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CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

epi.org

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Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#131

Post by sekh60 »

dmix wrote: post #61
loandbehold wrote: post #49

Maybe Karl Marx had a point? Sure, communist revolutions of the 20th century produced suboptimal results, but only because violent psychopaths were in power. We need democratic socialism. Maybe Bernie Sanders has right ideas.

> but only because violent psychopaths were in power. There were way more problems with socialism than just the fact it breeds dictators. If you're starving your people in the time of greatest abundance of food in history it might be more fundamentally flawed.

A lot of starvation is due to the kulaks burning the crops so the communists wouldn't seize their land. Also times are even more prosperous now and people are still starving.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#132

Post by baron816 »

impulser_ wrote: post #118

Might have to due with the fact that the typical company is a lot larger than they were in 1978. Largest company in 1978 was GM they did about 53b in revenue, and 4b in gross profit. Largest company in 2022 is Apple they did 400b in revenue and 170b in gross profit. The list of people that can run and manage Apple is one, Tim Cook. The list of people that can work at Apple is millions.

Yeah, there really wasn’t much global competition either. So we have much larger companies competing all over the world against other huge companies.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#133

Post by gumby »

nell wrote: post #69

Capital allocators are always paid top dollar. CEOs are only a small part of it. Wall street bankers are paid top dollar too? They find investment opportunities that can generate returns. Traders make a lot of money too. What value do they add to society? They help in the price discovery of assets. Are they paid fairly, who knows? From a job complexity standpoint, CEO jobs are more challenging than bankers since they…

Finance is a service job (like lawyers, gardeners, doctors, haircutters, etc). The fact that money is attached gives them disproportional adulation and influence. Their useful function is making sure there is liquidity and availability of capital for companies and households to function, just like gardeners keep the weeds, down and help make the flowers flourish.

The celebrity obsession with CEOs mostly gets in the way of them doing their jobs, but the job at least is part of making something happen. Hired gun CEOs can do a lot for a company, but the pay is probably out of whack there too.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#134

Post by krapp »

naasking wrote: post #123
lm28469 wrote: post #2

It's just a matter of time before people revolt, we went from something like 1:6 employee:employer comp ratio to 1:400 (and much more for a lot of companies, up to 1:5000+) If we could harvest energy from the hardcore early capitalist theorists rolling in their graves we'd have infinite energy at that point

> It's just a matter of time before people revolt Trump was the first warning sign IMO, and some are still not taking it seriously, blaming the voters themselves for being so dissatisfied with the status quo that they would take a chance on someone like that.

>blaming the voters themselves for being so dissatisfied with the status quo that they would take a chance on someone like that.

It is the fault of the voters. Especially after it was obvious Trump was just a grifter who couldn't care less about the common man, and they voted for him again because they were scared of the immigrants and black activists with whom they should have had class solidarity. And it will still be the voters' fault when they vote for him a third time in 2024, based on whatever batshit QAnon lunacy their conservative truth-bubbles drip into their eyeballs.

And Trump wasn't the first warning sign by any means. Arguably Occupy was the first warning sign in recent memory. We don't recognize that because the current narrative is that "the left" supports the status quo of the elites, neoliberalism and capitalism while "the right" are the anti-capitalist, anti-statist underdogs.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#135

Post by esarbe »

naasking wrote: post #123
lm28469 wrote: post #2

It's just a matter of time before people revolt, we went from something like 1:6 employee:employer comp ratio to 1:400 (and much more for a lot of companies, up to 1:5000+) If we could harvest energy from the hardcore early capitalist theorists rolling in their graves we'd have infinite energy at that point

> It's just a matter of time before people revolt Trump was the first warning sign IMO, and some are still not taking it seriously, blaming the voters themselves for being so dissatisfied with the status quo that they would take a chance on someone like that.

Indeed!

Trump winning was to a large degree just a sign of the times; too many people were unsatisfied with the status quo.

2016 had two outsider candidates (Trump, Sanders) and while the Democrats managed to smother their revolt, the Republicans - because of existing structures, see "Tea party" - didn't.

In his term of office, Trump managed to address few of the problems that got him elected to office - the discontentment is still there, brewing and festering.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#136

Post by cbsmith »

wpasc wrote: post #78

I see a lot of revolution and socialism vs capitalism comments here, but isn't this a not surprising finding given corporate consolidation and increase in CEO:total worker ratio? Sure, there's debate about pro's and con's of corporate consolidation and market failures surrounding monopolies and oligopolies. But, with the increase in connectivity between regions via telecom, internet, mobile, etc; wouldn't there be an…

> I see a lot of revolution and socialism vs capitalism comments here, but isn't this a not surprising finding given corporate consolidation and increase in CEO:total worker ratio?

Sure, I guess that makes sense, except... given what corporate consolidation and increase in CEO:total worker ratio? Sure, you hear lots of news stories about mergers and worries about competition, but the likes of US Steel, GM, etc. used to have way more employees. Tech companies generally have fewer employees that comparable sized (by revenue) companies of yore. I'd sure need to see some evidence that the CEO:total worker ratio has actually increased...

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#137

Post by latency-guy2 »

I had a much longer comment detailing my problems with this article, but it got quite unwiedly by the end being confused about various statements and representations of data. I won't touch upon those things as it seems others have already given some thought into a portion of the same topics.

I'd like to talk about Josh Bivens in general, this article appears to be a continuation of a similar one done in 2019: https://www.epi.org/publication/reining-in-ceo-compensation-..., and another one from 2013: https://www.epi.org/publication/pay-corporate-executives-fin..., yet another in 2011: https://www.epi.org/publication/ceo-ratio-average-worker/

I find it interesting that the key numbers rarely change, beginning years are deliberately used (1978), even though there is nothing really significant about 1978 in particular for economic terms. But why keep using that as the same starting year through so many articles through the years?

It also appears that Josh Bivens is Keynesian in beliefs. Previous articles support this beginning from ~2009 onwards, and becoming more apparent through to the 2012 US Presidential election. Bivens has rather strong support for Occupy Wall Street, numerous articles stating as much.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#138

Post by esarbe »

krapp wrote: post #134
naasking wrote: post #123

Earlier quoted context omitted.

> It's just a matter of time before people revolt Trump was the first warning sign IMO, and some are still not taking it seriously, blaming the voters themselves for being so dissatisfied with the status quo that they would take a chance on someone like that.

>blaming the voters themselves for being so dissatisfied with the status quo that they would take a chance on someone like that. It is the fault of the voters. Especially after it was obvious Trump was just a grifter who couldn't care less about the common man, and they voted for him again because they were scared of the immigrants and black activists with whom they should have had class solidarity. And it will still…

Voters in the US have very little actual influence when it comes to national politics. Yes, they have one final vote, but their vote is highly distorted due to systemic issues, like e.g. first-past-the-post.

There are 300 million people in the US. How come the voters only get to make a binary decision? Simple; because the two parties have designed everything so that the voter only gets to make that decision.

So, I'd say that blaming the voters is a bit short-sighted when it comes to a quasi-aristocracy like the US.

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#139

Post by deltree7 »

cbsmith wrote: post #120
deltree7 wrote: post #112

Earlier quoted context omitted.

Yes. 1) Technology has always helped Top Performers. So, it is natural that the impact of high performers will grow faster than average performers. 2) American CEOs now also increasingly service the rest of the world. So, naturally their Total-Addressable-Impact have grown significantly. US Management Innovation are adapted / copied quickly unlike the rest of the world 3) Musk, Jobs, Bezos, Nadella have demonstrably…

> Musk, Jobs, Bezos, Nadella have demonstrably added Trillions of Dollars of value to their firms. So, it make sense to award a %age of value they create Unlike CEO's of yore who contributed a tenth of the value to their companies?

It's Math 101. CEOs compensation is typically tied to Market Caps of firms, while employees have fixed/sticky wages.

In the 'Yore' It took a great deal of time for any firm to add $1 Billion value to their Market Cap. So, naturally CEOs compensation grew slowly.

In the modern era, companies can add a Trillion Market Cap in a year. So, naturally CEO's growth rate will rapidly grow.

A lot of phenomenon in this world can be explained if you apply Mathematical concepts and natural laws instead of resorting to conspiracy, billionaire-hate and anything lately pushed by mainstream media

Re: CEO pay skyrocketed 1,460% since 1978: CEOs paid 399 times as much vs. worker

#140

Post by zokier »

lm28469 wrote: post #10
walkhour wrote: post #4

Earlier quoted context omitted.

What does a revolt look like? People can live in unimaginable conditions and not revolt. The idea that if things get bad enough "people" are going to do something about it can just occur to someone that hasn't seen enough of the world.

CEOs getting insane pay doesn't exist in a vacuum. You can't use the "trickle down" economy as a proverbial carrot when people can't put gas in their car or heat their home while Bezos&co buy a new yacht every other day > The idea that if things get bad enough "people" are going to do something about it can just occur to someone that hasn't seen enough of the world. Or I'm French, who knows ;) Continue selling ports…

Problem with the idea of heads rolling is that it doesn't really achieve anything. Let's hypothetically say you just stormed the parliament and slaughtered all the members there. Then what? Install military junta? That requires actual military backing, and doesn't exactly have great track record. Hold new elections? Attacking democratic institution seems unlikely strategy for winning seats, and if you think you can win that way then why did you need violence in the first place?
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