nice read about a real problem

[callmeslick]

http://www.msn.com/en-us/money/companie ... ar-BBluD5O

when my Dad was the VP of a major chemical corporation, he made about 9 times the starting chemist salary. The CEO and President were paid about 20 times starting pay. That was in the 1970s. Good to see that someone fleshed out the very real issues for businesses when the ratio gets so thoroughly out of whack that 300X starting pay is a norm. Under the old reality, folks still could make a lot of money as a CEO, and live extremely well. But, with higher morale, better employee relations the nation's corporations enjoyed a level of output and ingenuity for which we now rely on garage start ups to provide. This is bad for the economy, disaster for some within it, and bodes badly for the future. Comments?

[Spidey]

I see this as an ethics issue, but have failed time and time again to connect the dots as a serious economic issue.

And just to begin here are two issues I hear but can’t seem to connect the dots.

1. Rich people keep money out of circulation:
Well unless they are keeping it under the mattress, it’s probably in a bank, where it is being used to buy and fix houses, cars, starting and expanding businesses…etc…in other words money in a bank is never out of circulation…that also goes for stocks bonds…etc.

2. I did the math during the Hostess debate and using 10 million dollars as the base, I divided it by the number of employees (30,000) and came out with about 6 bucks each per week. So the idea that people are prevented from sending their kids to college and such is mythbusted. Sure an extra three or four hundred dollars a year can buy a few things, but not really make any kind of significant economic difference. (as far as more money in the economy…see above, not to mention that wealthy people also spend money)

[callmeslick]

1. Rich people keep money out of circulation:
Well unless they are keeping it under the mattress, it’s probably in a bank, where it is being used to buy and fix houses, cars, starting and expanding businesses…etc…in other words money in a bank is never out of circulation…that also goes for stocks bonds…etc.

it doesn't circulate in the same way as people buying consumables, and you overlook the fact that most of the truly wealthy have a good deal of the 'non-circulating' cash offshore, so helping a bank in Macau, or the Virgin Islands isn't really providing too much domestic traction. Likewise, a lot of the investment in this day and age is in corporations OUTSIDE the US(nearly 20% of my portfolio is based in Europe, Asia and Israel), once again one step away from mattress money for the sake of the local economy.

2. I did the math during the Hostess debate and using 10 million dollars as the base, I divided it by the number of employees (30,000) and came out with about 6 bucks each per week. So the idea that people are prevented from sending their kids to college and such is mythbusted. Sure an extra three or four hundred dollars a year can buy a few things, but not really make any kind of significant economic difference. (as far as more money in the economy…see above, not to mention that wealthy people also spend money)

once again, you are keeping the blinders on too tightly. First off, it isn't just the CEOs. The corporation I worked for had 58,000 employees, and had 14 executives bringing home a total of around 59 million most years(a few years it hit close to 100 million). So that is a $1000 per year drain on the average employee. Secondly, if you read the linked article mentioned in the main article, it is shown that once the CEO/starting wage dispartity gets past 30-1, you lose employee loyalty, and morale is lowered. It is bad business, pure and simple, driven by the greed of a few.

[Tunnelcat]

.... I did the math during the Hostess debate and using 10 million dollars as the base, I divided it by the number of employees (30,000) and came out with about 6 bucks each per week. So the idea that people are prevented from sending their kids to college and such is mythbusted. Sure an extra three or four hundred dollars a year can buy a few things, but not really make any kind of significant economic difference. (as far as more money in the economy…see above, not to mention that wealthy people also spend money)

Well, your math doesn't include that I personally have quit buying Hostess products. One less customer. I also quit buying Kellogg's products as well. They are currently trying to bust their unions and are being unapologetic about it. While CEO's and others at the top skim off the cream of the profits and make record salaries, the workers who make those products are left with the paltry remains, especially when most companies are racing each other to the bottom with consumer prices these days. Sad. It's a self fulfilling prophecy. In my opinion, when the workers at a food company aren't happy, the product they make WILL suffer. Unfortunately, that's human nature and revenge is one of them in any antagonistic relationship. Happy workers make good products and like their bosses and do good work. Bosses who like and respect their workers usually get more productivity and better work out of those workers. Unhappy workers take it out on the employer and try to screw the man by making the product bad for his customer and getting his sales to fall. Unhappy workers also don't give a crap about their job, union or not. Seems counterproductive, doesn't it? Greed isn't only at the labor level. Greed knows no social class. Those who run the company are just as susceptible as those who work for them.

[Spidey]

Like I said, I see the ethical problems involved in this issue.