha
Shipmate
# 14333

 - Posted      Profile for lilBuddha     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
No. CEOs are analogous with the managers.

Not pay-wise.

Do I take it you are ok with some employees (baseball players) making $33 million a year, but not other employees (CEOs)?

A CEO would be more analogous to the owner of a team than the manager, but analogies are not always perfect.
How about sticking to trying to prove that CEO's are worth their pay?

[ 07. December 2017, 16:21: Message edited by: lilBuddha ]

--------------------
So goodnight moon, I want the sun
If it's not here soon, I might be done
No it won't be too soon 'til I say goodnight moon

- A. N. Parsley, D. Mcvinni

Posts: 17098 | From: the round earth's imagined corners | Registered: Dec 2008  |  IP: Logged
Kwesi
Shipmate
# 10274

 - Posted      Profile for Kwesi   Email Kwesi   Send new private message       Edit/delete post   Reply with quote 
cliffdweller
quote:
The general thrust of the thread seems to be that there ought to be some reasonable mathematical relationship (20x, 50x, something other than the current 500x) between the highest paid employee-- whether that be the "talent" (e.g. well-paid athletes and actors) or the CEO-- and the lowest paid.
I don't think well-paid sportsmen should be treated the same way as CEOs because their remuneration is closely allied to their market value: the amount the fans are prepared to pay to watch them, their value to the club in getting them trophies and into prestigious competitions (more gate money and better TV rights), and the number of shirts and other items their names shift. If their income is artificially restricted then the benefit is to the shareholders of the club, and there may be a drop in performances with the removal of incentives. Once their talents and value recede market forces quickly ensure that is reflected in their pay and terms of future contracts. Similar criteria apply to actors and entertainers. CEO pay is not linked to performance in anything like the same way, as I've suggested before.
Posts: 1568 | From: South Ofankor | Registered: Sep 2005  |  IP: Logged
Crœsos
Shipmate
# 238

 - Posted      Profile for Crœsos     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by cliffdweller:
There is no upper limit on compensation for those upper wage earners, but forcing them to consider that mathematical relationship and calculate the cost of bringing up 1000s of employees to a wage that allows their desired raise helps guard against a sort of feudal arrangement with a very small number of land(business) owners profiting off the backs of a large number of economically oppressed people trapped in poverty.

quote:
Originally posted by sharkshooter:
So a baseball team that pays minimum wage to certain employees in, say, the mail room of the head office, is restricted on what they can play their superstars? If minimum wage is $20,000/year, the player salary would be capped at, for example, $1,000,000?

Is that what you are proposing?

That actually seems to be the opposite of what cliffdweller is actually proposing. I also question why an organization that pays multi-million dollar salaries to others is paying a poverty-level wage to an important member of its communications staff. Seems like a free rider problem, sloughing off some of an employee's upkeep onto the social safety net. (For reference, a married couple in the U.S. living on $20,000/year is qualified for Medicaid.)

[ 07. December 2017, 16:27: Message edited by: Crœsos ]

--------------------
Humani nil a me alienum puto

Posts: 10500 | From: Sardis, Lydia | Registered: May 2001  |  IP: Logged
sharkshooter

Not your average shark
# 1589

 - Posted      Profile for sharkshooter     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by lilBuddha:

How about sticking to trying to prove that CEO's are worth their pay?

Because I think the proposition is too restrictive.

I have no inclination to prove anyone is worth that kind of money: CEO, baseball player, or Roger Goodell.

--------------------
Let the words of my mouth, and the meditation of my heart, be acceptable in thy sight, O LORD, my strength, and my redeemer. [Psalm 19:14]

Posts: 7751 | From: Canada; Washington DC; Phoenix; it's complicated | Registered: Oct 2001  |  IP: Logged
Crœsos
Shipmate
# 238

 - Posted      Profile for Crœsos     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by lilBuddha:
How about sticking to trying to prove that CEO's are worth their pay?

Because I think the proposition is too restrictive.

I have no inclination to prove anyone is worth that kind of money: CEO, baseball player, or Roger Goodell.

[Confused] The thread title is literally "Are CEOs worth it?" If you don't want to discuss that, why are you here?

--------------------
Humani nil a me alienum puto

Posts: 10500 | From: Sardis, Lydia | Registered: May 2001  |  IP: Logged
hatless

Shipmate
# 3365

 - Posted      Profile for hatless   Author's homepage     Send new private message       Edit/delete post   Reply with quote 
Sports stars do at least seem to be a meritocracy. Footballers in the UK are not usually from privileged backgrounds. They may be overpaid, but there is more sense that they’re worth it than with CEOs. I couldn’t do Harry Kane’s job, but I could do a CEO’s job, at least long enough to never need to work again.

No one yet has mentioned that money is power. Rich people have more influence in politics, greater access to law, healthcare, education, etc. Their children and any others they support can jump queues to get jobs, places at university, opportunities at those sports, unlike football, which are strongly skewed to the rich.

An author may sell millions of books, and you could say they have earned it and are worth it, but still, it is wrong for one person to count for so much more than others.

[ 07. December 2017, 17:11: Message edited by: hatless ]

--------------------
My crazy theology in novel form

Posts: 4507 | From: Stinkers | Registered: Sep 2002  |  IP: Logged
Crœsos
Shipmate
# 238

 - Posted      Profile for Crœsos     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by hatless:
Sports stars do at least seem to be a meritocracy.

Not always. Sometimes players are blackballed for political (or other non-merit-based) reasons.

--------------------
Humani nil a me alienum puto

Posts: 10500 | From: Sardis, Lydia | Registered: May 2001  |  IP: Logged
cliffdweller
Shipmate
# 13338

 - Posted      Profile for cliffdweller     Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
So a baseball team that pays minimum wage to certain employees in, say, the mail room of the head office, is restricted on what they can play their superstars? If minimum wage is $20,000/year, the player salary would be capped at, for example, $1,000,000?

Is that what you are proposing?

Some variation on that, yes. 100s of successful companies (most notably, Costco) work this way. It's the sort of thing that works best when mandated across the board so you're not at a disadvantage with your competitors
Posts: 11131 | From: a small canyon overlooking the city | Registered: Jan 2008  |  IP: Logged
Karl: Liberal Backslider
Shipmate
# 76

 - Posted      Profile for Karl: Liberal Backslider   Author's homepage   Email Karl: Liberal Backslider   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
quote:
Originally posted by sharkshooter:
quote:
Originally posted by Karl: Liberal Backslider:
We have, as a society, bought into the idea that these people have a rare talent which needs to be competed for by higher and higher renumeration offers until someone is blessed by having this great and sainted CEO by offering more than anyone else.

Who then does what, exactly, that virtually no-one else can do?

Substitute baseball player or basketball player for CEO.
No. CEOs are analogous with the managers.
Not pay-wise.

Do I take it you are ok with some employees (baseball players) making $33 million a year, but not other employees (CEOs)?

No, and I think you've spectacularly missed my point.

--------------------
Might as well ask the bloody cat.

Posts: 17717 | From: Chesterfield | Registered: May 2001  |  IP: Logged
Dafyd
Shipmate
# 5549

 - Posted      Profile for Dafyd   Email Dafyd   Send new private message       Edit/delete post   Reply with quote 
quote:
Originally posted by sharkshooter:
So a baseball team that pays minimum wage to certain employees in, say, the mail room of the head office, is restricted on what they can play their superstars? If minimum wage is $20,000/year, the player salary would be capped at, for example, $1,000,000?

The team isn't forced to pay minimum wages to its employees. If it can find enough down the back of the sofa to pay its star player $2,000,000 it can probably find another $1,000,000 to pay its fifty minimum wage employees another $20,000 each.

That is especially true if all the other teams in the competition have to do the same.

--------------------
we remain, thanks to original sin, much in love with talking about, rather than with, one another. Rowan Williams

Posts: 10419 | From: Edinburgh | Registered: Feb 2004  |  IP: Logged
Jay-Emm
Shipmate
# 11411

 - Posted      Profile for Jay-Emm     Send new private message       Edit/delete post   Reply with quote 
Entrepreneurs and Author's of various media, in certain respects are responsible for what they've done and have often taken a real risk. On the other hand it's not done in a vacuum. Bill Gate's didn't create the software he sold, he did well in selling it to IBM, but didn't create them and their strength. He didn't pay for the school IT staff who taught Office, but he did a lot to make it that way. Technically uncapped but logrithmically harder sounds superficially right (if impossible to arrange in practice).

Sports Stars (and possibly other Stars) are arguably the best, but the market is rigged so that being the best is much better than being 2nd.
Ronaldo might be better than 2 of me, but not 5,000 but that isn't allowed to be an option.
If they want that protection, then they can take some limits in exchange.

CEO's on the other hand. There's little evidence they provide a greater contribution than any other employee. Most of them didn't create the institution they run (or in modern cases even work for it). Few of them have taken serious risks. It's just that they are more or less in charge of they're own pay from the shared pot and their successors recruitment.

Posts: 1619 | Registered: May 2006  |  IP: Logged



Pages in this thread: 1  2 
 
Post new thread  Post a reply Close thread   Feature thread   Move thread   Delete thread Next oldest thread   Next newest thread
 - Printer-friendly view
Go to:

Contact us | Ship of Fools | Privacy statement

© Ship of Fools 2016

Powered by Infopop Corporation
UBB.classicTM 6.5.0

 
Check out Reform magazine
sip of fools mugs from your favourite nautical website
 
  ship of fools