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How'd You Feel If Your Boss Made $486 For Every Dollar You Make?

I have no idea why I was offered a contract with a bonus in it because I promise you I will not work any harder or any less hard in any year, in any day because someone is going to pay me more or less.
-- John Cryan, CEO, Deutsche Bank​


There's no question that a public firm's CEO must be very adept at a lot of things, things most folks need not be good at. That said, there's a notion that by paying more a firm will obtain a better quality employee, and it strains credulity to think, and research concurs, a CEO receiving a $10M compensation package is a worse quality, worse performing CEO than one given a $15M or $30M package.
  • CEO and Senior Executive Compensation in Private Companies
  • Rethinking Executive Pay Design or Are CEOs Paid for Performance?
    • "Has CEO pay reflected long-term stock performance? In a word, 'no.

      "Companies that awarded their Chief Executive Officers (CEOs) higher equity incentives had below-median returns based on a sample of 429 large-cap U.S. companies observed from 2006 to 2015. On a 10-year cumulative basis, total shareholder returns of those companies whose total summary pay (the level that must be disclosed in the summary tables of proxy statements) was below their sector median outperformed those companies where pay exceeded the sector median by as much as 39%."
  • Interesting study, but it's ancillary to this thread's topic: CEO pay: Still not related to performance (health care industry specific)
  • Stop Paying Executives for Performance
    • "Companies should abolish contingent pay for their top executives because theirs is the least appropriate job for it. Decades of strong evidence make it clear that large performance-related incentives work for routine tasks, but are detrimental when the tasks is not standard and requires creativity."
      • Off-Topic:
        Some of you may have read my engagement bonus remarks from a different thread. The discussion and linked content you'll find at the above linked document discusses the principle behind that approach. When I negotiated those bonus clauses, I knew the instant my staff learned of them, they'd ask if I could rebalance the project workplan so we could be all but assured of earning the bonus. You know damn well, I told them I'd be happy to do just that, and earn the bonuses we did. That put material sums in my people's pockets.
    • "Abundant evidence shows that people -- including top managers -- will in fact start to behave differently if you make a large proportion of their remuneration dependent on some measure of performance. But it will not be in a way you want them to behave."
Am I suggestion we pay CEOs less? Not necessarily, but I wouldn't object to that outcome. I'm saying firms don't need to pay them more in order to obtain the CEOs maximum/optimum performance.
 
OldFatGuy said:
Blah, blah, blah. Yadda, yadda, yadda. Blame someone else for your own failures in this life. Got it.
Click to expand...

My failure to buy into government propaganda?

I take that as a compliment, thanks.

You may buy into it, but I don't.
 
I feel sorry for major league baseball and football coaches only getting a million dollars a year while the players are making 30 million a year.
 
jonny5 said:
Cons take the side of freedom. Because they also want to be wealthier and they know that capitalism works better than socialism at achieving happiness.
Click to expand...

The amassing of great fortunes historically has come at the expense of the happiness of others, generally.
 
Lutherf said:
The idea that an employee should get a higher wage merely because their boss makes more money than they do is ridiculous.
Click to expand...

The idea that anyone is actually hundreds of times "better" than anybody else is ridiculous.

Several times yes. Ten-twenty times? Maybe. Five hundred times? No way.
 
Buzz62 said:
Yup.
Anyone who says "Money can't buy you happiness"...never had money before.
Click to expand...

It study after study has determined that the level at which more money doesn't improve happiness anymore is surprisingly low. Less than six figures here.

Those who continue to grab money with both hands beyond that point are feeding their drive for status, which in social species confers better access to resources, from an evolutionary perspective.

While we were evolving this hunger was held in check by our lifestyle. Alpha predators living in large extended families. Greed and power as we conceive of them didn't exist. (And the whole "life was nasty, brutish and short" bit was just propaganda to justify colonization. But that's a topic for another thread) wealth was limited to what you could carry. Power was conditional. "The strong dominated the weak" isn't true either. Life eliminated the weak. Those who survived were all strong. We killed and ate animals much larger than ourselves while avoiding being eaten by animals much larger than ourselves. There were no ectomorphs to subjugate.

The kind of wealth and power we see today is a result of settling down and growing food. Everywhere this eventually resulted in having to lock up and dole out that food. This created wage labor, the manager class and professional soldiers/guards.

And we lost our ability to simply say "no" to those who sought to increase their status by claiming more than those they had power over. To spend our lives gaining more power and wealth through conquest. Etc etc.

All to feed an addiction to the pleasurable neurochemicals our brains give us for improving our access to resources. Our "status" in the group. The "urge to empire".

Left unchecked this wrecks that society. Historically. Overextended in conquest or conquered. Revolution. Etc.

All symptoms of our Maladaptation to the Adoption of the Sedentary Lifestyle.
 
joko104 said:
Democrats talk - but do nothing. Not ONE Democratic candidate for president ever mentions closing tax loopholes for the super rich.

It is a bizarre view you have that "working class conservative Republicans" should join Democrats in promoting millions and millions of low skill migrants coming to the USA driving down wages and taking their jobs - and join Democrats in the mass of regulations that have crushed American industries and their jobs.

Mostly, I don't understand why Democrats such as you in your messages believe it persuades anyone to pretend to be conservative on this forum, as they post leftwing and socialist messages. Do you think that gives you so persuasive edge?
Click to expand...

Republicans have never gone after employers. So they have donors that like cheap labor and general wage suppression too.

But you are correct that dems work for their wealthy donors too.

The only real difference between the parties is the dems have a slightly better philosophy as to the care and feeding of the livestock.

Both sides consider us livestock. Hell, capitalism officially declares the majority of us expendable commodities to he used and discarded at will by the ownership class.

Its really obvious that the business class decided that job "x" is only worth "y". And "y" has remained the same since, adjusted for inflation.
 
gdgyva said:
forced huh?

sounds like you are the one who is more like 1930's Germany than the republicans

take a look in the mirror....
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Can you name a revolution/collapse that wasn't in response to the excesses of those at the top of the heap? (Natural disasters don't count. Being conquered is some other powerhead feeding their Jones.)
 
joko104 said:
Employers pay only as much as they have to and employees want as much as they can get. That is how capitalism (and freedom) works.
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Yet sleeping is a privelege that must be paid for in America. Freedom is not getting to choose your landlord. Its the ability to choose to not have a landlord at all. Landlords are parasites that rely on government to enforce their feeding.
 
gdgyva said:
i believe we have LAWS that call that THEFT

and they put you in a cell with guys named BUBBA

and Bubba uses you as a sex toy....but by all means, steal away
Click to expand...

We also call that "conquest" and "colonization" when its pointing down instead of up.
 
What if...? said:
The idea that anyone is actually hundreds of times "better" than anybody else is ridiculous.

Several times yes. Ten-twenty times? Maybe. Five hundred times? No way.
Click to expand...

This take exposes another common misconception.

Your rate of pay isn't strictly an indication of how good you are at your job. It is FAR more an indication of the risks, responsibilities and income potential related to your job. Not all jobs are equal.
 
What if...? said:
Can you name a revolution/collapse that wasn't in response to the excesses of those at the top of the heap? (Natural disasters don't count. Being conquered is some other powerhead feeding their Jones.)
Click to expand...

do you believe the masses are getting ready for a revolution akin to the French during the 1700's?

really?
 
Lutherf said:
This take exposes another common misconception.

Your rate of pay isn't strictly an indication of how good you are at your job. It is FAR more an indication of the risks, responsibilities and income potential related to your job. Not all jobs are equal.
Click to expand...

No, not all jobs are equal. But those of us in the real world, get adjustments based on performance. CEO's are raking in excessive cash, in the form of salaries, bonuses, stock options, etc., regardless of their performance. If "Say on Pay" was working, it might be a different situation. That said, according to Fortune magazine, it is working. However, if you read the article, it's not very convincing...

Surprise surprise: Say on Pay appears to be working | Fortune

Unlike JPMorgan (JPM, +4.63%), where almost 40% of shareholders voted against CEO Jamie Dimon’s pay package, most Say on Pay votes—where companies ask their shareholders what they think of their executive pay packages—are generally in the 90% and up approval range.

Unlike Jamie Dimon, who accused his shareholders of being lazy, most CEOs know that if shareholders disapprove, pay must change. But since most pay packages are approved, it doesn’t seem likely that Say on Pay is going to have much effect on CEO compensation.

It doesn’t seem likely, but it has.

Asking shareholders is simply asking the wealthy to vote for each other. Heck, a lot of the shares are held by CEO and upper-level executives. They are voting for themselves. I believe the employees should also be entitled to vote somehow, on a 1 for 1 basis. Weight of voting could be 50% shareholder opinion and 50% employee opinion. Employees know their CEO better than external shareholders.
 
AlbqOwl said:
Having been a CEO of sorts at one time, I didn't make a lot more than a lot of my staff, but the responsibility and expertise necessary is quite a bit more. You not only have to know something about the workings of every department and function, etc. you have to be on top of promotions/advertising, finances, revenue or in my case fund raising because it was a NFP organization, and your personal liability in many times over what any of the other personnel has. And keeping a board of directors and/or investors happy is no easy feat.

In other businesses, yes, my boss often made a huge salary compared to mine. But he was the one who took the risk to start the business, invested the capital and put it at risk, and assumes ALL the liability risk for the company. And he could have hired any number of other people, but he chose to offer me a job I very much needed and appreciated. What he offers to pay me is his call and it is my call whether I am willing to work for what he offers. If we can't agree on that we can wish each other well and each go our our merry way. But what HE makes is none of my business.
Click to expand...

The problems with these pay divides become a bigger problem when employees don't see the value add of CEO compensation in how the company is run. If a CEO pushes policies which bring added revenue to the company which translate into career growth opportunities for employees, then it's a tangible value add people understand. It's when CEOs favor actions which only benefit shareholders and stifle employee career growth (or downsize), then the high compensation is less justified in the minds of employees.
 
What if...? said:
We also call that "conquest" and "colonization" when its pointing down instead of up.
Click to expand...

only those days are over....and no one is conquering another here in america

the colonization is over

people come here for one reason....to try to achieve the "american dream"

and that varies for every person you talk to.....for some it is a modest living, a nice life, and a great family

for others, they want it all....

we have every taste in america.....from those with small ambitions, to those with grandiose visions of taking over the world

that is why it is the great melting pot....and everyone can pursue THEIR dream....without government interference for the most part

you can work for others, or start your own business....your choice

we are a nation of choices and decisions.....and every one you make helps determine your own outcome

is it a completely level playing field? nope....never will be

some are born into wealth, and have a much easier time doing things, getting education, etc

but the path is still there for the worst off....
 
Media_Truth said:
No, not all jobs are equal. But those of us in the real world, get adjustments based on performance. CEO's are raking in excessive cash, in the form of salaries, bonuses, stock options, etc., regardless of their performance. If "Say on Pay" was working, it might be a different situation. That said, according to Fortune magazine, it is working. However, if you read the article, it's not very convincing...

Surprise surprise: Say on Pay appears to be working | Fortune

Unlike JPMorgan (JPM, +4.63%), where almost 40% of shareholders voted against CEO Jamie Dimon’s pay package, most Say on Pay votes—where companies ask their shareholders what they think of their executive pay packages—are generally in the 90% and up approval range.

Unlike Jamie Dimon, who accused his shareholders of being lazy, most CEOs know that if shareholders disapprove, pay must change. But since most pay packages are approved, it doesn’t seem likely that Say on Pay is going to have much effect on CEO compensation.

It doesn’t seem likely, but it has.

Asking shareholders is simply asking the wealthy to vote for each other. Heck, a lot of the shares are held by CEO and upper-level executives. They are voting for themselves. I believe the employees should also be entitled to vote somehow, on a 1 for 1 basis. Weight of voting could be 50% shareholder opinion and 50% employee opinion. Employees know their CEO better than external shareholders.
Click to expand...

actually at most S&P 500 companies, the executives and board hold less than 3% of all outstanding shares

the shares for the most part are held by mutual funds, ETF's, and venture capitalists....with a small percentage being held by private investors like me in my portfolio not assigned to funds/etfs

so the asking of shareholders to approve pay has been a positive move in my opinion.....

mutual fund managers get paid on stock performance, and if the company is not performing well, they can vote down their shares easily

the programs are fairly new, so not enough time has gone by to see if that is what is happening yet.....

but i am HOPEFUL
 
gdgyva said:
actually at most S&P 500 companies, the executives and board hold less than 3% of all outstanding shares

the shares for the most part are held by mutual funds, ETF's, and venture capitalists....with a small percentage being held by private investors like me in my portfolio not assigned to funds/etfs

so the asking of shareholders to approve pay has been a positive move in my opinion.....

mutual fund managers get paid on stock performance, and if the company is not performing well, they can vote down their shares easily

the programs are fairly new, so not enough time has gone by to see if that is what is happening yet.....

but i am HOPEFUL
Click to expand...

I'll cross my fingers too.
 
Media_Truth said:
You call it jealousy, I call it disdain of injustice. I have no problem with folks making more money than I do. That said, there are no checks and balances on CEOs and other high-level executives. They vote themselves raises and bonuses. They get paid hundreds of thousands of dollars to sit on the Boards of each other's corporations, and attend one meeting per year. As we saw with these bankers, during the bailout, their raises and bonuses are not tied to any Corporate performance or profits. They are accountable to noone, and they rob from everyone!
Click to expand...

Call it whatever you want. It all boils down to jealousy.
 
What if...? said:
Yet sleeping is a privelege that must be paid for in America. Freedom is not getting to choose your landlord. Its the ability to choose to not have a landlord at all. Landlords are parasites that rely on government to enforce their feeding.
Click to expand...

I understand you want someone else to do all the work to build and pay for your housing - and probably everything else for you too. The Democratic Party and most Democrats basically want their slaves back - only they don't even want the work of being a slave owner and task master. They want the government to enslave people for them to do all their work for them. Slavery has always been at the core of the Democratic Party. That is what is going to cause the collapse of the USA.
 
ElChupacabra said:
The problems with these pay divides become a bigger problem when employees don't see the value add of CEO compensation in how the company is run. If a CEO pushes policies which bring added revenue to the company which translate into career growth opportunities for employees, then it's a tangible value add people understand. It's when CEOs favor actions which only benefit shareholders and stifle employee career growth (or downsize), then the high compensation is less justified in the minds of employees.
Click to expand...

The minds of the employees should be devoted to making themselves valuable to their employer to justify more income, if that is their goal, and/or to qualify themselves for a higher paying position in the company or with another company. If the employees devote themselves to resentment re what the CEO earns, they are far likely to spend their lives in resentment instead of accomplishing their personal goals.

It is an extremely rare business from the smallest hot dog stand to the mom and pop dry cleaning store to medium size manufacturing plant to the largest corporations in the world that are in business as welfare organizations. And all rarely pay their employees more than the employees earn for the business plus a reasonable profit for the owners.

The boss owes me no more than avoidance of negligence that would affect my physical well being and otherwise only what he contracted with me to provide in the way of wages, etc. I owe the boss an honest day's work for the wages I agreed to work for. I can choose to merit only the wages I agreed to work for, or I can choose to make myself more valuable to my employer and thereby merit more wages. Or if there is no opportunity to improve my situation, then I will eventually move on to something better. I have done that numerous times over my lifetime. The employee who does just enough to keep from being fired probably won't enjoy as much monetary success as the employee who actively makes himself more valuable to the employer.

Just like super stars in Hollywood or the music industry or the sports world merit multi-million dollar salaries, so do the rare group of men and women who have the intuition, experience, ability, and talent to run large corporations effectively and profitably. And they can command very good incomes.

Right or wrong, it is not the merit of their work that necessarily qualifies them for those big salaries, but the rarity of people who can qualify for it. We might think it immoral that a rock star makes mega millions by doing nothing other than entertaining us while a person who risks his life to save others earns a very modest living. Maybe it is. But for every person with the talent to become a rock star, there are many thousands who can qualify for the job that saves lives. And the principle of supply and demand kicks in.

Very few employees know or understand what the CEO does to merit the salary he/she receives. But whatever it is, if I am working for that corporation, what the CEO does is making it possible for me to earn a living. And what he/she gets paid is none of my business.
 
AlbqOwl said:
The minds of the employees should be devoted to making themselves valuable to their employer to justify more income, if that is their goal, and/or to qualify themselves for a higher paying position in the company or with another company. If the employees devote themselves to resentment re what the CEO earns, they are far likely to spend their lives in resentment instead of accomplishing their personal goals.

It is an extremely rare business from the smallest hot dog stand to the mom and pop dry cleaning store to medium size manufacturing plant to the largest corporations in the world that are in business as welfare organizations. And all rarely pay their employees more than the employees earn for the business plus a reasonable profit for the owners.

The boss owes me no more than avoidance of negligence that would affect my physical well being and otherwise only what he contracted with me to provide in the way of wages, etc. I owe the boss an honest day's work for the wages I agreed to work for. I can choose to merit only the wages I agreed to work for, or I can choose to make myself more valuable to my employer and thereby merit more wages. Or if there is no opportunity to improve my situation, then I will eventually move on to something better. I have done that numerous times over my lifetime. The employee who does just enough to keep from being fired probably won't enjoy as much monetary success as the employee who actively makes himself more valuable to the employer.

Just like super stars in Hollywood or the music industry or the sports world merit multi-million dollar salaries, so do the rare group of men and women who have the intuition, experience, ability, and talent to run large corporations effectively and profitably. And they can command very good incomes.

Right or wrong, it is not the merit of their work that necessarily qualifies them for those big salaries, but the rarity of people who can qualify for it. We might think it immoral that a rock star makes mega millions by doing nothing other than entertaining us while a person who risks his life to save others earns a very modest living. Maybe it is. But for every person with the talent to become a rock star, there are many thousands who can qualify for the job that saves lives. And the principle of supply and demand kicks in.

Very few employees know or understand what the CEO does to merit the salary he/she receives. But whatever it is, if I am working for that corporation, what the CEO does is making it possible for me to earn a living. And what he/she gets paid is none of my business.
Click to expand...

What the CEO does has little to do with the success of a corporation. CEO's are a dime adozen. They do not contribute to the product/sevice being offered without those who actually create/offer the product service. That isn't how corporations function. And if the company is publicly owned, their salary is everyone's business.
 
chuckiechan said:
That is what makes outsourcing so popular. Why pay workers American pay and benefits when you can outsource the work to India. For example, in the architectural world, you send your plans to India for "re do" at 5PM, and they are on your computer by 8AM the next day. Why not buy assemblies from China in stead of pay an American assembly plant to do the work? Why not outsource call centers and clerical work to other countries and save a bundle on wages and benefits?

CEO's are often paid on increased profits. Cheap labor = high profits. When your competitors do it, it means you must do it to survive. That is why we are so bleeped.

What do you think core Trump hate is about, anyway. It's not just the noisy ignorant partisans! They are just fluff. It's the very bright, wealthy, new and old money multi nationalists that have the most to lose by Trump changing the nations supply chain. You don't hear much about them because they own the media, too.

Don't blame the CEO's blame the owner and board of directors who write the incentive packages.

Fun fact to research: Look into the 1/4 billion Melissa Meyers brought down as she destroyed Yahoo. It's all about monetizing by gifting the stockholders out of imaginary wealth.
Click to expand...

And yet trump gave all those guys a huge tax cut.
 
joko104 said:
Conservatives and capitalism promotes upward mobility. Liberalism and socialism promoted downward mobility. Their opinion is that everyone at the bottom should get a little more - and everyone should be and stay at the bottom except for the masters in government who have all power and all wealth.
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Unfortunately the dems are just working for different rich people. Neoliberals. Corporatists.

The slow march to oligarchy.
 
joko104 said:
There is no free and independent American press and media. They all went bankrupt with the Internet and were bought up by the corporate super rich of the world to use and their PR propaganda outlets. Accordingly, they promote their foreign child labor sweatshops, support mass immigrant to have a massive over supply of workers to keep wages at the absolute minimum, demand the government subsidize their employees with welfare, and demand huge levels of welfare for those whose jobs were lost to avoid a revolution.

Without a free and independent press and media, Democracy can't work. With an educational system that teaches students to hate their country that country will not survive well for long. President Trump is correct. The propaganda outlets of the global corporations and super rich are the worst enemy our country has.
Click to expand...

And yet, all of trumps keywords were focus grouped. By propagandists.
 
devildavid said:
What the CEO does has little to do with the success of a corporation. CEO's are a dime adozen. They do not contribute to the product/sevice being offered without those who actually create/offer the product service. That isn't how corporations function. And if the company is publicly owned, their salary is everyone's business.
Click to expand...

:roll:

Why don't you become a CEO and then you can be rich and do nothing too as you claim? Why aren't you a CEO? Just take your Ivy League MBA, corporate resume, and go be one.
 
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