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RE: Golden Parachutes

in #goldenparachutes6 years ago

There are several reasons the connections between government and these huge corporations fuel such a wide disparity in CEO to worker pay. The biggest reason is that protectionism allows these companies to grow much larger than a competitive market would allow. Under normal market conditions, companies have to consider a variety of factors like consumer esteem (which most megacorps flagrantly ignore). And without friends in Washington favorably altering tax laws, subsidies, loan terms, etc., a corporation could never afford these CEO packages. Which is why only megacorps run pay ratios of 300:1. In the real world (and more realistic capitalism where market forces like competition actually exist) that ratio drops way down. Looking quickly, I couldn't find data newer than this, but it's still helpful: "The average CEO in the United States earned a salary of $178,400 in 2013, compared to $46,440 for the average worker (both figures exclude benefits)." (average = smaller firms not connected to/enlarged by the federal government)

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I don't need to add any more to that great explanation 😇

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