I’m already convinced that America’s growing income gap and out of control executive pay are real problems that are getting worse. If you are not convinced, this article on executive pay may change your mind. Don’t miss the visual aids. (Via James Fallows.)
June 20, 2011 at 1:18 pm
All this tells me is that the fat cats are finally getting their return to the Gilded Age they’ve always wanted since the Great Depression / New Deal took place.
June 21, 2011 at 11:06 am
I wonder how much efforts to curb executive compensation have contributed to this trend. IIRC, in the early ’90s the amount of executive compensation a company could expense was limited to $1M and this lead to a huge increase in the use of stock options…and executives starting to focus on short term stock prices as their options began to vest. Of course, consider that their pay was now at risk, they also began to demand more of it. In addition, since most of the compensation wasn’t cash it didn’t hurt the companies bottom line.
I definitely think a good CEO is worth their weight in gold. The best example might be Steve Jobs who has been a miracle worker at Apple. $1 billion/year wouldn’t even begin to pay back what he’s done for that company. That said, a lot of the suits are empty and not worth 5% of what they are getting paid.