I was reading an article today and saw that the CEO of my company made a hefty chunk of change last year. It turns out that our company did pretty well, so the compensation that our CEO received was significantly higher than the year before. I’m pretty happy with how our company did last year. We increased revenues and profit margins and paid decent returns for our shareholders.
I faired pretty good for the year as well. Between my salary, benefits and annual bonus, I made the most money I’ve ever made in my career. I’m incredibly satisfied with my earnings and if I never got another raise again until I retire, I’d be very happy. Literally, I’ve got nothing to complain about.
I did find myself thinking about how out of whack our economy has become though. Even with my good wages and benefits, our CEO only has to work about 8 hours to make as much money as I made last year. For many people at my company, he would have only had to work about 4 hours to equal what they’d make in a year. I found myself wondering, “Is this how we want our society to be? One guy is paid so much money that he can earn in 4 hours, what it takes others in his company to earn all year?” For some people this is fine. Capitalism says that the market will pay what is needed to attract and retain the best person for the job. If the going rate for a CEO is high, then all CEO’s will make many millions, even if some of them turn out to be horrible. I’ve read many articles about CEO’s that decimated companies and then left with millions in severance packages. They were smart enough to negotiate those terms when they signed on for the job.
Imagine if the average worker could negotiate those kinds of things when they accepted a job. Some new kid at McDonald’s could agree to start at minimum wage with the understanding that if he burned the hamburgers, or failed to keep the bathrooms clean, he’d still be eligible for 2 years earnings and health care for the rest of his life. It’s safe to say there would be a lot of dirty bathrooms and charcoal burgers being served around the country. Yeah, that’s a crazy example but I think you get the point I’m making. While CEO’s run huge companies employing thousands of employees, are they really that important? They’re certainly more important than the lowest level employee that just started at the company but are they 320 times more important?
Just a thought for a Friday night……