On Labor Day we customarily give a nod to America's underpaid and overworked blue and pink collar workers -- janitors, flight attendants, forklift operators and the like. But this year, let's go a step further and salute the most reviled and despised of the people who make our economy happen, the mere mention of whom causes the average forklift operator to spit on the floor. You are thinking perhaps of telemarketers, human traffickers, and the fiends who answer the phone when you to try to make a claim on your health insurance. But I'm talking about our CEOs.
Just in time for the holiday, two liberal groups -- United for a Fair Economy and the Institute for Policy Studies -- have issued a gleefully malicious new attack on our CEO class. They point out that the CEOs of large companies earn an average of $10.8 million a year, which is 362 times as much as the average American worker, and retire with $10.1 million in their special, exclusive CEO pension funds. They further point out that the compensation of U.S. CEOs wildly exceeds that of their European counterparts, who, we are invited to believe, work equally hard.
And, in what they must think is their cleverest point of all, the UFE/IPS folks state that: "The 20 highest-paid individuals at publicly traded corporations last year took home, on average, $36.4 million. That's...204 times more than the 20 highest-paid generals in the U.S. military." You know what we're supposed to think here: Wow, but generals have all that responsibility! They're responsible for national security, or at least for conducting the wars that increase the threats to our national security and thus help justify ever greater increases in our national security apparatus!
But someone has to speak up for our beleaguered CEO class, and let me begin with that spurious comparison to the top military brass. Could we put patriotic emotion aside for a moment and look at this in a hard-headed, bottom-line, sort of way?
Suppose you are the general responsible for all the service people currently in Iraq, about 130,000 in round numbers, and suppose you manage to lose every single one of them in some ghastly miscalculation. With the death benefit for the family of a dead soldier running at $100,000, your mistake will cost a total of $13 billion. Sounds like a lot, I know, until you consider that a hedge fund manager or financial company CEO can lose that much in a single afternoon, without anyone even noticing. Q.E.D., there is simply no comparison between a general and a CEO.
That's a side issue, though. The real point, which the CEOs and their usual defenders are strangely reticent about making, is that it's damn expensive to be rich, and extravagantly expensive to be super-rich. Before you start playing your air violins, consider the costs of maintaining up to five different homes, some of them up to 45,000-square-feet in size, most with swimming pools, tennis courts, guest houses, and wine cellars requiring constant supervision.
The poor whine about having no home at all, or maybe a two-bedroom apartment for a family of six. They should just think for one moment of the tribulations involved in running four or more mansions, each with its own full-time staff. There's the problem of getting between them, for example. A friend of mine, of very modest means himself, consults for a billionaire couple who commute between London and Los Angeles by private jet, with their dogs following in a second private jet.
But much of what we know about the extreme costs of wealth comes from Wall Street Journal columnist Robert Frank's recent book Richistan. The ultra-rich, who are drawn largely from the CEO class, require staffs of about 40-50 people, including not only cooks, maids and nannies, but "lifestyle managers" (to set up the entertainment schedule) and -- in a throw-back to the original gilded age -- butlers. It's the butler's job, among other things, to deal with any issues that may arise from the proliferation of homes. For example, if the boss is in Palm Beach, Frank reports, "and wants to send his jet to New York to pick up a Chateau LaTour from his South Hampton cellar, the butler makes it happen, no questions asked."
Nor are the ultra-rich in a position to cut back on their expenses -- by, say, running down to the supermarket for a $12 bottle of chardonnay. If they were to do so, their friends would despise them. As Frank explains, the Richistani word "affluent," meaning someone with less than $10 million in assets, translates into English roughly as "scum."
A mean-spirited critic of the ultra-rich CEO class might grumble that the rich should simply find a new circle of friends. But who exactly might these new friends be? If you were in the $100-million-in-assets set, you could hardly consort with the class of people for whom a pittance like $10,000 might be a transformative sum, possibly allowing granny to get her insulin and the children to have warm winter clothes. People of that class could not be trusted not to pocket the silverware or rip out the gold fixtures in your powder room. They might even make a lunge for your throat.
Barbara Ehrenreich admits to being on the board of the Institute for Policy Studies.
It's almost enough to make one say to hell with it, and become a self-employed upholsterer.....
If the CEO of Ford Motor Co. was truly earning his pay, I wouldn't have been driving a GERMAN MADE diesel VW for these past 26 years! It gets 50 miles per gallon, costs about $1,000. per year to service, and goes to 300,000. miles before replacement is needed; and there's the crux of the situation! ( lower sales!)
It doesn't seem to bother VW though! They just opened a manufacturing plant in SAUDI ARABIA!
Why are the Saudis ( who are) sitting on all that oil, not driving Fords at 12? 15? 20 mi per gal?
VW took the ORIGINAL FORD mission statement: to produce a well functioning car in an affordable price range, to the average Joe. Ford lost it!
We should all copy that quote from Abe Lincoln, and send it into the White House! Maybe then Dubya would stop comparing himself to "Honest Abe".
Great article Barbara!
what would america be without these folks.
capitalism is designed by its very nature to benefit the few unless of course you believe in the trickle down theory.
love it a country that has ceo's getting rich off the sick and needy and wars for profits.
yes indeed let us make war on nations to give them our form of democracy. hint the greatest of cons to get that oil. and best of all most americans actually bought it like they did in vietnam when we said we better stop the commies over there so we do not have to fight them here. god i love americans so naive and self rightous. let the oil flow baby. $$$$$
wars for profits baby and so what if we kill a few hundred thousand iraqis.they are not even christian. besides watching them die on tv is like watching an action movie. no affect on me baby i am a chickenhawk sitting on my lazy boy drinking my expensive wine and my kids are safe in an elitist college.
god i love imperialism and the slaughter it brings to others. blood for oil baby the american way. what is a little nonchristian blood for all that oil.
signed
just one proud american neo con ceo from a red state
If he increased value for the company, and made work better for the people that make the money...it might be justified.
The contrary is the case.
Scott became CEO in 2000, and the stock was valued near $60. Today, it is hovering just above $43.
If any of us underlings lost 30% of our business, we would be kicked to the curb.
Scott is a bad investment in a notoriously bad company
YOU CAN STOP NOW OR READ ON
MY FATHER was one and later I was one the only thing was you had to be in a UNION, yes I know the people who make prises high ( A LIE )
GROWING up I was a
TRUCK DRIVER ( NONE UNION )
I PUT TOGATHER STOVES ( NONE UNION )
I MADE AROUND $1.25 AN HOUR ( 1958,59,60.)
MY FATHER was a " FUR MAN " WORKED IN FURS.
ONE day he asked if I wanted to work in the field " YOULL MAKE A GOOD DOLLAR "
SO I went to the union hall ( 105 W. 36 ST. N.Y.C. GAVE ME A CARD "DELIVERY MAN"
DIDN'T tell me what the pay was went to work did deliverys in the FUR MARKET OF N.Y.
( WALKED EVERY)
AT the end of the week I recived my pay check
FIRTY HOUR WEEK I HAD TO LOOK THREE TIMES
$560.00 LESS TAXES, MEDICAL, ETC. A DELIVERY MAN
20 YEARS OLD GETING $ 16,00 AND HOUR.
FOUR MAN WORK SHOP BOSE WORED BESIDE US TREATED ME AS A WORKER, FRIEND.
NEVER COMPLAINED ABOUT THE WAGES HE PAIED HIS WORKERS WE WORKED, HE MADE A LIVING AND A PROFIT.
AND THERE WAS THOUSANDS US AND OWNER WHO MADE A LIVING NO GREED, NO ITS ALL MINE ,YOUR JUST THE WORKER.
IN 1980 THE PRESIDENT BROKE THE
" AIR TRAFFIC UNION " AND IT WAS DOWN HILL AFTER THAT.
TO DAY THERE IS NO MIDDLE CLASS MY SON IN LAW SAYS HE IS THE MIDDLE CLASS HE MAKES OVER $450,000 A YEAR YOU CONSIDER YOURSLEF MIDDLE CLASS.
TILL THE DAY I DIE I WILL RECIVE A CHECK FROM MY UNION FOR $1,700.00 A MONTH AND I RECIVE MY SS CHECK I WILL BE COMFOTABLE TILL.
WHO WILL PAY YOU LATER A LOWED PAID ILIGAL .
UNIONS WEREN'T BAD THEY WERE FAIR THEY BUILT THE HOMES WE LIVED IN DROVE THE FOOD WE EATE, ETC. WE WERE AMERICANS BUYING AMERICAN.
In Lincoln's day, a few brakes were put on greed because people believed God didn't like it. Today, greed is even applauded by churches. Boy are they way way off, makes one fear for them.
Quite simply, you rock.
Sue would have typed this herself if her fingers didn't need a rest and a coat of Chanel varnish.
xoxo
Sue
http://suedoenim.blogspot.com
(as dictated to her evening butler)
A few years ago Mattel had a CEO that was so bad they basically paid her $14 million just to make her go away.
On a "similar but different" level,
Didn't they pay Mariah Carey something like $30 MILLION to do the same?
Good work, if you can....LIVE WITH YOURSELF!
(What do I know?)
Thanks, Major.
Huffpo typically is an oasis of sanity and clear thinking on the issues that matter and I am an everyday reader. But this thread gets right to the heart of what is wrong with America today.
The death of modern capitalism. Fucking mind BLOWING! Did we really think it was anything other than the human element that brought down modern communism? Capitalism as an alternative, is also doomed to failure at the hands of human nature. Both these political systems were viable in theory. Neither was inherently evil. Both will fail because they couldn't legislate around GREED, HIPPOCRISY, LUST, FEAR.
Ancient Chinese proverb (or at least a fortune cookie): "May you live in interesting times"