Category Archives: gap between CEO pay and worker pay

CEO Pay and the Revolution

In the New York Times of 6/30/2013 there was an article in the business section entitled “An Unstoppable Climb in CEO pay” which I heard quoted several times of CNN last week, although it sort of got lost in a week that was an absolute fiesta of breaking news.

”According to an updated analysis, the top 200 chief executives at public companies with at least $1 billion in revenue actually got a big raise last year, over all. The research, conducted for Sunday Business by Equilar Inc., the executive compensation analysis firm, found that the median 2012 pay package came in at $15.1 million — a leap of 16 percent from 2011.” 

On Google+ a poster shares a graphic which shows a 725 increase in CEO pay in the past 14 years.

This next graphic will show you  more information about the differences between pay at the top and pay for the rest of us. Follow the link below if you want to see the actual graphic. I have summarized the information contained in the graphic in the chart you see after this link.  

Walmart                               1,034:1  CEO-to-Worker Pay Ratio             $23,150,000 Mike Duke’s Pay
                                                $22,400 Median Worker Pay                       Walmart pays below market
Target                                   597:1   CEO-to-Worker Ratio                      $17,890,000 Gregg S.’s Pay
                                                $29,900 Median Worker Pay                     Target Pays at Market
Walt Disney Co.                    557:1  CEO-to-Worker Ratio                       $31,630,000 Bob Iger’s Pay
                                                $56,800 Median Worker Pay                     WD pays +8% Above Market
Honeywell                          439:1  CEO-to-Worker Ratio                         $32,860,000 David Cote’s Pay
                                                $74,700 Median Worker Pay                    Honeywell Pays At Market
McDonald’s                        434:1  CEO-to-Worker Pay                  $ 9,550,000 James Skinner’s Pay
                                                $22,000 Median Worker Pay           McDonald’s Pays -6% Below Market
The 5 lowest pay ratio belong to Amazon at 18:1, Sunoco at 15:1, Microsoft at 12:1, Berkshire Hathaway, Inc at 9:1, and Google at 0:1.

I’m not sure we are at all surprised to know that the gap between CEO and worker pay is increasing. We may be surprised by the geometric progression of the increase in CEO pay. There can be repercussions if such a trend continues indefinitely. So, I want to make a hypothetical logical argument. I want to make it very clear that I am not trying to foment a revolution. However, I believe that it is commonly accepted that when wealth is concentrated in the hands of a relatively small number of people and when the gap between the richest people in a society and all other individuals in the society keeps growing wider and wider, eventually those at the bottom are likely to rebel against those at the top in order to once again equalize the distribution of wealth. I am not saying that we are at this point in America, but it looks like we may get to that point sooner rather than later if the distribution of wealth continues to follow the patterns that have been described above.

And it is also apparent that if any weapons stockpiles are being accumulated by any group of Americans then we might guess that Conservatives are ahead of other groups in this stockpiling given that they belong in greater numbers to the NRA and have been fanatically protective of their right to continue to stockpile weapons (including semi-automatic weapons and very large clips of ammunition). Odd, since a majority of the wealthiest Americans seem to lean right you would think that the poorer and poorer Conservatives in the party would feel some hostility to their big business leadership, but they seem to feel every bit as powerful as those who are stockpiling all of our money, instead of all of our guns. So pretty good for the right; in the event of a revolution Conservatives will have both the bucks and the buckaroos to wage war, but who will they wage war against? Will they wage war against their buddies with all the money. There doesn’t seem to be any hostility coming from the Conservatives at the bottom of the economic heap against the Conservatives at the top of the heap. All hostilities seem to be directed towards the left. Maybe Conservatives believe that if they help those in the GOP who have all the wealth win the day there will be some kind of quid pro quo when the revolution is over. 

I suppose we on the left have our moneyed honchos and honchettes also, but we may not have the weapons.  Perhaps us lefties need to start our weapons collecting and form secret militias and join shooting clubs to practice our marksmanship. Should we just let the right wingers have their way with America in Congress now so they won’t have to use their guns later? They would probably be rather disappointed if they could not point and shoot. They’ve been practicing for quite a while. However, it could exact a large toll on the population and infrastructure of America if they turn the country into a shooting gallery. Perhaps at some point Conservatives without bucks and liberals without bucks will form an alliance against those who have cornered all the bucks, but at this point that seems unlikely.

All right, call off the revolution for now. If we’re just going to end up as Tea Party Nation then why bother. We could pass some laws that reverse the laws that are letting all of the cream rise to the top of America, but we are told that redistribution of wealth is socialism, or communism, or fascism, or all three, and everyone seems to buy this, so laws that redistribute potential wealth will never be allowed. If we can’t reverse this trend that is creating an enormous gap between the few at the top and the many of us at the bottom something will eventually happen and I still contend that right now the Conservatives are better armed for the some-day revolution. So either start a gun cache now, or elect Democrats in 2014.

This is the view from the cheap seats.