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Originally Posted by Useless
Unfortunatelly, there IS a problem where CEO compensation is concerned.
Yes there are problems where CEO compensation is concerned. But not every CEO's compensation is a problem.
The CEO of a poorly led, poorly managed company of today makes more money than the CEO of a thriving successful company made ten years ago....
In far too many cases this is true. It is pathetic to reward so-called leaders of Fortune 500 companies (or any company) who poorly lead and poorly manage their business with astronomical compensation. It's wrong. However, I have no problem with rewarding CEO's who practice what they preach.
...Lee Iaccoaca, the living legend who drove Chrysler Corporation out of it's grave, only earned about $25 Million back in the mid 1980's. He also led by example; after discovering just how dismall Chrysler's situation was, during his first year with Chrysler, he cut his own salary to $1.00... that's right, ONE DAMMED DOLLAR!! He was not about to demand wage concessions from UAW without setting the examplr.
I was thinking precisely of Lee Ioccaca when I referred to the $1.00/year compensation of CEO's who choose to lead and manage in a respectable fashion.
Today, compensation packages are not tied to a company's performance, and the vast majority of CEO's and executive staff usually own very little, or even NO stock in the companies they are entrusted to lead. CEO compensations, of $25 Million are considerd paltry in todays world, and that includes poorly led companies.
Again, unfortunately true in many cases.
Now, if the CEO of a corporation does not have enough faith in the company he/she leads to purchase stock (....and I'm NOT talking about optopn packages that amount to legalized theft!!!) then why should anyone else have faith in a company?? When the going gets tough, when the difficult times are directly related to poor management and pathetic leadership, the CEO's pay still goes up. It's the rank and file, and mid level managers, and the stockholders who suffer the consequences.
'Tis true. It's also true that under good leadership and management, the rank and file and mid-level managers reap the rewards. It's also true that occassionally, good leadership and management will pull a colossal blunder that hurts everyone -- but that's the exception, not the rule.
Now, if you guys (and ladies) are out their busting your arses, paying for your company's CEO's lavish lifestyle, jet time, and company paid vacations through your hard work, longer hours, seeing your pay increases being eaten up by higher healthcare insurance, and your purchasing power eaten away through inflation, and stretched budgets, and you are okay with that, then keep driving and quit complaining. Vote Republican, and we'll carry on with business as usual.
Versus what? Quit driving and keep complaining?? Um...this is the 21st century. It has challenges that the 20th century didn't have. It has challenges that will probably pale in comparison to the challenges in the 22nd century. It's really short-sighted to blame the world's woes on CEO's and the Republicans. I bust my arse. I do contribute to a "lavish" lifestyle to the guy who owns the company I work for (he does what he wants and I do what I want). I do see pay increases eaten up by healthcare insurance, purchasing power eaten away through inflation, and yet I keep driving. And I'm part of the middle class. Sure there are problems. But I don't simply blame CEO's and Republicans for those problems. If anything I blame CEO's, Republicans, Democrats, Independents, you, me, etc. In other words, all of us carry a little bit of the blame for allowing, for example, the marketplace to pay astronomical compensations plans to poor leaders/managers of public/private companies. Let's face it, most of pay lip service to what needs to be changed but do very little anything about it. Unlike our ancestors who had the kahonas to enact a little thing called the American Revolution. I've traveled to parts of this world and although some may find it difficult to believe, I'd rather live in the United States with all of its challenges (including outrageous taxes) than anywhere else in the world.
Another problem is that this mismanagement makes competing on an even keel, and being able to provide proper compensation packages to managers and nonmanagement workers increasingly difficult for people in my position.
Yep -- life is unfair.
For example, look at Southwest Airlines... they strive to "play by the rules" and remain finacially strong through inspired leadership, sound manangement, and financial discipline, while their competitors fly under the safety of a Chapter 11 Bankruptcy umberella. The end result?? The cards are stacked against them, and out tax structure penalizes them.
But don't you admire the CEO's, mid-level managers and rank and file workers for trying their best to challenge and change the system?! Good for them!
True, life is not "fair", but since the post WWII Era, a strong, thriving middle class has been the backbone of our economic strength, and the strength of that backbone is being weakened through economic policies that threaten the American Middle Class.
Thank God for the middle class. A curse against all government officials and loser CEO's (who haven't a clue how to appropriately lead and manage both people and business) who mess with the middle class.
Henry Ford knew what he was doing when he created the Five Dollar A Day Worker. The problem is that unions became corrupt through their leadership, and workers started demanding to share in wealth that ssimply was not being produced. Now, we see those same things happening in America's corporate ivory towers.
"Power tends to corrupt, and absolute power corrupts absolutely." - John Acton
What Ronald Reagan envisioned as "trickle-down" economics" has turned into "vaccuum cleaner economics". (BTW, I voted for Reagan twice!!) IMHO, we neede to reform our tax structure in such a way that we reward good performance, and penalize poor performance....
Amen!
...This reform should include revisions in our tax structure which would lessen the tax burdens upon companies that strive to provide proper and more equitable compensation for their employees, while penalizing companies and corporate leaders who line their own pockets, all while picking the pockets of their employees, shipping jobs overseas, and doing little or nothing for the stockholders who actually own the company.
I wholeheartily agree. Sometimes, however, good companies and good CEO's have little choice but to ship some/most jobs overseas to remain competitive and profitable (certainly doesn't apply to all companies and CEOs!). Furthermore, let's not be too hasty to say that jobs that have gone overseas will never return. The 21st century global enconomy means that jobs will cycle through various countries when the economic conditions are favorable to do so.
I would encourage everyone to start reading the writtings of Lou Dobbs.
Please provide a web link or two.
BTW, I AM speaking as a CEO, and I am also an active investor. While things are relatively good for us overall, believe me, we ARE taking our hits in the market place..... but I'm not demanding that my people take their hits, and mine as well.[/color]
Useless, that's great! I have a tremendous amount of respect for CEO's!
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