Interesting discussion, but government intervention or not (save for the minimum wage law), nobody is paid a salary on the basis of what's fair, right, or equitable. They're paid the market value for what their labor happens to bring to the table. Good leadership is worth it's weight in gold, and as the cliche goes, "you get what you pay for". Every employer and employee has to look at opportunity costs; i.e. why work here when I can get paid more to do the same job somewhere else? If somebody can explain to me why an "ordinary" worker like you and me making $40,000 / year is worth as much to a company as a quality CEO, then I'd like to hear that argument. Unfortunately, the supply of quality pilots / middle managers / front-line employees are much higher than the supply of quality CEOs, therefore my market value is less and the boss's market value is more (much more).
Now as for those who build themselves golden parachutes while driving a multi-billion corporation into the ground, those aren't leaders, those are crooks and probably belong in prison.
And how is that theory working out for us as a society, as a country?
That's what I thought.
Here's the deal.
People don't want to chage the status quo for a multitude of reasons. But at the core of each of us there is this belief, instilled in us from birth and re-enforced through the media, children's stories, church, etc. - that one day we too can be rich/famous/powerful if we just work hard enough (this convienetly benefits those in power but that's a whole other discussion). So we're all taught one day we're going to be rich and when that day comes we don't want to pay taxes or be told how much we can make.
The problem is if you're born into the middle class or blue collar labor or whatever your social status the bleak and harsh reality is you're probably going to die in that same social class. Yes, there are exceptions but if everyone were the exception we'd see the top 1% of wealth in this country distributed among a greater percentage than the current 1% of the population. At the time of the "big crash" in '28 the top 1% was distributed among the top 5% of the population. So, for the last nearly 100 years wealth has been trickling up the social ladder, not down.
So with this little jewel ingrained in us people don't make the choices that are best for them now. Need proof? Look at our curent administration and the 12 years of republican controll of congress. Record national debt. Record credit card debt. Out sourced jobs. Inflation out pacing wages. To say we are in a mess is an uderstatement. Democrats are just as guilty, btw but it has been almost 20 years of Republicans in power.
The '80's are just now coming to the cash register and we're paying for it.
As to what a CEO is paid, I never said a CEO shouldn't be paid accordingly. But 2,225 people in exchange for one person? It has nothing to do with what's fair, or equitable or right it has to do with bottom line. How does a board of directors justify so many resources being spent on something with such little return.
However, let's look at a little hypothetical.
Let's assume we all agree that Joe Schmoe is the single bet CEO ever to grace the face of hte Earth. No one can argue his skills. Give him a company where there are zero employees. No one will work for the company because of "X" reason. How long will that compnay survive without employees? Take a different company with the worst CEO on the planet. Give him a company that has employees who will show up every day (albeit disgruntled) and how long will that company stay in business in comparison to the first.
Leadership is essential, yes. But a captain of an empty ship, regardless of his skills, will soon find himeself adrift on the seas and watch helplessly as a mutinous ship sails by and it's captain is strapped to the bow mast with a dagger in his heart.
One individual employee is
not worth the equal of the CEO, but as a
collective they are
more important to the sucess or failure of a given company than the CEO and his top managers.
I'm glad you brought up the supply and demand argument. I love it when people bring this old time favorite out of the closet. If you take the roster of the FAA's "active" pilots (appropriately rated, i.e. commerical/atp) and pair them up to
just part 121 jobs the ratio is about 2 pilots for every 1 job. When you include part 91 operators, part135 operators and government operators the ratio drops significantly.
That is not an oversupply. By comparison the colleges and universities of this nation pump out MBAs (the only real "requirement" for a CEO position - much like the commericial or atp rating not withstanding experience) like the plague pumped out corpses. Yet CEO compensation as a whole has increased in the 1000's of percentages in just the last 20 years. Law schools in this country have been graduating roughly 12 lawyers every year for every one law job yet the median starting income or a lawyer (at a firm) is over 100k per year. The median starting income across the board is still nearly 60k/year.
The law of supply and demand works great in a sterile environment like a college classroom. It's just like communisim. On paper it works great. In the real world, with real people, and real power, and real back-room deals it gets corrupted. Sure it's still there and works a little but more often than not you have things like the Futures and Commodities exchange where as little as 100 people guess at what other people are going to do and artificially influence the price of goods like, say oil.
Again, supply and demand would truly work as it's taught in a completely free market but as we all know it's not a free market by anymeans so supply and demand simply doesn't work the way everyone likes to think it does.