Obscenely high CEO salaries are stark marker of U.S. wealth gap
A beginning elementary school teacher in a small district in California makes around $40,000 per year. That’s 2 or 3 thousand dollars more than poor Larry Ellison brings in -- but Ellison, the CEO of Oracle Corp., earns it in an hour.
There’s nothing that illustrates the vast and growing wealth gap in America more starkly than a list of the incomes enjoyed by the top business executives in the country. A new study done for the New York Times found that pay for the 100 top CEOs jumped 9% from 2012 to 2013, raising their median annual compensation to nearly $14 million.
At the top of the pile is Ellison, the Silicon Valley potentate and America’s Cup champ, who is the fifth-richest person on the planet. Divvying up Ellison’s yearly cash, stock and options package into 40-hour-a-week slices, New York Times reporter David Streitfeld set the CEO’s hourly earnings at $37,692.31.
No. 2 on the generously paid CEO list is Robert Iger, head man at Walt Disney. He has to scrape by on less than half of what Ellison takes home and must work more than two hours to make what that starting teacher earns in a year. Another movie and media mogul, Rupert Murdoch, comes in at No. 3, which is also the number of hours he needs to work before he matches that teacher’s annual income.
CEO compensation has been controversial for many years, and various efforts have been made to rein in the runaway pay scale. Nothing seems to be working. It might not be such a point of contention if all boats were rising, but, as we well know, incomes for most Americans have stagnated for three decades. As the nation has become immensely richer, a tiny share of our citizens have raked in exorbitant gains.
CEOs are just the most visible beneficiaries of an economic system that values and rewards a small cluster of people at the top in an outlandishly disproportionate way. Sure Ellison and Eiger and Murdoch are good at what they do. They are probably business geniuses. But are they orders of magnitude more valuable to our society than a teacher or a nurse or a fireman or a farmer?
In 2013, Tim Cook, the boss at Apple, and Steve Ballmer, the just-departed head of Microsoft, received seven-figure pay packages -- $4.2 million for Cook, $1.2 million for Ballmer. That’s pretty good money. Cook and Ballmer, though, were near the bottom of the top 100.
In a more sane economy, that kind of money would put them at the top, but sanity is no longer the rule. Today, the super rich get super richer and the middle class continues to feel the pay ceiling press heavier on their backs.
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