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GoPro's CEO Is Highest Paid Executive In America
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Zarathustra[H]
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We haven't had this balance since the 70s. Gradually since then, bought and paid for politicians have worked in loopholes year after year to benefit the super wealthy at the expense of the poor.
Because of this the income gap has and continues to grow placing more money in the pockets of those who are working on buying their 7th yacht, and less in the pockets of those who are struggling and working three jobs just to feed clothe and house their families.
It is a shameful situation.
Money has too much power in U.S. politics, and money will never cede that power voluntarily.
It seems inevitable to me that at some point the poor and middle classes will cease seeing themselves as - in John Steinbecks words - "temporarily embarrassed millionaires" and instead realize that there is no such thing as opportunity in America, unless you are born into wealth, and absolutely 0 chance of upward mobility. When this finally happens, watch out. There will be rioting in the streets and possibly armed revolt.
kbrickley
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Zarathustra[H];1041554647 said:
Unless the government totally runs out of money I don't see that happening ... both the poor and wealthy have lots of benefits in the USA ... it is the rapidly dwindling middle class that is actually feeling the squeeze ... the wealthy gets lot of benefits (as you noted) but so do the poor who can receive various assistance to offset their plight (and some poor have turned this into a generational legacy), and it is the middle class who are forced to work harder and pay more taxes to support the government and the other groups
it will only be if conservatives cut off social programs like welfare, food stamps, medical assistance, and housing assistance or abandon programs like social security and medicare that the fecal matter will strike the circulating cooling apparatus ... so far the government has been able to squeeze enough out the middle class where they haven't had to make the hard decisions yet ... not sure how long this can continue ... I do think that we need some out of the box thinking to solve this though and it isn't just more taxes to address this
So the CEO works ten times harder than the average employee. GREAT! If the average employee makes $40K a year, then pay the CEO $400K a year in total compensation. Not $130 million. Do you get that? And when you do a really shitty job and get shit canned because of that, you don't get any compensation. But in the buddy-buddy system, they don't even assume any risk for that tremendous reward, and are often asked politely to voluntarily step down in exchange for a $20 million golden parachute in spite of miserable failure.
And you realize that the inverse is true. The livelihood of the CEO is the responsibility of the employees beneath him that are actually DOING THE WORK for the company. Without the workforce, the CEO is worthless. Building the pyramids in Egypt required a CEO like oversight, but to pretend that the CEO built the pyramids... give me a break. He didn't touch one stone and just thinking of how to do it doesn't get the job done, and the people breaking their backs and suffering injuries and spending their lifetimes carrying out the plan reasonably deserve the credit and reward of building that pyramid, and not giving this pretense that it was all thanks to the guy who delegated the responsibility of management below him to direct its construction.
As that is essentially what CEOs do, as very few have any knowledge whatsoever of the business they are in. You can take a CEO that is responsible for making luxury sports cars and put him in position to run an animation company. For the most part their skillset is just how to best delegate work to a branch of lower management that are slightly more knowledgeable who in turn delegate to people beneath them with more and more specialized technical knowledge of the product delivery. That's why as you go up, they tend to be more and more clueless about the business, but more and more in tune with "people skills" in directing who does what and making very general broad stroke financial and directional decisions.
Isn't that kind of exactly what they've been trying to do?kbrickley said:
At the Mondragon corporation I mentioned earlier (where all employees have a say on compensation), they've agreed that the highest paid position is nor more than 6.5x times the lowest paid one. In another thread I saw someone say in the military a top general is paid 7x what a private is. These sound more like ratios everyone finds to be fair. What we have in most corporations is closer to feudal levels of distribution.
Arcygenical
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I know many CEO's of large companies, and they all pretty much do more work than anyone I've ever met. Multiple failed marriages, children that hate them, cars they own but have never driven, months away from home on average every year, alcoholism etc are the norm for them.
Granted, they're well compensated, but they have lives so different from the norm, that the lifestyle choices we make are foreign to them. From an outside perspective, it seems lavish, but it's not necessarily so. Getting an assistant to get you coffee sounds amazing to you or I, but if it's simply because your 16 hour workday, or 7 hour long conference call to a different fucking time zone, half a day outside your own (aka in the middle of your circadian sleep rhythm) just doesn't allow that time.
I know for a fact that Leslie Moonves of CBS spent 41 weeks away from home in 2006 or 2007. That's fucking incredible, and not a lifestyle I'd want, by any means, for any amount of compensation. I didn't see my dad for well over 3 years at the end of his career there.
This isn't the absolute rule, but it really seems to be the dominant one.
Granted, they're well compensated, but they have lives so different from the norm, that the lifestyle choices we make are foreign to them. From an outside perspective, it seems lavish, but it's not necessarily so. Getting an assistant to get you coffee sounds amazing to you or I, but if it's simply because your 16 hour workday, or 7 hour long conference call to a different fucking time zone, half a day outside your own (aka in the middle of your circadian sleep rhythm) just doesn't allow that time.
I know for a fact that Leslie Moonves of CBS spent 41 weeks away from home in 2006 or 2007. That's fucking incredible, and not a lifestyle I'd want, by any means, for any amount of compensation. I didn't see my dad for well over 3 years at the end of his career there.
This isn't the absolute rule, but it really seems to be the dominant one.
FearTheCow
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The "a ceo doesn't do x amount of work so shouldn't be paid y amount" is fucking stupid and shows a complete inability to think about why a CEO would be paid what they do. A CEO is directly responsible for guiding a business, a person putting plastic doohickey A into widget B does not dictate in what direction a business moves or how much it makes. So why the hell should the person who is easily replaced have a say in how a business operates or get paid more than their skill level dictates.
and yet, so many run their companies into the ground, stealing pensions of their workers, while hiding away millions in foreign bank accounts for themselves. Yeah, stealing all that money is hard work. Right now I'm about to have to get a lawyer involved because the company I'm retiring from is hedging on paying me my left over vacation time (one reason I'm leaving is because they kept denying my requests for vacation, then zeroing out our vacation accruals every fiscal year, essentially stealing from the employees part of our compensation package). The previous CEO left while collecting his bonuses, of course. Pretty much everyone I know, knows someone else who has gone through this absurdity, and it all starts from the top. I have absolutely no doubt that the CEO's know that the management is cheating the employees in every single case. Why? Because unless you're completely incompetent, you know what your company is doing, especially since you're getting your own compensation disbursement accurately paid.
FearTheCow
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Feel free to cite any cases in which a CEO stole pensions from workers and "hid" millions in foreign banks, I hear this shit all the time and yet every time one of you is called out its amazing how I dont get an answer other than more bullshit.
Is the company you work for based in just one location? a CEO's job isn't to know every last thing going on in the company, they guide the company and rely on others, so if no one is saying anything how the fuck is anyone who can fix or correct it supposed to know... Wait, let me guess, you bitch about it but have never really done anything to try and fix the situation.
The sheer amount of ignorance and stupidity in this thread makes my head hurt.
This is true in a pure market.
Problem. What do you do when the value of a human beings work is worth less than a robot? The value of course goes down. Reaction: go back to school and train in some other field and get another job. Problem. What do you do for people who have lower skills due to not being gifted with the same mind as the typical programmer? The people who are not merely average intelligence, but below average intelligence? The people who can work FIVE TIMES harder at the same work and still do worse because of the lottery of nature?
I want to reward results and merit just as much as the next guy, but I realize that part of our outcomes relates to something OUTSIDE our control, what we were born with. A genetic lottery. As such, if you CAN raise the baseline level of income and general prosperity, even if it takes a PORTION of the greater rewards for being for gifted in addition to harder work, why not do that?
I think you need to consider some sort of power sharing agreement or step aside, being a ceo is clearly making you quite bitter and resentful. If you fear for the future of the company and think that you and ONLY you have the right collection of skills then the company will be tossed onto a funeral pyre as soon as you pass on at some point. That is not a healthy way to think, no one is irreplaceable. Some people ARE harder to replace and have much greater value to an organization but if it's really taking this much of a toll I think you should consider taking your gains and doing something less stressful. And if not, if you choose to continue with those grueling hours and worrying about the fate of all those who work for you, then you might want to stop complaining about its toll because you CHOSE that path.
People may not get the exact details correct, but the gist of what they're concerned about applies. I don't know how one can claim to be knowledgeable about business and ignore hostile takeovers.
http://www.rollingstone.com/politic...-mitt-romney-and-bain-capital-20120829?page=3
B00nie
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In our country the immigrant gets free clothes, free housing and furniture + kitchen appliances, money for food for the whole family every month like clockwork, free education, dental, healthcare and I probably forgot something.
kbrickley
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Hostile takeovers are much more difficult and less frequent now ... that was more of an artifact of the freewheeling 80's and 90's. Most mergers these days are more organic in nature and designed to create the too big to fail style companies (which carry their own penalties and benefits) ... however, a hostile takeover was not a CEO stealing from his own company as much as a competing company eliminating a competitor and shrinking the market (versus the more modern takeover where they want to consolidate in order to more profitably grow the market)
FedEx, McDonald's, Amazon, for game companies, I know EA and Rockstar in the past have been guilty of this.
http://www.nytimes.com/2014/09/01/business/more-workers-are-claiming-wage-theft.html
Hell, you probably heard about the case where Apple, Google, Intel and Adobe were colluding to make sure they didn't poach other workers and collectively kept wages low across the industry. That's being settled for 415 million, I'd say preventing shit like that from happening falls within the realm of CEO duties, once numbers get that big, it affects the bottom line.
Of course the CEO can't know of every little thing going on in the company, but like you said, he guides it. When you see the same practices occurring over and over again in a company, that means it's incentivized. So a CEO probably isn't saying "make sure workers don't get paid for overtime", but instead says "We need to hit X goals by Q2 and need to keep our budget under Y. Materials costs won't change, so figure out a way to make it happen" then as long as the end result doesn't get dragged into court, bad behavior gets rewarded as long as it's profitable.
LIkewise all of the people complaining that CEOs make too much money are more than welcome to chose another path as well. It's easy to complain like a child, it's much harder to do something about it.
TwistedAegis
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It's a democracy issue as well. Over-concentrated power, whether it's in the hands of the uber-wealthy, corporation, government, etc, is bad.
And when the richest 80 people in the world own 50% of the world's wealth (http://fortune.com/2015/01/19/the-1-will-own-more-than-the-99-by-2016-report-says/) you have a fucked up system. Combine that with recent free speech rulings, and you see why we're screwed and why we complain about CEO pay.
But many of those same people are bitching about "socialism" and "over-taxation" while their wealth has doubled over the last 5 years. They won't stop until they have the freedom to harvest organs from their free-range serfs at any given moment, without anesthetic, because healthcare for them is communism and Jesus loves rich people.
What you don't get, and what people like you never will is that it takes YEARS of sacrifice to get that. 10x the sacrifice, 10x the work, 10x the risk, 10x the bullshit, 10x the worry, 10x knowledge, 10x the complexity, 10x the time, 10x the planning. It's not just about the work, it's about the years of preparation, sacrifice, and planning that leading up to it that you don't see.
I make more than my employees but I don't see anyone else stepping up to the plate and not a single person in this world is holding them down. I own two employees' cars after they failed to make payments because of poor financial decisions so I bought the note and they make payments to me at no interest so they can get to work. Would you have done that? I doubt it. People like you are all the same....employees that are too self absorbed to recognize that they're the only ones holding them back and you lack any sort of empathy needed to see that. I stand by my statements, employees like you are a dark deadly cancer on corporations because it's me, me, me ,me all day long. You don't know what your CEO does, you don't know what they've been through....you just assume and make ignorant assumptions and THAT is why you'll never understand why they are where they are in life.
So here's a suggestion. If it's so easy and so financially rewarding....DO IT. Until they you are full of hot air.
In all my years of owning businesses one thing is constant.....people like you......think they are irreplaceable when the reality is they aren't. There are billions of people capable of hauling rocks up the side of a piramid but very few who are capable of funding, organizing, and completing it.
TwistedAegis
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Can we differentiate between founders and CEOs? Because there is a big difference there as well. Many, maybe most, did not found their company nor risk their own capital in its growth.
The GoPro CEO only needed $200k to fund his business. Do you realize how easy it is to get a business loan for $200k?
So what, 80 people have a ton of money, how is that stopping you from taking out a loan and making enough money to buy your own business? It's not. Then you can change your little corner of the world. Nothing's stopping you.
Most of them do. The ones that don't work their way up to that point. The difference is that they keep going up when most people give up and stop.
I'm interested to see how your business plan works when you've redistributed all of the money usually used for leverage in growth and diversity. Since you're confident your business model will change the world you should man up and do something about it.
FYI, the man who's story sparked this debate did both.
Mods: sorry for the multiple posts, lack of an edit button after submitting....
TwistedAegis
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Really? It's so easy, he had to get it from his parents. He must have gone to the Mitt Romney school of lending.
Meanwhile, in the quantifiable world: http://www.nsba.biz/wp-content/uploads/2012/07/Access-to-Capital-Survey.pdf
And not everyone can be a CEO. You seem to be very angry that anyone should dare question that someone be worth several thousand times everyone else. It's a valid question, as it is a fairly recent re-occurrence of a human phenomenon. With the emergence of the middle class, humanity took a huge step forward. Now, many are trying to scrap that development and go back to landed gentry and serfs.
kbrickley
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I think the focus should be more on ability ... Lee Iaccoca didn't found Chrysler but he was an effective CEO for them and turned them around ... Paul Otellini didn't found Intel but helped them claw their way back after AMD really hurt them with the Athlon products ... Alan Mulally didn't found Ford but he helped them avoid the financial melt down and government buyout of the other USA automakers
We can argue about what an effective CEO compensation package would be all day long and never agree ... are they overpaid (even some of the good ones), quite possibly ... should they be paid less and employees more, depends (not all employees are worth as much as they think they are)
Bottom line is there are good CEOs and bad CEOs (just like every other position of the company) ... a good CEO who helps a company grow, expand, and increase their market value is worth his or her weight in Aurum ... a bad CEO who is not helping their company should be replaced without rewarding their incompetence or bad fit (and that is where the true opportunity lies ... getting rid of golden parachutes ... no CEO should be too big to fail) ... let the good ones get whatever they negotiate with the board ... let the bad ones be forced out without the massive payday for work they didn't complete
TwistedAegis
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From the data I could find, only 23 Fortune 500 CEOs founded their firm.
Meanwhile, half of all Fortune 500 CEOs (244) went to the same baker's dozen schools: http://www.usnews.com/education/bes.../14/where-the-fortune-500-ceos-went-to-school
So yes, if your parents start you out "right" with Ivy League education, access to social capital and actual capital, sure, it's possible and probable.
Meanwhile, half of all Fortune 500 CEOs (244) went to the same baker's dozen schools: http://www.usnews.com/education/bes.../14/where-the-fortune-500-ceos-went-to-school
So yes, if your parents start you out "right" with Ivy League education, access to social capital and actual capital, sure, it's possible and probable.
I guarantee you plenty of people at the bottom have 10x the sacrifice, work, risk, bullshit, and worry. I mean how many people do you know who work 2-3 jobs to make ends meet because many employers won't hire past ~35 hours so they can avoid benefits? Or again, in the game development industry, people working 80 hour weeks, not getting paid overtime, then get rewarded by being laid off half the time? News flash: there are MANY jobs that have inhuman demands on people in terms of hours, skills, and commitment, yet CEO and maybe stock managers are the only ones that pay out hundreds of millions. Everyone else is either moderately successful or else treads water.
What I don't get is you're equating the CEO to this god-king that is completely irreplaceable, somehow different than every single employee in the company. What is so special about CEO that distinguishes him from dozens of other upper management positions with good business acumen that are "only" getting paid 6 figures as opposed to 9? Or a better question, if CEO pay scale is so important and needs to be thousands of times more than other employees, how did corporations possibly function 60+ years ago when CEOs were only getting paid a couple dozen times more than the average employee? Surely all those businesses failed?
Well that's kind of the problem, they ALL are nowadays (at least the ones bringing in the kind of disproportionate incomes that make people double-take).
Yet he still did it. What's your excuse?
So in a thread full of people crying that they should get paid more you post a page stating that 53% of businesses can't get additional funding to expand their businesses and 52% of them cite employee pay and benefits as a reason? See the problem there?
Ignore the entitled children that are waiting on their Life-Participation-Trophies.
Nobody knows stress till you have had to make payroll.
Congrats on your businesses.
TwistedAegis
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Well first, I'm not able to get such a loan from my parents. Second, I'm not trying to be a CEO or founder, nor am I stating I'm worth millions. What we're all commenting on, and what you're instead turning into personal attacks, is that a single person in a company is not worth several thousand percent more than the average worker.
Pretty sure they're stating the CEOs are paid too much, not necessarily they're paid too little. And it was also to disprove your point that $200k is just falling from the sky for anyone who wants to start a business.