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"Well paid CEO" and "CEO making hundreds of times more than their employees, and increasing their compensation at a time when workers are being laid off, seeing

"Well paid CEO" and "CEO making hundreds of times more than their employees, and increasing their compensation at a time when workers are being laid off, seeing pay freezes and drops, and just straight-up dying of COVID" are....not, shall we say, quite equivalent.

29athrowaway 6y ago
Another interpretation is that they managed to keep their companies afloat despite all the adversities affecting their sectors. It could have been much worse.
- Daishiman 6y ago
  And the evidence for that is?
- danaris 6y ago
  And I am not (at least, not here) attempting to argue that a) they do not do a worthwhile job, or b) they should not be well-paid. Merely that the relationship between their pay and the pay of their employees should not be so drastically out of balance.
- aaron-santos 6y ago
  The thing is, this applies to all of the non-CEO staff as well. Without them, the company would not stay afloat. If anything, they risked their capital (ie the labor-producing bodies) more than any CEO. And all of this in an economic system where capital risk is ostensibly rewarded.
  - 29athrowaway 6y ago
    CEOs make important decisions... acquisions, mergers, layoffs, expanding, shrinking, key partnerships, etc... or entirely changing the direction of the company.
    - aaron-santos 6y ago
      Laborers do important work. Without them the company produces nothing. We could go back and forth with this. And for one reason: it doesn't matter what the CEO does or doesn't do. There is something else that matters much more than any of that.
      - 29athrowaway 6y ago
        What happens if a laborer shows up to work drunk, and sexually harasses a colleague and then starts a fight? What will happen is that they will get fired with no news coverage and no impact to the share price whatsoever. What happens if a CEO does a fraction of that? It will affect the share price. Share holders will be pissed off. People will protest about it, people will stop buying the products, there will be news coverage and social media coverage about it... It will be a mess that will affect not only the CEO but everyone under them either directly or indirectly. Once the CEO is replaced, the new CEO will bring a new team and that will trigger a reorg... All the stuff above comes with risks and it's possible the new CEO is unsuccessful and has to be replaced again. And the losses generated by the outing of the crazy CEO will likely affect the laborers too somehow. As you can see, even if the laborer works hard and contributes to the company, but they do not have the same responsibility as the CEO.
        aaron-santos 6y ago
        Let's zoom in on what happens when a CEO is replaced. They get a severance package that is more than what I (making 6-figures even) will make in a lifetime. That's what I mean when I'm taking about risks. If I do any of those things, then I'm risking food, housing, and taking care of my kids. If a CEO does it, then he is risking early retirement. That is what makes all the difference.
        29athrowaway 6y ago
        Sometimes the CEO can do so much harm to a company, that there's no going back. The entire company becomes a failure, and not only the CEO gets a severance package... every employee gets laid off too. And the shareholders lose their money, and the investors lose their investment... The livelihood of thousands of people can be in the hands of a CEO. If you have something against hierarchies, that's your problem, man. Hierarchies exist everywhere and have always existed. Larger groups beat smaller groups, and groups need coordination and leadership.
LatteLazy 6y ago
If you're a ceo and have 10k employees, and you get them to accept 1k a year less each in wages, you made the shareholders 10m. So it makes sense you get 1m extra. (1k a year for a full time employee is 50c/h roughly, less if you factor in pay linked benefits and other costs). Hilton has 173k employees. So a ceo who can get minimal amounts more out of them or cut the cost of them even slightly is worth a fortune. I think this is the real driving force behind the ceo pay numbers we've seen: more big companies where a single ceo or a small top-team have huge leverage. I'm not making a moral arguement. Just a practical/Economic one. I think "leverage" is a better concept here than "responsibility" (which carries moral implications...)
- danaris 6y ago
  I'm definitely making a moral argument, because I am a moral person, but for those for whom such arguments hold no sway, I am also making also a practical, economic one: We have ample evidence, from the way things have gone over the past few decades, that increasing inequality in an economic system is bad for the system as a whole.
  - loceng 6y ago
    Indeed, you need to properly fund/fuel/lubricate the largest segment/cog in the capitalist system - the consumer; UBI tied to inflation.
  - LatteLazy 6y ago
    I agree, but that's not something any one ceo can control. All he can do is maximise his own pay.
    - aaron-santos 6y ago
      Yep, and probably preaching to the choir here. That's usually why these conversations tend toward criticizing the systems that encourage these incentives.
- alephu5 6y ago
  The important questions remains: Why is it possible to reduce salaries without losing your workforce? If it's because the economy is shrinking and job supply is dropping, CEO salaries should be less competitive too and share prices should be dropping but we see the contrary. There's something more than basic market dynamics at play here, inequality is being systematically nurtured which I think is the premise of the article.

29athrowaway 6y ago

Another interpretation is that they managed to keep their companies afloat despite all the adversities affecting their sectors. It could have been much worse.

Daishiman 6y ago
And the evidence for that is?
danaris 6y ago
And I am not (at least, not here) attempting to argue that a) they do not do a worthwhile job, or b) they should not be well-paid. Merely that the relationship between their pay and the pay of their employees should not be so drastically out of balance.
aaron-santos 6y ago
The thing is, this applies to all of the non-CEO staff as well. Without them, the company would not stay afloat. If anything, they risked their capital (ie the labor-producing bodies) more than any CEO. And all of this in an economic system where capital risk is ostensibly rewarded.
- 29athrowaway 6y ago
  CEOs make important decisions... acquisions, mergers, layoffs, expanding, shrinking, key partnerships, etc... or entirely changing the direction of the company.
  - aaron-santos 6y ago
    Laborers do important work. Without them the company produces nothing. We could go back and forth with this. And for one reason: it doesn't matter what the CEO does or doesn't do. There is something else that matters much more than any of that.
    - 29athrowaway 6y ago
      What happens if a laborer shows up to work drunk, and sexually harasses a colleague and then starts a fight? What will happen is that they will get fired with no news coverage and no impact to the share price whatsoever. What happens if a CEO does a fraction of that? It will affect the share price. Share holders will be pissed off. People will protest about it, people will stop buying the products, there will be news coverage and social media coverage about it... It will be a mess that will affect not only the CEO but everyone under them either directly or indirectly. Once the CEO is replaced, the new CEO will bring a new team and that will trigger a reorg... All the stuff above comes with risks and it's possible the new CEO is unsuccessful and has to be replaced again. And the losses generated by the outing of the crazy CEO will likely affect the laborers too somehow. As you can see, even if the laborer works hard and contributes to the company, but they do not have the same responsibility as the CEO.
      - aaron-santos 6y ago
        Let's zoom in on what happens when a CEO is replaced. They get a severance package that is more than what I (making 6-figures even) will make in a lifetime. That's what I mean when I'm taking about risks. If I do any of those things, then I'm risking food, housing, and taking care of my kids. If a CEO does it, then he is risking early retirement. That is what makes all the difference.
        29athrowaway 6y ago
        Sometimes the CEO can do so much harm to a company, that there's no going back. The entire company becomes a failure, and not only the CEO gets a severance package... every employee gets laid off too. And the shareholders lose their money, and the investors lose their investment... The livelihood of thousands of people can be in the hands of a CEO. If you have something against hierarchies, that's your problem, man. Hierarchies exist everywhere and have always existed. Larger groups beat smaller groups, and groups need coordination and leadership.

LatteLazy 6y ago

If you're a ceo and have 10k employees, and you get them to accept 1k a year less each in wages, you made the shareholders 10m. So it makes sense you get 1m extra. (1k a year for a full time employee is 50c/h roughly, less if you factor in pay linked benefits and other costs). Hilton has 173k employees. So a ceo who can get minimal amounts more out of them or cut the cost of them even slightly is worth a fortune. I think this is the real driving force behind the ceo pay numbers we've seen: more big companies where a single ceo or a small top-team have huge leverage. I'm not making a moral arguement. Just a practical/Economic one. I think "leverage" is a better concept here than "responsibility" (which carries moral implications...)

danaris 6y ago
I'm definitely making a moral argument, because I am a moral person, but for those for whom such arguments hold no sway, I am also making also a practical, economic one: We have ample evidence, from the way things have gone over the past few decades, that increasing inequality in an economic system is bad for the system as a whole.
- loceng 6y ago
  Indeed, you need to properly fund/fuel/lubricate the largest segment/cog in the capitalist system - the consumer; UBI tied to inflation.
- LatteLazy 6y ago
  I agree, but that's not something any one ceo can control. All he can do is maximise his own pay.
  - aaron-santos 6y ago
    Yep, and probably preaching to the choir here. That's usually why these conversations tend toward criticizing the systems that encourage these incentives.
alephu5 6y ago
The important questions remains: Why is it possible to reduce salaries without losing your workforce? If it's because the economy is shrinking and job supply is dropping, CEO salaries should be less competitive too and share prices should be dropping but we see the contrary. There's something more than basic market dynamics at play here, inequality is being systematically nurtured which I think is the premise of the article.