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Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

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Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#51

Post by astrange »

hinkley wrote: post #26
tysam_and wrote: post #9

There is an equation with an equilibrium: CEO's pay rate = (some multiplier) * median salaried worker's pay rate OR CEO's pay rate = (some multiplier) * minimum salaried worker's pay rate We've been conditioned to think it's not fair somehow, but the discrepancy is just....engorgingly terrible. I'm not arguing for how this metric would be enforced, only that it would be a good one to have. Especially in a time when g…

It's also been suggested that Congressional salaries be a fixed multiple of minimum wage, and for similar reasons. Honestly I think that would probably fix things a lot faster.

If you underpay elected officials then 1. they just start taking bribes 2. only rich people will run in the election.

This is why Singapore pays them even more than we do.

Anyway, minimum wages (despite being ok policies) aren't what people are actually paid, and of course aren't especially what non-working people are paid. And remember that non-working people, namely children and the elderly, are poorer than workers.

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#52

Post by fallingfrog »

SeanAnderson wrote: post #31

I've heard a counter-argument to this before and I'm curious to get other's take on it. Basically, the story goes that when an individual rises into a significant leadership position at a large enough company that the economic calculations become different. There's still an element of domain expertise, but, for the most part, leadership is leadership wherever you go. This implies that a leader could (potentially) mov…

I’d like to see one of these guys use their magic leadership mojo to lead a platoon of marines into battle. I think he’d find that domain knowledge does, in fact, matter.

To the extent that it truly doesn’t matter, the ceo is a glorified mascot.

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#53

Post by hackerlight »

econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

Is that an apples to apples comparison? Is the mean inflation-adjusted market cap of all the companies in both their 1978 dataset and 2021 dataset the same?

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#54

Post by dymk »

kortilla wrote: post #12
econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

There is no academic training to be a good CEO. They are not easily replaceable. If they were, board members wouldn’t bother offering such high pay. Shareholders don’t appreciate wasting money.

Of course there is training to be a CEO. Do you think all the good CEOs were born with the knowledge to be a CEO?

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#55

Post by gretch »

econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

I support the workers' decision and negotiating on labor rates is the basis of our economic system. Get what you deserve.

That said, the CEO pay is easily explainable:

> Profits at the struck auto companies increased 92% from 2013 to 2022, totaling $250 billion, according to EPI

> CEO pay at the Big Three has grown 40% in the last decade, according to EPI

If you're the CEO of a company and you increased profits by 92%, I don't know seems pretty fair to me. There's a lot of other businesses that suck and haven't raised their profits in the meanwhile.

I think talking about the CEO pay is the wrong path (though I do admit it's marketable in the mainstream news). Just ask for what you think you deserve and don't work if you don't get it. It's as simple as that.

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#56

Post by dymk »

Invictus0 wrote: post #25
econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

What if CEOs were underpaid in 1978?

They weren't

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#57

Post by highwaylights »

econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

To paint the above in starker terms:

Worker pay is set by the leadership, leadership pay is set by the leadership.

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#58

Post by hinkley »

astrange wrote: post #51
hinkley wrote: post #26

Earlier quoted context omitted.

It's also been suggested that Congressional salaries be a fixed multiple of minimum wage, and for similar reasons. Honestly I think that would probably fix things a lot faster.

If you underpay elected officials then 1. they just start taking bribes 2. only rich people will run in the election. This is why Singapore pays them even more than we do. Anyway, minimum wages (despite being ok policies) aren't what people are actually paid, and of course aren't especially what non-working people are paid. And remember that non-working people, namely children and the elderly, are poorer than workers…

THEY ALREADY DO

Nobody said the multiple has to be 5. It could be whatever the current ratio for Singapore is.

Re: Striking auto workers want a 40% pay increase–the same rate their CEOs’ pay grew

#59

Post by nerdponx »

endisneigh wrote: post #30
econperplexed wrote: post #8

> From 1978 to 2021, CEO pay grew by 1,460%, adjusted for inflation, versus just 18.1% for the typical worker. Why has the supply of CEOs not kept up with the demand for them? Surely, with the improvement in education and in increase in MBA programs, there must be far more CEOs today than in 1978. Why has the ratio of CEOs to Companies fallen by 14x for their wages to rise this much? /s As many argue, wages are only…

the supply of prospective management people definitely has kept up. there are literally tens of thousands of MBAs graduating every year, to say nothing of managers at existing F500 companies. there are only so many large companies, and thus so many CEOs. look at tiny barely profitable companies, the gap between median wage and CEO is sometimes less than 2X. all these takes on CEO pay when the reality is simple - CEOs…

> there are only so many large companies, and thus so many CEOs

This is a statement that there is low quantity demanded by the market. It's actually a great example of how the naive supply-and-demand argument doesn't make a lot of sense.

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