Publications, including Business Week, the New York Times and Forbes have recently
written about alleged abuses involving CEO compensation.
Business Week reported that Michael Eisner, CEO of Disney earned $565 million
in 1998 and nearly $1 billion over the past ten years. On its website, the UAW
lists the compensation of the largest corporations in America in an effort to
expose the glaring disparities between the haves and the have nots.
What the UAW and its liberal allies fail to appreciate is that being a CEO like
Eisner has many downsides. How would you like to spend your time doing the following?
1. Attending conferences in Aspen in January and the French Rivera in the summer
2. Consuming caviar and washing it down with Don Perignon
3. Shopping at Neiman Marcus, Tiffany's and Sax Fifth Avenue
4. Driving a Rolls Royce, Ferrari and Lamborghini
5. Supervising maids, butlers and gardeners for multiple homes
According to Disney's website (www.disney.com), Disneyland in California supports
approximately 65,700 jobs in Southern California. The bulk of these 'service
related' jobs likely paid no more than $7.00 an hour in 1998 or about $14,000
a year, which is hardly a living wage.
Eisner's $565 million in earnings in 1998 equates to $8,600 for each of the
65,700 employees that work to support Disneyland. Bleeding-heart liberals like
the UAW would have us believe that each of these workers should have received
the $8,600 rather than Eisner.
If the liberals had their way, the $8,600 would have been paid to Disney workers
to assure a living wage, money they likely would have wasted as follows:
6. Shop at Wal-Mart instead of a Salvation Army Thrift Store
7. Order basic cable and toss out their rabbit ears
8. Dine at Denny's once a week instead of bi-monthly
9. Upgrade from Milwaukee's Best to Budweiser
10. Trade in their 1969 Volkswagen for a 1971 Ford Pinto
What these liberals and minimum wage workers fail to appreciate is that, if
it wasn't for Eisner's efforts, the Disney workers wouldn't even have a job.
Talk about a bunch of ingrates! Put simply, their argument is Goofy at best.
At least Eisner spent his earnings in a manner that helped to keep the economy
humming. He spent millions purchasing multiple homes, which benefited construction
workers. And what about all the housekeeping, shoeshine, and cooks-helpers jobs
he created at 5- Star restaurants and hotels?
Then we have Douglas Ivester who resigned (forced retirement) after laboring
for two years as the CEO of Coca Cola. During his two-year reign, the shareholders
reaped a negative return on their investment of 7.3%. (Business Week) And for
his efforts, Ivester received going away benefits of about $120 million.
And you thought failure didn't pay well! If you're a cashier at Wal-Mart, scan
every other product when checking out a customer. When the boss tracks the losses
to your register, maybe you'll be in line for the same punishment Ivester received
Last year, Computer Associates CEO Charles Wang earned $655 million (Business
Week). Computer Associates has a worldwide workforce of 15,000 people in 50
countries. (Source: http://www3.ca.com/career/) Therefore, Wang earned $43,666
for each employee of Computer Associates.
Let's compare Wang's earnings against the wages of a minimum wage (MW) laborer
and an auto worker at the Jeep plant in Toledo, Ohio.
Daily: Wang = $2.6 million MW = $41.20 Jeep = $280
Hourly: Wang = $325,000 MW = $5.15 Jeep = $25
Weekly: Wang = $12.6 million MW = $206 Jeep = $1000
On a yearly basis Wang's $655 million in earnings are equal to what 61,215
minimum wage earners would earn (entire population of Saginaw, Michigan), and
what 12,596 Jeep workers would earn annually.
What do you think is fair--annual income of $1.34 billion for Wang, Ivester
and Eisner (WIE?), or a living wage for 1.3 million fellow-citizens working
at the minimum wage?
Call me a bleeding-heart if you will; however, I find it unconscionable for
any CEO to earn more than $5-7 million a year. Arguments put forth by CEO's
and their cadre of apologists and enablers claiming they can't get good help
unless they pay $10-15 million a year is pure bunk.