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So according to this 2018 article by The Verge [1], Foxconn workers producing iGadgets in China earn on average $390.16 per month. Times that by twelve and we

So according to this 2018 article by The Verge [1], Foxconn workers producing iGadgets in China earn on average $390.16 per month. Times that by twelve and we find that workers earn $4,681.92 per year on average. If we divide Tim's $750,000,000 bonus/payout this year by that $4,681.92 yearly Foxconn salary, we get 160,190 My question is: how is Tim so productive that he does roughly 160,000 people’s work, or 1/8th of Foxconn’s total workforce? [2] /s The contrast between working conditions is also interesting: “The [Foxconn] factory has no medical facilities or hospital on site, so any injured workers have to be transported to a hospital that’s farther away. Another work hazard is the lack of fire safety: there are no exits or labeled escape routes and no fire safety drills. Similar to other factories that China Labor Watch has reported on, there’s no labor union for the Hengyang workers. There’s a process for filing complaints, but the workers don’t believe it does any good.” Which seems quite a contrast to ‘Apple Park’ where Tim works. What makes Apple treat Chinese workers so differently? [1] https://www.theverge.com/2018/6/11/17448544/amazon-foxconn-worker-conditions-benefits-stripped-low-wages-chinese-factory https://www.theverge.com/2018/6/11/17448544/amazon-foxconn-w... [2] https://www.google.com/search?q=how+many+foxconn+employees https://www.google.com/search?q=how+many+foxconn+employees

SMAAART 5y ago
Recipe to have a nonsensical argument: 1. Take a Normal distribution 2. Take 2 pieces of data that are 3 standard deviation from mean, in opposite directions 3. Compare and contrast 4. Keep a straight face while making the argument, use plenty of Logical fallacies to defend your position against logic and reasoning. 5. Alternate between attacking and being the victim. 6. Lather, rinse, repeat
- ZephyrBlu 5y ago
  Emotional arguments are more effective than logical ones, even if you are talking to smart people.
  - SMAAART 5y ago
    And that is the most logical statement. Thank you for the reminder.
viztor 5y ago
That's the definition of capitalism.
zpeti 5y ago
As a comment already says, this was due to meeting targets agreed 10 years ago. Now a lot of that is due to share prices, and my opinion is share prices are not set by the market any more, are massively inflated to make the US government look good, but that doesn't have much to do with Cook, much like Tesla's share price doesn't have much to do with Elon Musk (I'm serious, the guy is good at marketing, but that only takes you so far). There's been low interest rates for almost 2 decades now. One of the primary effects of that is inflated share prices. So, to say the least, this is a complex situation. Comparing Cook's renumeration to a chinese worker is just silly.
- axelroze 5y ago
  Speaking of Tesla's share price. It has Price/Earnings (PE) ratio of 1095 while a normal ratio is around 5 to 10, perhaps around 20 for tech companies. Apple's PE is 29. Share prices have definitely lost all sense in March 2020. One should keep that in mind when analysing the current economy.
spottybanana 5y ago
> My question is: how is Tim so productive that he does roughly 160,000 people’s work, or 1/8th of Foxconn’s total workforce? [2] /s Nobody has been making these productivity claims to begin with, but leftists commonly use productivity vs salary to ridicule CEO compensation. CEOs are paid for numerous reasons, for example board wants to trust the person with billions worth of assets which makes it sensible to pay certain amount just to guarantee greed doesnt take over, for example. Productivity is one factor but I doubt it is always the most important thing.
- mellavora 5y ago
  Wait-- so paying large amounts stops greed from taking over? I wonder how that is working for them. though you have a valid point, CEO pay isn't about CEO productivity, it is about corporate productivity.
- akie 5y ago
  You are justifying someone being paid $750m. No one needs that much money. No one. Why are you defending this? It's obscene. Really reminds me of this https://i.kym-cdn.com/photos/images/original/002/147/150/e2c.png https://i.kym-cdn.com/photos/images/original/002/147/150/e2c...
  - Grustaf 5y ago
    Of course no one needs it. But the discussion here was if he had earned it, and he definitely has. Relative to value creation, I bet he’s very low in the CEO compensation league.
    - inetknght 5y ago
      > But the discussion here was if he had earned it, and he definitely has. I disagree. > Relative to value creation, I bet he’s very low in the CEO compensation league. You really think Tim Cook has created the value of the company? I very seriously doubt it. At the risk of whataboutisms: what about the engineers who did the work? What about the factory workers who did the work? What about the contractors who did the work? Tim Cook didn't create the value. He created a contract. That's all.
rglullis 5y ago
When will we learn to stop making these silly calculations about "productivity" and understand that people are paid not by the value of their work, but by their scarcity? Any factory in China can replace most of their 160k employees overnight if they wanted to. How many Tim Cook's do you have lying around?
- lostinquebec 5y ago
  .. and how many Ballmers!
- Aeolun 5y ago
  > by their scarcity By their perceived scarcity Chances are that anyone other than Tim could have done just as well. Still, this is over 10 years, and Apple shares have increased in value by 1900%. If they were still the same value he’d have gotten 40M, for about 4M per year. Which is much more reasonable. I still think it’s high, but in line with what others get.
  - UncleMeat 5y ago
    Because it should be about productivity. People are highlighting a moral failing of society.
    - ChrisLomont 5y ago
      Is that moral failing related to jealously about how others choose to spend money that isn't theirs?
      - UncleMeat 5y ago
        Money is not gifted to people by God. It is allocated to people by systems that society chooses. The idea of the specific "rightful" ownership of money we have today is not universal throughout history and can change.
        5y ago
Grustaf 5y ago
Put it this way. In the last 5 years Tim Cook has created $1900 b in shareholder value. If you divide that by 160000 you get $12 m. Now I don’t know how many phones a foxconn worker can make per year, but I do think it’s fair to assume they do not each create much more than $2 m in value annually. Or another way to see it. While creating 2 trillion dollars of value for shareholders, he has been paid about 1.5 b. As a shareholder I think that’s very fair compensation. So relative to value creation, nobody can claim that he’s overpaid. A deeper questions is if it’s reasonable for anyone to own a billion dollars. I don’t think so, but Tim Cook has deserved the money more than most.
- DasIch 5y ago
  > In the last 5 years Tim Cook has created $1900 b in shareholder value. That's just obviously not the case unless Tim is the only person working at Apple. All employees contributed that and it's perfectly reasonable to discuss how these rewards should be distributed, even if they should be distributed to shareholders at all.
  - Grustaf 5y ago
    No matter how you look at it, a CEO that earns less than 0.1% of the shareholder value created under his watch can’t reasonably be called overpaid.
    - breakfastduck 5y ago
      People seem to be really keen to forget that the CEO is an employee too. Should the shareholders profit exclusively when in effect the CEO is their representative? The argument isn't that he should be paid less, the real argument is that the general day to day employees should be paid more. The money doesn't come out of the CEOs pocket in a publicly traded org.
    - SamoyedFurFluff 5y ago
      “No matter how you look at it”? I question this because I personally am fairly persuaded that, if the CEO is not the only employee at the company, but the CEO is stated to earn “shareholder value under his watch” and then a portion being 0.1%, but another employee, say a manager or a director who also likely “created shareholder value” but earned 0.0000000001% or some other ridiculous fraction I would indeed question what makes the CEO different from the other employees such that they deserve so much more than the other employees that contributed to the shareholder value generation.
throwthere 5y ago
For starters divide everything by 10 because this was for the last ten years (first line in the article). I think your suggestion that pay should be closely tied to productivity is kind of correct, but it’s missing a “value” component— and Cook provided a lot of value to a lot of people, 100s of billions. Pro rata he’s just getting a small commission. It’s not like you can hire 1600 workers and replace Cook with them.
siva7 5y ago
i would expect such reasoning on tabloids but on hn?
- leesalminen 5y ago
  HN has been lurching left very quickly over the past years. Dunno if you’ve noticed.
  - OJFord 5y ago
    True or not, that's not related to the accusation of 'tabloid reasoning'. See political leanings of UK tabloids for example: https://en.wikipedia.org/wiki/List_of_newspapers_in_the_United_Kingdom#Tabloid_newspapers https://en.wikipedia.org/wiki/List_of_newspapers_in_the_Unit...
nvilcins 5y ago
Adding two _trillion_ dollars of net worth sounds pretty productive to me.
- robin_reala 5y ago
  Out of interest, how much of that two trillion dollars do you think is directly attributable to the role of CEO?
  - nvilcins 5y ago
    No less than 5%, or 100 billion.
Kiro 5y ago
Sorry, but your question is something I would expect a kid to ask the first time they become aware of inequality. Compassionate but extremely basic. The problem obviously can't be distilled to such a simple and shallow question.
- cartbeforehorse 5y ago
  imagine how many potential Tim Cooks are among those workers who can't ever become Tim Cooks due to their circumstances
willcipriano 5y ago
What I find interesting is none of the outlets who are currntly proclaiming that there is a worker shortage ever mention the executive shortage. The executive shortage has massive impacts on firms, imagine how much value could be generated for the shareholders by the 750 million that was just blown on compensation? We should create tax incentives for firms to offshore their executives, as well as immigration programs that shackle executives in a job with fears of deportation for them and their families should they dare ask to be compensated like their domestic peers in order to improve the fitness and agility of the US economy.
deleted 5y ago
[deleted]
option 5y ago
it is not about being 160K more productive. It is about supply and demand (of talent). Try finding even 5 Tim Cooks, not 160K. He is hired by Apple’s shareholders, what would happen to share price if he leaves?
varnaud 5y ago
Tim Cook can pay the Chinese workers rounding errors on his net worth because they and the other workers able to do similar work are not organized. They have no power. They can't ask for better working condition and better salary. Also, he really cares about making money, so since the workers have no power, why give them anything else than the minimum and get yourself the maximum? Who cares about some random oversea workers? Their problem, not mine. /s
tailspin2019 5y ago
Most of the comments are focusing on your salary comparisons, and while I do think it's not quite as simple as what you've laid out (we know how capitalism and its reward structures work), the wider and much more important point I take from your comment is about how workers in these overseas factories are treated generally, not necessarily just about what they're paid. There clearly IS a problem here. It's not just Apple and it's not just corporations, we all (in the West) have to take a bit of responsibility around this. So for everyone disagreeing with you, I do think you raise/{remind us of} some important ethical issues that do need ongoing and open discussion.
xornox 5y ago
For some reason owners of Apple value Tim Cook worth of billions. I am sure that if you can replace Tim Cook and work for 390$ per month, owners will happily fire Tim Cook.
MikeLumos 5y ago
How many of those 160,000 people would be able to successfully run Apple? Would all 160,000 of them put together be able to do a better job than Tim did?
ericmay 5y ago
Ok now do this same exercise with your own salary. In fact, anyone here can. Are you as a software engineer making $200,000+ delivering as much value as ~42 of these Chinese laborers at Foxconn? I doubt it. And people pointing to Tim Cook about how it’s all unfair and everything. Dang I mean the cognitive dissonance and ego to think that you making 42x a worker is ok because the JIRA tickets you addressed add a lot to the bottom line but Tim Cook just makes too much? Personally I don’t really care. Just find it interesting to see how people justify themselves.
- ultimatedogewow 5y ago
  tbh I don‘t. Even compared to people in my country I feel like I‘m not creating much more value than those paid a minimum wage. I rather feel both lucky working in an industry where (too) much money changes hands and a bit guilty, too
jfroma 5y ago
Maybe a little off topic, but in my country you will have a very good life with $390 per month and yet we have near 35% of our population living on poverty. The minimum wage is a little lower than that and there are a lot of laws favoring employees which makes it really hard for companies to hire. Just to give you an example, last year the president signed a decree to forbid companies firing people with the excuse of covid, nothing but a populist measure. The result is that no company will ever hire here, which creates more unemployment. I mention this because giving a lot of rights to employees by law sounds good but I have seen and lived the consequences my entire life. Should apple on their own pay more to chineese people? I think another comment address that, at the end is an scarcity problem, supply and demand.
dudul 5y ago
Compensation is a function of how difficult it is to find/replace a worker, not their productivity.
scyzoryk_xyz 5y ago
Chinese workers don't work for Apple. Apple, like any giant manufacturing conglomerate, relies on a complex supply chain of manufacturers who supply them with all the necessary parts and components. These manufacturers are also purchasing from even higher in the supply chain. As a company, Apple buys parts from suppliers, period. None of their business how these suppliers squeeze to deliver these parts at the best prices and quality. Before Apple arrived at the current position (2000-2010) they were a small player and it wasn't possible to squeeze parts suppliers. Tim Cook gets an enormous payout because he navigated the company towards flipping this relationship, because he is an expert in squeezing the best quality/price for the parts. Getting the iPhone below $1000 is what gets him his $750mil
cascom 5y ago
Because those workers are not in a position to effect meaningful marginal value creation. Let’s say you paid that $750m in bonuses to those factory workers, what value was created for shareholders? Zero, because Apple doesn’t have a capacity problem producing iPhones… Who knows how much value Tim Cook created vs some other CEO (he may have destroyed value), we’ll never know, but I think the philosophy is to align incentives between shareholders and the people that are in positions to drive value.
vincentmarle 5y ago
In a capitalist society, wealth accumulation by the capitalist class has no relation whatsoever to number of hours worked or level of productivity. It is in fact the opposite, their wealth increases non-linearly to any input; ownership is all that matters. The worker class however, the Foxconn employees you’re talking about, have a linear relationship to their income, and yes, are generally taken advantage of by the capitalist class. It doesn’t matter that Tim Cook is a salaried employee, he is still part of the capitalist class because his income depends largely on Apple’s stock performance.
zeronine 5y ago
>What makes Apple treat Chinese workers so differently? You're asking the wrong question. It should be: Why is there no disincentive to take unfair advantage of cheap foreign labor?
- axelroze 5y ago
  Why there should be? We live in a global free trade era. Every entity buys cheapest and sells dearest as they can to the best of the information they have. Labour is just one more thing available for buying. Not saying this is the best possible humans can do but in the current world economic system it makes no sense for anyone to dis incentivise employing cheaper foreign labour.
brk 5y ago
My question is: how is Tim so productive that he does roughly 160,000 people’s work, or 1/8th of Foxconn’s total workforce? [2] /s My question is: if Tim Cook didn't exist, would any of those Foxconn workers have jobs? My other questions is: if you put 160,190 Foxconn workers in front of 160,190 development environments, how long before they would randomly re-create the iPhone? You can't compare salaries, or even value, of people at two massively different levels in the machine. Is Tim Cook "worth" more than 160,190 Foxconn workers? Apple's board and investors seem to think so, and they are Apple's ultimate "customer", being that it is a publicly traded company.
- TrackerFF 5y ago
  I think it's a interesting discussion, because often when CEO comps come under scrutiny, one side will naturally argue that company performance correlated directly to CEO performance. Stock goes up = CEO does good job Stock stagnates or goes down = CEO does a bad job. It's an incredibly complex ting to analyze - but how much of company performance is really the result of the CEO, and the CEO alone? Sure, he sets the N-year course of the company, and being the navigator and captain of a ship, you should get some reward if the ship arrives its destination, intact, and on time. But I mean, how much of Apple company performance is nothing more than just built up momentum? Apple doesn't need to be revolutionary or cutting edge. They just need to adopt working/in-demand products to their own (Apple) domain, and their brand name alone will sell those products. Those Foxconn workers would likely have their jobs, Tim Cook or not in charge. And if not Foxconn, then some other factories and factory workers. Ok, that's a lot of rambling, but I guess my point is that when you're dealing with a behemoth of a company like Apple, with hundreds of millions of users locked in to their products, it's difficult to credit a CEO alone of the success.
- ZephyrBlu 5y ago
  I would actually propose that Tim Cook could be worth infinitely more than 160,190 Foxconn workers because they may have never re-created the iPhone.
sumedh 5y ago
> how is Tim so productive that he does roughly 160,000 people’s work How many Blackberry or Palms phones are being made, if the person at the top screws up, all those workers are out of a job.
bzbarsky 5y ago
> If we divide Tim's $750,000,000 bonus/payout this year by that $4,681.92 yearly Foxconn salary, we get 160,190 Why are we dividing a once-in-10-years (based on targets set 10 years ago) bonus by an every-year salary number? As in, all your numbers are off by a factor of 10, as far as I can see.
fighterpilot 5y ago
Supply and demand. How many people can assemble widgets? Billions of people. How many people can make the correct decisions as a CEO of a large company? Really not many, since you need someone with an IQ over 140, someone with industry expertise, with the right personality, etc. So the supply is low. Also the demand is high, since that person's decision making has multi-billion dollar consequences. Low supply and high demand equal $$$.
- axelroze 5y ago
  That's the biggest problem with the current monopoly capitalism. Centralization of power into single people making decisions with momentous impacts (be they 140+ IQ or total idiots as some other CEOs are). A good economy is made from small and medium enterprises in which some of them failing do not make much of a difference. That is also the basis of a good investment strategy, diversification. If the single person in power does good then everything is good (more for the top people but good for everyone nonetheless). But if they do bad then thousands to hundreds of thousands of people suffer. (Reminds you of monarchy?) And the current way of looking at this is just to hope that the person in power will be happy to do good due to more shares. What would be, in my opinion, better would be to split FAANGS and encourage SMEs (small and medium enterprises)

SMAAART 5y ago

Recipe to have a nonsensical argument: 1. Take a Normal distribution 2. Take 2 pieces of data that are 3 standard deviation from mean, in opposite directions 3. Compare and contrast 4. Keep a straight face while making the argument, use plenty of Logical fallacies to defend your position against logic and reasoning. 5. Alternate between attacking and being the victim. 6. Lather, rinse, repeat

ZephyrBlu 5y ago
Emotional arguments are more effective than logical ones, even if you are talking to smart people.
- SMAAART 5y ago
  And that is the most logical statement. Thank you for the reminder.

viztor 5y ago

That's the definition of capitalism.

zpeti 5y ago

As a comment already says, this was due to meeting targets agreed 10 years ago. Now a lot of that is due to share prices, and my opinion is share prices are not set by the market any more, are massively inflated to make the US government look good, but that doesn't have much to do with Cook, much like Tesla's share price doesn't have much to do with Elon Musk (I'm serious, the guy is good at marketing, but that only takes you so far). There's been low interest rates for almost 2 decades now. One of the primary effects of that is inflated share prices. So, to say the least, this is a complex situation. Comparing Cook's renumeration to a chinese worker is just silly.

axelroze 5y ago
Speaking of Tesla's share price. It has Price/Earnings (PE) ratio of 1095 while a normal ratio is around 5 to 10, perhaps around 20 for tech companies. Apple's PE is 29. Share prices have definitely lost all sense in March 2020. One should keep that in mind when analysing the current economy.

spottybanana 5y ago

> My question is: how is Tim so productive that he does roughly 160,000 people’s work, or 1/8th of Foxconn’s total workforce? [2] /s Nobody has been making these productivity claims to begin with, but leftists commonly use productivity vs salary to ridicule CEO compensation. CEOs are paid for numerous reasons, for example board wants to trust the person with billions worth of assets which makes it sensible to pay certain amount just to guarantee greed doesnt take over, for example. Productivity is one factor but I doubt it is always the most important thing.

mellavora 5y ago
Wait-- so paying large amounts stops greed from taking over? I wonder how that is working for them. though you have a valid point, CEO pay isn't about CEO productivity, it is about corporate productivity.
akie 5y ago
You are justifying someone being paid $750m. No one needs that much money. No one. Why are you defending this? It's obscene. Really reminds me of this https://i.kym-cdn.com/photos/images/original/002/147/150/e2c.png https://i.kym-cdn.com/photos/images/original/002/147/150/e2c...
- Grustaf 5y ago
  Of course no one needs it. But the discussion here was if he had earned it, and he definitely has. Relative to value creation, I bet he’s very low in the CEO compensation league.
  - inetknght 5y ago
    > But the discussion here was if he had earned it, and he definitely has. I disagree. > Relative to value creation, I bet he’s very low in the CEO compensation league. You really think Tim Cook has created the value of the company? I very seriously doubt it. At the risk of whataboutisms: what about the engineers who did the work? What about the factory workers who did the work? What about the contractors who did the work? Tim Cook didn't create the value. He created a contract. That's all.

rglullis 5y ago

When will we learn to stop making these silly calculations about "productivity" and understand that people are paid not by the value of their work, but by their scarcity? Any factory in China can replace most of their 160k employees overnight if they wanted to. How many Tim Cook's do you have lying around?

lostinquebec 5y ago
.. and how many Ballmers!
Aeolun 5y ago
> by their scarcity By their perceived scarcity Chances are that anyone other than Tim could have done just as well. Still, this is over 10 years, and Apple shares have increased in value by 1900%. If they were still the same value he’d have gotten 40M, for about 4M per year. Which is much more reasonable. I still think it’s high, but in line with what others get.
- UncleMeat 5y ago
  Because it should be about productivity. People are highlighting a moral failing of society.
  - ChrisLomont 5y ago
    Is that moral failing related to jealously about how others choose to spend money that isn't theirs?
    - UncleMeat 5y ago
      Money is not gifted to people by God. It is allocated to people by systems that society chooses. The idea of the specific "rightful" ownership of money we have today is not universal throughout history and can change.
      - 5y ago

Grustaf 5y ago

Put it this way. In the last 5 years Tim Cook has created $1900 b in shareholder value. If you divide that by 160000 you get $12 m. Now I don’t know how many phones a foxconn worker can make per year, but I do think it’s fair to assume they do not each create much more than $2 m in value annually. Or another way to see it. While creating 2 trillion dollars of value for shareholders, he has been paid about 1.5 b. As a shareholder I think that’s very fair compensation. So relative to value creation, nobody can claim that he’s overpaid. A deeper questions is if it’s reasonable for anyone to own a billion dollars. I don’t think so, but Tim Cook has deserved the money more than most.

DasIch 5y ago
> In the last 5 years Tim Cook has created $1900 b in shareholder value. That's just obviously not the case unless Tim is the only person working at Apple. All employees contributed that and it's perfectly reasonable to discuss how these rewards should be distributed, even if they should be distributed to shareholders at all.
- Grustaf 5y ago
  No matter how you look at it, a CEO that earns less than 0.1% of the shareholder value created under his watch can’t reasonably be called overpaid.
  - breakfastduck 5y ago
    People seem to be really keen to forget that the CEO is an employee too. Should the shareholders profit exclusively when in effect the CEO is their representative? The argument isn't that he should be paid less, the real argument is that the general day to day employees should be paid more. The money doesn't come out of the CEOs pocket in a publicly traded org.
  - SamoyedFurFluff 5y ago
    “No matter how you look at it”? I question this because I personally am fairly persuaded that, if the CEO is not the only employee at the company, but the CEO is stated to earn “shareholder value under his watch” and then a portion being 0.1%, but another employee, say a manager or a director who also likely “created shareholder value” but earned 0.0000000001% or some other ridiculous fraction I would indeed question what makes the CEO different from the other employees such that they deserve so much more than the other employees that contributed to the shareholder value generation.

throwthere 5y ago

For starters divide everything by 10 because this was for the last ten years (first line in the article). I think your suggestion that pay should be closely tied to productivity is kind of correct, but it’s missing a “value” component— and Cook provided a lot of value to a lot of people, 100s of billions. Pro rata he’s just getting a small commission. It’s not like you can hire 1600 workers and replace Cook with them.

siva7 5y ago

i would expect such reasoning on tabloids but on hn?

leesalminen 5y ago
HN has been lurching left very quickly over the past years. Dunno if you’ve noticed.
- OJFord 5y ago
  True or not, that's not related to the accusation of 'tabloid reasoning'. See political leanings of UK tabloids for example: https://en.wikipedia.org/wiki/List_of_newspapers_in_the_United_Kingdom#Tabloid_newspapers https://en.wikipedia.org/wiki/List_of_newspapers_in_the_Unit...

nvilcins 5y ago

Adding two _trillion_ dollars of net worth sounds pretty productive to me.

robin_reala 5y ago
Out of interest, how much of that two trillion dollars do you think is directly attributable to the role of CEO?
- nvilcins 5y ago
  No less than 5%, or 100 billion.

Kiro 5y ago

Sorry, but your question is something I would expect a kid to ask the first time they become aware of inequality. Compassionate but extremely basic. The problem obviously can't be distilled to such a simple and shallow question.

cartbeforehorse 5y ago
imagine how many potential Tim Cooks are among those workers who can't ever become Tim Cooks due to their circumstances

willcipriano 5y ago

What I find interesting is none of the outlets who are currntly proclaiming that there is a worker shortage ever mention the executive shortage. The executive shortage has massive impacts on firms, imagine how much value could be generated for the shareholders by the 750 million that was just blown on compensation? We should create tax incentives for firms to offshore their executives, as well as immigration programs that shackle executives in a job with fears of deportation for them and their families should they dare ask to be compensated like their domestic peers in order to improve the fitness and agility of the US economy.

deleted 5y ago

[deleted]

option 5y ago

it is not about being 160K more productive. It is about supply and demand (of talent). Try finding even 5 Tim Cooks, not 160K. He is hired by Apple’s shareholders, what would happen to share price if he leaves?

varnaud 5y ago

Tim Cook can pay the Chinese workers rounding errors on his net worth because they and the other workers able to do similar work are not organized. They have no power. They can't ask for better working condition and better salary. Also, he really cares about making money, so since the workers have no power, why give them anything else than the minimum and get yourself the maximum? Who cares about some random oversea workers? Their problem, not mine. /s

tailspin2019 5y ago

Most of the comments are focusing on your salary comparisons, and while I do think it's not quite as simple as what you've laid out (we know how capitalism and its reward structures work), the wider and much more important point I take from your comment is about how workers in these overseas factories are treated generally, not necessarily just about what they're paid. There clearly IS a problem here. It's not just Apple and it's not just corporations, we all (in the West) have to take a bit of responsibility around this. So for everyone disagreeing with you, I do think you raise/{remind us of} some important ethical issues that do need ongoing and open discussion.

xornox 5y ago

For some reason owners of Apple value Tim Cook worth of billions. I am sure that if you can replace Tim Cook and work for 390$ per month, owners will happily fire Tim Cook.

MikeLumos 5y ago

How many of those 160,000 people would be able to successfully run Apple? Would all 160,000 of them put together be able to do a better job than Tim did?

ericmay 5y ago

Ok now do this same exercise with your own salary. In fact, anyone here can. Are you as a software engineer making $200,000+ delivering as much value as ~42 of these Chinese laborers at Foxconn? I doubt it. And people pointing to Tim Cook about how it’s all unfair and everything. Dang I mean the cognitive dissonance and ego to think that you making 42x a worker is ok because the JIRA tickets you addressed add a lot to the bottom line but Tim Cook just makes too much? Personally I don’t really care. Just find it interesting to see how people justify themselves.

ultimatedogewow 5y ago
tbh I don‘t. Even compared to people in my country I feel like I‘m not creating much more value than those paid a minimum wage. I rather feel both lucky working in an industry where (too) much money changes hands and a bit guilty, too

jfroma 5y ago

Maybe a little off topic, but in my country you will have a very good life with $390 per month and yet we have near 35% of our population living on poverty. The minimum wage is a little lower than that and there are a lot of laws favoring employees which makes it really hard for companies to hire. Just to give you an example, last year the president signed a decree to forbid companies firing people with the excuse of covid, nothing but a populist measure. The result is that no company will ever hire here, which creates more unemployment. I mention this because giving a lot of rights to employees by law sounds good but I have seen and lived the consequences my entire life. Should apple on their own pay more to chineese people? I think another comment address that, at the end is an scarcity problem, supply and demand.

dudul 5y ago

Compensation is a function of how difficult it is to find/replace a worker, not their productivity.

scyzoryk_xyz 5y ago

Chinese workers don't work for Apple. Apple, like any giant manufacturing conglomerate, relies on a complex supply chain of manufacturers who supply them with all the necessary parts and components. These manufacturers are also purchasing from even higher in the supply chain. As a company, Apple buys parts from suppliers, period. None of their business how these suppliers squeeze to deliver these parts at the best prices and quality. Before Apple arrived at the current position (2000-2010) they were a small player and it wasn't possible to squeeze parts suppliers. Tim Cook gets an enormous payout because he navigated the company towards flipping this relationship, because he is an expert in squeezing the best quality/price for the parts. Getting the iPhone below $1000 is what gets him his $750mil

cascom 5y ago

Because those workers are not in a position to effect meaningful marginal value creation. Let’s say you paid that $750m in bonuses to those factory workers, what value was created for shareholders? Zero, because Apple doesn’t have a capacity problem producing iPhones… Who knows how much value Tim Cook created vs some other CEO (he may have destroyed value), we’ll never know, but I think the philosophy is to align incentives between shareholders and the people that are in positions to drive value.

vincentmarle 5y ago

In a capitalist society, wealth accumulation by the capitalist class has no relation whatsoever to number of hours worked or level of productivity. It is in fact the opposite, their wealth increases non-linearly to any input; ownership is all that matters. The worker class however, the Foxconn employees you’re talking about, have a linear relationship to their income, and yes, are generally taken advantage of by the capitalist class. It doesn’t matter that Tim Cook is a salaried employee, he is still part of the capitalist class because his income depends largely on Apple’s stock performance.

zeronine 5y ago

>What makes Apple treat Chinese workers so differently? You're asking the wrong question. It should be: Why is there no disincentive to take unfair advantage of cheap foreign labor?

axelroze 5y ago
Why there should be? We live in a global free trade era. Every entity buys cheapest and sells dearest as they can to the best of the information they have. Labour is just one more thing available for buying. Not saying this is the best possible humans can do but in the current world economic system it makes no sense for anyone to dis incentivise employing cheaper foreign labour.

brk 5y ago

My question is: how is Tim so productive that he does roughly 160,000 people’s work, or 1/8th of Foxconn’s total workforce? [2] /s My question is: if Tim Cook didn't exist, would any of those Foxconn workers have jobs? My other questions is: if you put 160,190 Foxconn workers in front of 160,190 development environments, how long before they would randomly re-create the iPhone? You can't compare salaries, or even value, of people at two massively different levels in the machine. Is Tim Cook "worth" more than 160,190 Foxconn workers? Apple's board and investors seem to think so, and they are Apple's ultimate "customer", being that it is a publicly traded company.

TrackerFF 5y ago
I think it's a interesting discussion, because often when CEO comps come under scrutiny, one side will naturally argue that company performance correlated directly to CEO performance. Stock goes up = CEO does good job Stock stagnates or goes down = CEO does a bad job. It's an incredibly complex ting to analyze - but how much of company performance is really the result of the CEO, and the CEO alone? Sure, he sets the N-year course of the company, and being the navigator and captain of a ship, you should get some reward if the ship arrives its destination, intact, and on time. But I mean, how much of Apple company performance is nothing more than just built up momentum? Apple doesn't need to be revolutionary or cutting edge. They just need to adopt working/in-demand products to their own (Apple) domain, and their brand name alone will sell those products. Those Foxconn workers would likely have their jobs, Tim Cook or not in charge. And if not Foxconn, then some other factories and factory workers. Ok, that's a lot of rambling, but I guess my point is that when you're dealing with a behemoth of a company like Apple, with hundreds of millions of users locked in to their products, it's difficult to credit a CEO alone of the success.
ZephyrBlu 5y ago
I would actually propose that Tim Cook could be worth infinitely more than 160,190 Foxconn workers because they may have never re-created the iPhone.

sumedh 5y ago

> how is Tim so productive that he does roughly 160,000 people’s work How many Blackberry or Palms phones are being made, if the person at the top screws up, all those workers are out of a job.

bzbarsky 5y ago

> If we divide Tim's $750,000,000 bonus/payout this year by that $4,681.92 yearly Foxconn salary, we get 160,190 Why are we dividing a once-in-10-years (based on targets set 10 years ago) bonus by an every-year salary number? As in, all your numbers are off by a factor of 10, as far as I can see.

fighterpilot 5y ago

Supply and demand. How many people can assemble widgets? Billions of people. How many people can make the correct decisions as a CEO of a large company? Really not many, since you need someone with an IQ over 140, someone with industry expertise, with the right personality, etc. So the supply is low. Also the demand is high, since that person's decision making has multi-billion dollar consequences. Low supply and high demand equal $$$.

axelroze 5y ago
That's the biggest problem with the current monopoly capitalism. Centralization of power into single people making decisions with momentous impacts (be they 140+ IQ or total idiots as some other CEOs are). A good economy is made from small and medium enterprises in which some of them failing do not make much of a difference. That is also the basis of a good investment strategy, diversification. If the single person in power does good then everything is good (more for the top people but good for everyone nonetheless). But if they do bad then thousands to hundreds of thousands of people suffer. (Reminds you of monarchy?) And the current way of looking at this is just to hope that the person in power will be happy to do good due to more shares. What would be, in my opinion, better would be to split FAANGS and encourage SMEs (small and medium enterprises)