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Bass 
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Posted on: Dec. 12 2012, 6:59 pm |
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McDonalds Worker and CEO Pay
From the article:
The pay gap between the average S&P 500 CEO and the average U.S. worker, which was 42 times in 1980, widened to 380 times in 2011 from 325 times in 2010.......
The US is becoming a two tier society, with the very rich and the very poor - and a rapidly shrinking middle class.
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Ben2World
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Posted on: Dec. 12 2012, 7:16 pm |
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Is it because far fewer Chinese can yet compete as captains of world-class corporations -- whereas far more Chinese can compete in sewing, shoemaking, and electronics assembly?
So what to do?
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The world is a book and those who do not travel read only a page. -- St. Augustine
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Montecresto
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Posted on: Dec. 12 2012, 7:25 pm |
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It's because of the attack on unions. Far fewer people are represented by a union now than in 1980. 30 years of Reaganomics that didn't trickle down. A deregulation of so many things implemented by the Roosevelt administration that protected the workers. It all grew a strong middle class typically with single income families and a comfortable retirement was a given. That was the 50's, 60's, 70's.
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Killing one person is murder, killing a 100,000 is foreign policy
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hbfa
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Posted on: Dec. 12 2012, 9:02 pm |
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"The recovery from the last downturn has been the most uneven in recent history. The 1.2 million households whose incomes put them in the top 1 percent of the U.S. saw their earnings increase 5.5 percent last year"
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Montanalonewolf
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Posted on: Dec. 13 2012, 9:16 am |
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What percentage of a company's production workers have the ability to perform their CEO's job?
In the real world, virtually none of the production workers will have that ability and/or capability and very few of the front office staff.
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Ignorance is curable with education. Stupidity is refusing to be educated.
Those who don't read have no advantage over those who can't.
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Land Rover
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Posted on: Dec. 13 2012, 9:29 am |
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(KenV @ Dec. 12 2012, 10:48 pm)
QUOTE
(Bass @ Dec. 12 2012, 6:59 pm)
QUOTE McDonalds Worker and CEO PayFrom the article: The pay gap between the average S&P 500 CEO and the average U.S. worker, which was 42 times in 1980, widened to 380 times in 2011 from 325 times in 2010.......The US is becoming a two tier society, with the very rich and the very poor - and a rapidly shrinking middle class. I'll grant that CEO pay is often excessive and they are often "very rich". I will also grant that CEO pay has risen MUCH faster and higher than the average worker's salary. But CEO's are a very small group. Is comparing that small group's pay with the pay of the "average worker" at all meaningful? Would comparing the pay of the "average motion picture industry worker" with the pay of movie stars be meaningful? Would comparing the pay of the "average roadie" with the pay of music stars be meaningful? In any event, the statement "The US is becoming a two tier society, with the very rich and the very poor" begs a question. If CEO's are "very rich", are average workers "very poor"? I think not.
Ken the entire point of this thread is that a tiny number of people are getting excessively rewarded. It appears to pass you by.
And it depends what you mean by very poor. As the richest nation on earth we can for the most part feed ourselves, though millions of children do go hungry at times.
The imbalance in incomes is also crushing all that is America as it comes with a lack of social mobility which is now being perpetuated through generations.
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hikerjer
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Posted on: Dec. 13 2012, 3:21 pm |
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Why this trend? Simple. It's called greed.
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"Too often I have met men who speak only of how many miles they've traveled and not of what they've seen." - Louis L'Amour
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TehipiteTom
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Posted on: Dec. 13 2012, 5:20 pm |
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Globalization is part of the story, and so is the decline of unions, but there's more to it.
Two related factors are more important here: the financialization of the economy, and the rise of "shareholder value" as the dominant ideology in corporate America.
The financial sector has grown explosively over the last 30 years, to the point that it currently represents 8% of total GDP and ~35% of total domestic profit. While the financial sector has an essential function in making capital available to businesses and individuals who need it, over the last 30 years the massed ingenuity of the sector has been devoted entirely to finding new ways to siphon more profit out of the system. This economic vampirism has been sucking more and more money out of the productive economy and into speculation.
And the thing is, if you back up and look at the big picture, the whole job of the financial services industry is funneling more money to people who already have it. Growth in that sector (beyond what is actually needed to keep the productive economy going) inherently redistributes wealth upwards.
The other part is the cult of "shareholder value", which holds that the ultimate purpose of any company is to funnel money to its investors. The long-term good of the company itself is a consideration only in so far as that aligns with more cash for the shareholders. Under the "shareholder value" model, good wages (which can be in the long-term interest of a company, attracting better and more loyal workers) are an inefficiency; the shareholder value imperative dictates that wages for any but the top executives must be kept at the absolute minimum practicable level.
(Top executives, of course, are exempt from this; they're "worth" whatever they're paid as long as they keep the cash flowing to the investors. That's the carrot in the "shareholder value" enforcement scheme. The stick is the prospect of hostile takeover.)
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If tautologies are outlawed, only outlaws will use tautologies.
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Bass
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Posted on: Dec. 13 2012, 8:07 pm |
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(TehipiteTom @ Dec. 13 2012, 4:20 pm)
QUOTE Globalization is part of the story, and so is the decline of unions, but there's more to it.
Two related factors are more important here: the financialization of the economy, and the rise of "shareholder value" as the dominant ideology in corporate America.
The financial sector has grown explosively over the last 30 years, to the point that it currently represents 8% of total GDP and ~35% of total domestic profit. While the financial sector has an essential function in making capital available to businesses and individuals who need it, over the last 30 years the massed ingenuity of the sector has been devoted entirely to finding new ways to siphon more profit out of the system. This economic vampirism has been sucking more and more money out of the productive economy and into speculation.
And the thing is, if you back up and look at the big picture, the whole job of the financial services industry is funneling more money to people who already have it. Growth in that sector (beyond what is actually needed to keep the productive economy going) inherently redistributes wealth upwards.
The other part is the cult of "shareholder value", which holds that the ultimate purpose of any company is to funnel money to its investors. The long-term good of the company itself is a consideration only in so far as that aligns with more cash for the shareholders. Under the "shareholder value" model, good wages (which can be in the long-term interest of a company, attracting better and more loyal workers) are an inefficiency; the shareholder value imperative dictates that wages for any but the top executives must be kept at the absolute minimum practicable level.
(Top executives, of course, are exempt from this; they're "worth" whatever they're paid as long as they keep the cash flowing to the investors. That's the carrot in the "shareholder value" enforcement scheme. The stick is the prospect of hostile takeover.)
+1
I would add that the financial sector has been sucking more and more of the profits from middle class IRA's and 401K's - to the point that such investments available to the middle class have not been producing a return in the last 10 to 12 years. But the rich have been doing very well since their investments are not loaded with as many fees and expenses.
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Ben2World
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Posted on: Dec. 13 2012, 8:20 pm |
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Indeed, one major shortcoming of capitalism (on which our economic and financial systems are largely built) is its inability to factor in long term costs and benefits effectively. And we see the results.
But be mindful of "cures" that may turn out far worse than the disease. Communism was at heart an honest attempt (at least initially) of curing the ills of capitalism!
No one has the answer yet. But I put little faith in protectionism. Too many other countries have tried it and failed. Is this going to be yet another episode of "American exceptionism" -- following the mold of our recent ventures in Afghanistan and Iraq -- that we will succeed because we are Americans?
I really, really hope not. Because we have failed too many times on the heels of those who failed before us... because too many of us refuse to learn from the experiences of others.
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The world is a book and those who do not travel read only a page. -- St. Augustine
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KenV
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Posted on: Dec. 13 2012, 9:01 pm |
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(Land Rover @ Dec. 13 2012, 9:29 am)
QUOTE Ken the entire point of this thread is that a tiny number of people are getting excessively rewarded. It appears to pass you by.
Pass me by? Please. Look closer. There is a growing number of "tiny" groups that are getting "excessively rewarded." CEOs are just a handy scape goat.
What groups? CEOs. Football coaches. Movie stars. Movie directors. Movie producers. Music stars. TV stars. Sports stars. Entrepeneurs. The list is regrettably long. As someone
Interestingly, in almost all cases the "excessively rewarded" folks make possible the jobs of hundreds or even thousands of workers.
But the real crux of the supposed "problem" is, "What is the solution?" Any laws that outlaw "excessive pay" would not only be the death knell of the free market, but the death knell of the constitution. Simply saying "You didn't build that." solves nothing.
QUOTE And it depends what you mean by very poor. Indeed. But that was NOT my term. Ask Bass what he meant.
Nevertheless, in my opinion, the "very poor" are those who fall well below the poverty line. Does the "average worker" fall into that group? Clearly not. So why is "the very rich" vs "the very poor" supposedly synonyous with "CEOs" vs "average workers". It's an utterly false equivalence.
QUOTE The imbalance in incomes is also crushing all that is America.... I'm doubtful the "imbalance" is as severe as you claim, much less that it is "crushing" America. This appears to be hyperbole, like the equivalence described above.
QUOTE ...as it comes with a lack of social mobility which is now being perpetuated through generations. Yes, we do have a problem with social mobility. But I wonder if that is an economic opportunity problem or a social problem. Since "The Great Society" and the "War on Poverty" large numbers of kids have grown up in families largely or entirely dependent on the government. They grew up literally addicted to the government teat. These kids have become dependent adults who beget more kids who become addicted to the teat. The problem is clearly NOT one of opportunity. Millions still come here from all over the world precisely because this nation provides more opportunity than any other. The problem appears to be social in that we as a society for whatever reason, have decided to permit unlimited dependency. The Rs claim this has happened because dependent people vote democrat, so the democrats encourage dependency. Undoubtedly there's some truth to that, but I'm sure the full truth is much more complex.
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KenV
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Posted on: Dec. 13 2012, 9:10 pm |
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(hbfa @ Dec. 13 2012, 3:17 pm)
QUOTE The point, (to me at least) is the distance between the haves and the have-nots has been steadily widening.
Aaaah, but is it? Are there really many "have nots" in America? Or do you really mean "have not as much"? This sounds increasingly like envy, not need. Things that for generations were undreamed of luxuries have become "necessities" that the government gives away. Like free cell phones, inaccurately called "Obama phones."
QUOTE You may be fine with this trend, I think it's not in the best interest of our nation as a whole. I'm NOT fine with it. I'm just convinced that the supposed "cure" is far worse than the disease. Like "closed shops" that give so much power to a union that they literally have the ability to destroy a company or even a significant portion of an entire industry. I believe THAT is "not in the best interest of our nation as a whole."
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KenV
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Posted on: Dec. 13 2012, 9:41 pm |
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(Bass @ Dec. 13 2012, 8:07 pm)
QUOTE I would add that the financial sector has been sucking more and more of the profits from middle class IRA's and 401K's - to the point that such investments available to the middle class have not been producing a return in the last 10 to 12 years.
What an absolute load of crap. I'm firmly in the middle class and last year alone my 401K based IRA earned 17%. I paid Prudential 1% off the top to earn that. Literally ANYone with more than five grand to invest can earn what I earned and would have to pay what I paid. And tens of thousands have. To say that is not a "middle class" investment is beyond ludicrous.
QUOTE But the rich have been doing very well since their investments are not loaded with as many fees and expenses. Yet more crap. The rich pay more fees than I do simply because they get a higher level of service. This may come as a shock, but you (generally) get what you pay for.
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Land Rover
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Posted on: Dec. 13 2012, 9:56 pm |
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(KenV @ Dec. 13 2012, 9:41 pm)
QUOTE
(Bass @ Dec. 13 2012, 8:07 pm)
QUOTE I would add that the financial sector has been sucking more and more of the profits from middle class IRA's and 401K's - to the point that such investments available to the middle class have not been producing a return in the last 10 to 12 years. What an absolute load of crap. I'm firmly in the middle class and last year alone my 401K based IRA earned 17%. I paid Prudential 1% off the top to earn that. Literally ANYone with more than five grand to invest can earn what I earned and would have to pay what I paid. And tens of thousands have. To say that is not a "middle class" investment is beyond ludicrous. QUOTE But the rich have been doing very well since their investments are not loaded with as many fees and expenses. Yet more crap. The rich pay more fees than I do simply because they get a higher level of service. This may come as a shock, but you (generally) get what you pay for.
How did it do in the preceding three years Ken?
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Land Rover
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Posted on: Dec. 13 2012, 9:59 pm |
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(KenV @ Dec. 13 2012, 9:10 pm)
QUOTE
(hbfa @ Dec. 13 2012, 3:17 pm)
QUOTE The point, (to me at least) is the distance between the haves and the have-nots has been steadily widening. Aaaah, but is it? Are there really many "have nots" in America? Or do you really mean "have not as much"? This sounds increasingly like envy, not need. Things that for generations were undreamed of luxuries have become "necessities" that the government gives away. Like free cell phones, inaccurately called "Obama phones." QUOTE You may be fine with this trend, I think it's not in the best interest of our nation as a whole. I'm NOT fine with it. I'm just convinced that the supposed "cure" is far worse than the disease. Like "closed shops" that give so much power to a union that they literally have the ability to destroy a company or even a significant portion of an entire industry. I believe THAT is "not in the best interest of our nation as a whole."
Ken. Try to deal with real facts here Ken. The gap is widening. The fact that you imagine you see people who you determine as poor with a cell phone is a crap substitute for real information.
Did you accept anecdote substituted for facts in your professional life Ken. If not then why do you feel it's ok to wheel it out here.
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Land Rover
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Posted on: Dec. 13 2012, 10:15 pm |
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The bottom line here ken is that averages incomes are not going up while profits are. You may trot out the BS about envy, but it doesn't fly outside the little fantasy world most conservatives seem to live in.
In an ideal world for a CEO they get to cut (or not increase) their employees' wages while everyone else's remain high enough to enable them to consume more and more product. But when this trend is embraced by an economy as a whole it's going to lead to the failure of a nation.
Your 401k doing well is a reflection of corporate success in a large part. This is not being transferred to increased average incomes.
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wwwest
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Posted on: Dec. 13 2012, 10:15 pm |
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Starving kids in Africa have cell phones, but they can't eat them.
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hbfa
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Posted on: Dec. 13 2012, 10:34 pm |
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(KenV @ Dec. 13 2012, 6:10 pm)
QUOTE
(hbfa @ Dec. 13 2012, 3:17 pm)
QUOTE The point, (to me at least) is the distance between the haves and the have-nots has been steadily widening. Aaaah, but is it? Are there really many "have nots" in America? Or do you really mean "have not as much"? This sounds increasingly like envy, not need...
I'm not interested in quibbling over the defintion of "have nots"
but CEO pay continues to rise to astronomical heights while the poverty rate also continues to rise.
You can call it whatever you like.
But there is a trend of growing disparity in our nation and that does not bode well for the future.
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Land Rover
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Posted on: Dec. 13 2012, 10:54 pm |
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There seems to be some trouble from those on the right in accepting that a cell phone is cheaper and easier to get than a land line and is a basic form of modern communication.
Btw - It's also not that easy to buy anything but a flat screen tv any more and major manufacturers are giving up making them because they are so cheap.
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TehipiteTom
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Posted on: Dec. 13 2012, 11:13 pm |
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(Ben2World @ Dec. 13 2012, 5:20 pm)
QUOTE But be mindful of "cures" that may turn out far worse than the disease. Communism was at heart an honest attempt (at least initially) of curing the ills of capitalism!
You're so right. I totally retract my suggestion that we try communism...hey, waittaminnit! I didn't suggest that at all! What the....?
QUOTE No one has the answer yet. But I put little faith in protectionism. Too many other countries have tried it and failed.
Dang, you got me again. You're right Ben, my support for protectionism was totally...hey, w'huh? I never supported protectionism! Damn you Ben, you're just too devious for me!
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If tautologies are outlawed, only outlaws will use tautologies.
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Ben2World
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Posted on: Dec. 13 2012, 11:35 pm |
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(TehipiteTom @ Dec. 13 2012, 8:13 pm)
QUOTE
(Ben2World @ Dec. 13 2012, 5:20 pm)
QUOTE But be mindful of "cures" that may turn out far worse than the disease. Communism was at heart an honest attempt (at least initially) of curing the ills of capitalism! You're so right. I totally retract my suggestion that we try communism...hey, waittaminnit! I didn't suggest that at all! What the....? QUOTE No one has the answer yet. But I put little faith in protectionism. Too many other countries have tried it and failed. Dang, you got me again. You're right Ben, my support for protectionism was totally...hey, w'huh? I never supported protectionism! Damn you Ben, you're just too devious for me!
I wasn't responding to your posts at all. Nevertheless, it's good that you see the errors of your ways. 
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The world is a book and those who do not travel read only a page. -- St. Augustine
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Land Rover
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Posted on: Dec. 14 2012, 8:34 am |
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It's quite funny watching you try to pitch the automatic alternatives to your ideas as communism and protectionism though Ben. What do they call it when someone introduces an idea that no one else had raised in order to knock it down?
Ken - its fun to watch you ticking off the talking points.
First we get the denial. Not really a problem, no real poverty, they have cell phones you know. Of course there's mobility. Look at these anecdotal examples of people who have made it. That overwhelms the stats that say otherwise.
You even managed to get the explanation of why we are even bringing up the wealth gap. Envy. Sure you'll be describing it as class warfare.
You accept a lack of social mobility is a problem, then try to change what it means
It's a prime example of why your ideas are such abject failures that lead to collapse when they are applied. When confronted with real issues all we get from conservatives is denial and excuse.
Stagnant wages, a lack of social (and economic) mobility, and a widening wealth gaps are Real and tangible problems facing America that need addressing for us to continue to succeed.
Moaning about what we do already and living in an utter state of denial about the challenges we face is not going to work.
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Montecresto
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Posted on: Dec. 14 2012, 9:07 am |
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(KenV @ Dec. 12 2012, 10:55 pm)
QUOTE
(Montecresto @ Dec. 12 2012, 7:25 pm)
QUOTE It's because of the attack on unions. Far fewer people are represented by a union now than in 1980. 30 years of Reaganomics that didn't trickle down. A deregulation of so many things implemented by the Roosevelt administration that protected the workers. It all grew a strong middle class typically with single income families and a comfortable retirement was a given. That was the 50's, 60's, 70's. Reaganomics killed the unions? Or out of control unions killed the unions? Separately, a quick comment on your sig line: "Killing one person is murder, killing a 100,000 is foreign policy." Was killing Osama Bin Laden murder? Or foreign policy? How about assassinating individual Al queda leaders using drones?
Was OBL killed again? Reagan didn't believe in workers rights. Do you know what condition the work place was like before democrats intervened? What about the New Deal, that wasn't republican born. Why any low on the totem pole vote against their own interests (vote republican) is?
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Killing one person is murder, killing a 100,000 is foreign policy
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