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from the because-when-they-mess-up-they-only-have-a-golden-parachute...wait-a-minute dept.
Why are CEOs of U.S. firms paid 320 times as much as their workers?:
Last August, Jamelle Brown, a technician at Research Medical Center in Kansas City, Missouri, contracted Covid-19 while on the job sanitizing and sterilizing rooms in the facility's emergency department. Luckily, his case wasn't severe, and after having quarantined, he was back at work.
Upon his return, Brown was named Employee of the Month in his unit and given a gift voucher for use in the hospital cafeteria. The amount: $6.
"That stung me to the bone," said Brown, who makes $13.77 an hour and has worked for almost four years at the hospital, owned by the corporate giant HCA Healthcare. "It made me sit back and say, 'This place doesn't care for me.'"
Research Medical's owner, HCA Healthcare Inc., is a profitable, publicly traded network of 185 hospitals and 121 freestanding surgery centers in 20 states and England. Even in the year of Covid-19, 2020, the company generated $51.5 billion in revenue and increased its pretax earnings by 3.6 percent. Its shares are up by 14 percent this year, versus 10 percent on the Standard & Poor's 500 index.
That performance helped boost the total compensation HCA's chief executive, Samuel N. Hazen, received last year to $30.4 million, a 13 percent rise from 2019, documents show. Although Hazen's salary was 5.8 percent lower in 2020, the total worth of his compensation package equaled 556 times the compensation received by the median employee at HCA — $54,651.
The figures highlight the growing CEO pay gap, a problem among many public companies according to some investors and workers and even a few CEOs. In 2019, for example, the average pay ratio among 350 large American companies was 320-to-1, according to research by the Economic Policy Institute, a left-leaning think tank in Washington, D.C. In 1989, the average was 61-to-1.
(Score: 2) by sjames on Monday April 12 2021, @03:56PM (3 children)
There's a whole world full of CEOs used to working for a fraction of what American CEOs make, why not hire them?
(Score: 5, Insightful) by Anonymous Coward on Monday April 12 2021, @06:37PM (2 children)
Because they're not in the club.
There's an entire social strata in the U.S. that consist of what are usually loosely referred to as 'the elite'. These are the old money, trust fund families, whose kids go to the private schools none of us schlubs have even heard of, the ones who get into Harvard and Yale as a matter of course. Occasionally some up-and-comer who makes billions via some tech firm are permitted entry, to keep the money and power amongst the elite, but for the most part if you ain't born into it, you ain't getting in.
This is where the CEOs come from. They sit atop their firms and extract money, and sit on the boards of other companies and help those firms' CEOs extract money. If someone makes an oopsie at one firm, they shuffle the chairs around for a while and make sure the one who hath transgressed is taken care of. Sure, there aren't enough spots for everyone to be a C-level exec at a company -- that's what politics is for. The ones going into politics help the ones in the companies retain economic control, while the companies help the politicians retain political control. Administrations change and one set of club members take over while the other set cools their heels in a C-level spot, or one of those think tanks that exist to keep money flowing to them while they await another shuffle of the chairs.
Yes, yes, of course there are a few "outsiders" given the top spots at some of the high-profile companies for a few years. You know their names. That's why they're there, for you to know their names, and thus think that the system is as advertised and if you only work hard enough and long enough, you too can climb that ladder.
The actions of these CEOs and the rest of the elites, are far better understood if you assume that they have little desire for more money. They've already got money, any more money for them is just like one of us running up the score against our buddies in the bowling league. They are colluding with each other to maintain their control. As long as they have control, they'll never need to worry about money. That's why so many companies are appearing to behave in a manner inconsistent with the idea that companies exist to make money, and will act in ways as to make more money. No, the people in control of the company have other goals, and the company is merely a tool to use for those goals.
(Score: 0) by Anonymous Coward on Monday April 12 2021, @11:44PM (1 child)
this guy gets it.
(Score: 2) by edinlinux on Tuesday April 13 2021, @03:22AM
+5 to the above..
It is exactly like this..I have been there and seen it first hand..