Corporate greed causes inflation — not worker’s salaries.

In AP Business on June 3, 2024, Mae Anderson, Paul Harloff, and Barbara Ortutay reported that the pay for chief executives in Fortune 500 companies jumped 13% last year when inflation was beating up workers. The median pay package is now $16.3 million. However wages and benefits for private-sector workers rose only 4.1% through 2023. At half the companies surveyed, it would take the worker who produces the value 200 years to make what the CEO does.

Two dozen CEOs in the survey got a 50% pay hike. Have you ever gotten a 50% pay hike?  Boards claim they want to retain good leaders but even failing CEOs who destroy companies like Boeing get golden parachutes as they go out the door. Yet profits are strong, and the stock market is up. But the stock market is not the economy; a fact that many people fail to grasp.  

Mark Zuckerberg makes the highest returns; Tim Cook makes 672 times the average Apple employee; Hock E Tan, president and CEO of Broadcom, is the highest paid at $162 million. What does anyone need with that kind of money? Broadcom is cashing in on the AI mania that will put real workers out to pasture.

Calls to tie compensation to performance have some companies giving stock rather than cash to CEOs so they can’t cash in unless things get better. Why not give your employees stock shares too at every anniversary and holiday?  If it’s an incentive for the CEO why not for the worker who produces the wealth? The median stock award went up 11% while the actual bonus went up 2.7%.

Other CEOs at the top of AP’s survey are William Lansing of Fair Isaac Corp ($66.3 million);  Hamid Moghadam of Prologis Inc. ($50.9 million); and Ted Sarandos, co-CEO of Netflix ($49.8 million). The survey’s methodology excluded CEOs such as Nikesh Arora at Palo Alto Networks ($151.4 million) and Christopher Winfrey at Charter Communications ($89 million). 

At Apple, Cook’s compensation at $63.2 million represented a 36% decline from the year prior. Cook requested a pay cut for 2023, in response to the vote at Apple’s 2022 annual meeting, where just 64% of shareholders approved of his pay package. Boards are still approving these kinds of raises despite opposition.  Even when shareholders reject a pay raise, the rejection is not binding.

Although securities filings show Elon Musk received no compensation as CEO of Tesla Inc., his pay is currently front and center at the electric car company. Musk is asking shareholders to restore a pay package that was struck down by a judge in Delaware, who said the approval process for the package was “deeply flawed.”

Companies are required to assign a value to stock awards at the time they’re granted. The award given to Musk in 2018 was valued at $2.3 billion. Even if Musk were to cash out portions of those awards — he hasn’t yet — that wouldn’t count as compensation. Musk’s pay package is now estimated to be worth around $45 billion. 

Workers pay has gone up by 5.1% in 2022 and 4.1% in 2023. That is a pittance compared to how the CEO pay has gone up by 185 times in last year’s survey and 196 times this year. It’s getting worse not better. The poorest suffer the most. At Ross stores where the median part time worker makes $8,618 it would take 2,100 years to reach the CEO pay of $18.1 million which increased from the year before when it would have taken 1,137 years. I don’t know about you, but I don’t have that kind of time.

Only .07% of the top paid CEOs were women, but they made more than the men because they perform better. The median pay package for female CEOs rose 21% to $17.6 million. That’s better than their male counterparts fared: their median pay package rose 12.2% to $16.3 million. Hard to scrape by on that.

The AFL-CIO tracks CEO pay at the Executive Paywatch website. Brandon Rees, the deputy director of corporations and capital markets said that after World War II and up until the 1980s, CEOs of large publicly traded companies made about 40 to 50 times the average worker’s pay.  Now CEOs make 531 times the average worker pay https://www.svsu.edu/media/writingprogram/activedocs/Whelton_article.pdf or 200 times according to the AP Business article.  

We need anti-trust laws to be strictly enforced. We need pay gap ceilings as exist in most nations in the world. We need workers’ pay to be commensurate with the cost of living and the value they produce. We need health care and retirement benefits that we used to have. But we won’t get any of that until we unionize. Fat cats are lining up to make sure America’s number 1 criminal becomes president and we must do all we can to ensure that doesn’t happen.