Like many, if not all, arguments of the left it is based in idealism and not reality. What people want, versus what the labor market can possibly mathematically deliver. Hope and not reality.
Because of this, their arguments are founded on weak clay foundations, and it doesn't take much research or empiricism to prove them wrong. So after (literally) 5 minutes of research I was able to pull some quick statistics and facts, do a little bit of 3rd grade math and debunk this leftist pipe-dream of an argument that has been around for decades.
Once again, I'm going to go with the most
EVIL
VILE
DISGUSTING
GREEDY
HORRIBLE
corporation that ever existed - Exxon Mobil.
Executive compensation, which is now required to be filed in the 10K/annual report to the SEC, can more easily be found on Morningstar which does a nice job of presenting it annually.
As you note, those evil, mean (and no doubt) 100% white male corporate executives at Exxon Mobil make on average $85 million annually in compensation.
Now, what if we were to take all of it and spread it fairly across all the "real" employees at Exxon Mobil? How much would it help those poor, disadvantaged near-slaves that are being taken advantage of by these evil executives?
Well a little google searching will find that Exxon Mobil employs 75,000 employees. You do a little 3rd grade math and you come to find out that if we stuck it to those evil, greedy (and don't forget White Male) capitalist pigs, each and EVERY employee would get a raise of (drum roll please!!!!)....
$1,133.
Giggity freaking giggity.
Now, let's do something I like to do to save time and advance the conversation along - predict the knee-jerk counterarguments from the left.
Did you include stock options? - Yes, the SEC considers stock options, grants, and other forms of non-cash compensation in it's calculations.
Well, that's just Exxon Mobil. It's probably worse at other companies! - Then you do something for the first time and research something rather than blather.
Still! That's better than nothing!!!! - Oh shut up.
The whole point is that this myth of if we "just took executive compensation and spread it across the employees, then everybody would have higher standards of living" is precisely that - a myth. The MATHEMATICAL REALITY IS that there just aren't enough executives out there. Yes, they make a lot of money, but given the ratio of employees to executives, it's too high to make this dream reality. Worse still for the left, this says nothing about their ultimate goal - taking executive compensation and giving it to EVERYBODY - employees, poor people welfare recipient, students, single mothers, etc. etc. If you included the millions of dependent parasitic classes, confiscating ALL of Exxon Mobil's executives' compensation would result in an increase of just PENNIES to the average democrat voter.
The truth is that relying on other people and pursuing a life of parasitism will NEVER get you to the standards of living you want. And wasting your life lobbying, debating, and arguing for other people's money is precious time that could be otherwise spent improving yourself, your skills and your own lot in life, much more so than waiting for the democrat party to eek out an added tax "on the rich."
So argue all you want.
Protest all you want.
Whine all you want.
Stammer your feet and pout.
Even if you got everything you wanted, your life would still suck because (and here's the sad truth) you suck.
So stop sucking at life and do something with it instead of sticking your hand out.
How about public employee executive compensation?
ReplyDeletehttp://transparentcalifornia.com/agencies/salaries/
This would also have another effect : executives would leave the company or, if every company had the same policy, it would demotivate executives to the point when they don't do anything productive, and profit would drop badly.
ReplyDeleteIf profit decreases, guess what the salary of "real workers" does (if they even can keep their job).
Since the left or right for that matter does not want to anything to abolish or substantially lower the tax burden, that $1,133 is really a lot less than that.
ReplyDeleteI still recall my first bonus over a decade ago where you are raped of almost half of it. No leftist whining about that for us peons.
@pantheon
ReplyDeleteIt can also be pointed out to union thugs that clearly displayed in the graph executive pay fluctuates unlike union workers that only want increasing wages. Company did well give us some of that. Company did poorly dont even think of taking anything away also give us more.
AmicusC
So whats your take on executive compensation in general? Spreading it around would be poison, but lets ask ourselves do they really deserve it?
ReplyDeleteHow much of American Airlines executive compensation comes from shrinking the legroom? Fifteen years in the tech industry has left me with the belief that a strong chunk of managerial compensation comes from screwing the customer. While it's fund to watch their sins catch up to them (my fav example is now DEAD!), it seems like a huge waste of resources.
Again, don't read me wrong: I'm not for spreading it around, but something does seem to be out of balance...especially when you look at their actual skill set and what they accomplish. If we engineers could play as fast and loose with the laws of physics as the upper echelons did with finances, we'd have teleportation and sex via replicator.
The other bit leftists are missing is that they have successfully skewed taxation up, that the government would lose a huge chuck of income tax revenue if these executives were to make a "normal" salary.
ReplyDeleteHere's some stats from 2010 I saved when I was researching (the horror!) tax burdens:
The top 0.2% ($1M/yr and up) of Federal Income Taxpayers earned 11.3% of the income, but paid 21.9% of the total income taxes collected by the Treasury.
The top 0.5% ($500K/yr and up, includes the top 0.2%) earned 16% of the income and paid 30.9% of the tax
The top 2.9% ($250K/yr and up, includes .5 and .2) earned 28% of the income and paid 50% of the tax.
The top 12.8% ($100K/yr and up, includes the above) earned 51% of the income and paid 74% of the tax.
So as of 2010, the top 13% of income earners in America are paying 3/4 of all Federal Income Tax revenue.
At every level, the rich are paying a greater share of the federal tax burden than they are receiving in income.
And yet, this it is argued that they are not paying their fair share.
I've been ruminating about this for a while Cap, and I think the idea of just giving it to the employees is a bit of a misdirection (although I'm sure the unions play that game).
ReplyDeleteMost executive pay I view as parasitical, just as I view most taxes that way.
I have observed plenty of games played by executives to justify huge bonuses and large salaries, while destroying the health of the company they run and they don't care.
We no longer live in a culture that rewards loyalty or expects it from the top or the bottom.
So if the salaries could have been used to improve the company through growth, innovation, improvements in quality, service or products, then that salary is wrong.
And no, I'm not advocating for hiring dead weight, but I am about expansion.
As for the reasoning that this "talent" will go somewhere else, that's the same kind of nonsense used to keep judges and politicians in office. The same nonsense used to justify large public employee salaries at the top.
We are filled with this kind of "talent" there's always another to take the place and the top is a very incestuous class.
I have pondered the corporation as a legal entity and organization for years and the more I've thought about the, more unholy I think that structure is. It is really isn't about the efficient use of resources, but a way of avoiding culpability.
Our social and economic structure has shifted dramatically with the growth of corporations and leftism and the two are very much connected to each other. Both are pillars of a society built to allow people to avoid personal responsibility for themselves and their impact on others.
Make no mistake, corporations are pro feminism, women are the biggest consumers and by pushing everything that ultimately makes women unhappy, they get more consumerism from women.
Now if we were talking about a business owned by a person that he built up and he was living large, I have nothing but admiration for him (if not necessarily his views or actions.), but this is almost entirely not the case anymore.
@Pantheon Dweller:
ReplyDeleteThat might be a relevant point if someone actually suggested to take away the entire salaries of executives, or reduce them to the levels of the other workers. I'm not aware of anyone actually advocating that. Capn just took their entire slice of the cake to get some ballpark numbers, which is entirely sufficient for a debate like this.
There is little reason to believe that current levels of executive compensation are the outcome of market forces. If one started from such a premise, one would have to conclude that executives are some extremely scarce, hardly replaceable and critical commodity, one that has become more of all those things in the last few decades, when executive salaries have risen way faster than either corp profits or the overall wage level.
Yet, every business school is full of wannabe executives, there's hardly any scarcity of them. Nor are they selected through some careful auditioning meant to get the best candidate for the job, nor their salaries determined either through candidates making competing bids for their services, nor is ever any attempt made to calculate the appropriate salary from the marginal benefit to the bottom line for the company from having the right guy at the job.
On the contrary, executive positions are more often than not awarded by insider corporate cultures, through patronage and being part of the right old boys' networks. Salaries are set by what's at the time considered a "typical" executive salary for the industry, which has caused salary creep as those paying below the average feel the pressure to pay more, pushing up the average on the way.
-Red Knight