4/07/2006

I have a ton (well five) emails challenging my statement that corporate execs earn 214 times what their workers earn. Robert Devlin of American General earned 45mil last year; Michael Capellis of Compaq pocketed 36mil; Eugene Isenberg CEO of Nabors Industries scored a fat 28mil and so on; keep in mind that these numbers represent only compensation, they do not include returns on investments, stock and stock options, or capital gains from selling stock. Nor do they include the value of perks; things like company cars, yachts, vacations to heavenly places, and God only Knows what else. The lower paid employees---not the lowest---earn $25K. Multiply that by 214 and you get $5.3 million and the poor CEO that earns that paltry sum in compensation is only number 75 in the corporate CEO list. Guys who make their money from Real Estate, stock investing, commodities speculation (George Soros) and so on are not listed. Forbes has a completely different list of high paid CEOs, a list that ends with number ten, a guy who only earns $30mil per. My point is only that the spread between the lower paid employees and the top is a multiple of 214 overall. It is interesting that there is a huge difference between compensation and net worth, a figure derived from stock holdings (Gates 40billion, Buffet 30billion, etc.), property holdings, jewels and so on. There are a lot of lists; for example Electronic Business lists forty different people with incomes ranging from $45mil to $9mil. Actors, athletes, "artists" and other entertainment gazillionaires and so on are not listed. The figure of 214 is an average that is derived from all sources (not defined) and could be higher or lower.

View from the bottom: Today more than 28 million people, about a quarter of the working-age workforce, work full time yet still earn less than the income that marks the federal poverty line for a family of four which is $9.04 per hour; a full-time salary of $18,800 a year. Child care workers can't afford the care they provide for their own children, and retail workers cannot pay for the goods they sell to others. And these same people are on the dole if somebody in the family gets sick. It is inevitable that these people will eventually start shooting. They will be joined by people working two and three jobs just to break even. I hope all of us will take this income gap seriously.

2 comments:

Anonymous said...

Howard,

You do realize that that poverty line is arbitrarily set by the government. It's not a true measure of poverty but a line drawn across income levels for a given year. The bottom 10% are counted as in poverty. And it's bullshit.

Single moms receiving both welfare and child support? That's not considered income according to the Feds. My brother pays after tax dollars to his ex for child support and those are 'frigin tax free dollars to the mother. Bullshit.

Your 214 multiplier? Nice if incomes were static but they are not. You earn crap as a kid and gradually earn more. Degrees multiply that effect. I earned $4.70 an hour in high school. I worked 20 hours a week. I was a poverty statistic at 14. I'm now well in the machine and I'm doing quite well. By working my ass off.

Your premise has legs, but barely.

MC

Anonymous said...

Today more than 28 million people, about a quarter of the working-age workforce

11-14 mil. of those are probably illegales. Repatriate 'em all and America's poverty problem is cut by 1/3 to 1/2.

-- david.davenport.1@netzero.com