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April 21, 2014

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Letter to the editor:

Execs rewarded, workers shafted

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The headline in USA Today recently read, “Market gains pump CEO pay, corporate chiefs pull in $50 million or more.” Listed were the stock option gains for the CEOs of Starbucks, Ford, Sherwin-Williams, Chipotle Mexican Grill and Apple, all over $50 million for 2012, which is in addition to their salaries and perks. Shareholders did not complain, as they too got very wealthy.

The question remains: What did the employees at these companies get for the fantastic profits that the companies celebrated? Did they get a bonus, comp time or a salary increase? I’ll bet no raises, no bonuses, no increased benefits — just the opportunity to serve a company that only rewards the executives.

Why don’t corporations consider rewarding employees? I think Ford has a profit-sharing agreement with the new UAW. What happened to sharing the wealth? It’s been replaced with hoarding the wealth.

The middle-class workers did not receive rewards even though it was their productivity that was the driving force in the rise of the stock price. We know workers’ productivity is way up, but their salaries are not in line with employers’ profit gains and increased expectations. The income and privilege gap is getting wider every year and the Republican Party is dedicated to keeping it that way. Watch out for the new business model of 29 hours or less a week with no benefits for workers. The new agreement between Ford and the UAW could be a model to save the middle-class workers and private-sector unions.

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  1. Future: And when the market crashes into the toilet ala 2007 and 2008, 401k's aren't worth jack.

  2. Anyone can make money in an up market and economy. It takes savvy 'gamblers' to make money in down markets and economy. When they do [make money in bad economic times], of course those who don't and can't get jealous. They want it too same without having to work hard to get it. We have a name for these people: Democrats.

    Carmine D

  3. Enjoyed the letter, Mr. Starr.

    The disparity between the rich and the middle class is great. Even worse, the separation between the rich and the poor is astronomical. Out of this world.

    I have always said the once labeled War on Poverty was misnamed.

    It really should be a War on the Rich.

    I don't have a problem with people who make money. More power to them. But when the deck is stacked against people to even try to attain the American dream, there lies the problem. It goes to the area of greed, selfishness, and pounding the poor into dust.

    None of us out here created this term the Tea/Republicans like to refer to as "class warfare."

    But we'll darn sure end it.

    I intend to vote straight Democratic Party ticket from now on.

    To get at the rich, it's a known fact you have to go after the Tea/Republican politicians. Because they seem to run interference for them all the time.

    You knock them out the way, then and only then, can this disparity issue be settled.

    Vote Democrat in 2014!

  4. More of the same drivel known as the "politics of envy." Who cares what others earn? Why is that important and how does it help one to become self-sufficient or self-reliant? My goal during my working life was to make myself more valuable so as to earn more money and advance my position in the company. How about you? Our whole system is based upon merit and, if someone earns more (unless propped up by taxpayer funds), why moan and groan over it? Don't you have anything better to do? Get a life!

  5. The good thing about living and working in America, is this country offers the same opportunity to all it's citizens, who want more out of life to simply go for it.It's there for every one who wants to work a little harder to get it.

    Stop worrying about what others have and go out and get yours.It's a great time to take advantage of all the things that are available to all willing to put in the extra time and effort.

    There are plenty of stories of people born with nothing who end up with everything they ever wanted. Why is that? Because the American dream can be achieved by anyone that is willing to work hard and forge ahead with their own ideas of how to get it.Male or female it don't matter.

    Oh to be young again with opportunity,nothing greater.

  6. SIMPLE RULE : The bigger the company the tighter they are with taking care of thier employees. I've been working for the same company for 35 years and everytime a bigger company takes over, the money gets tighter as do the benefits .Thats the way the ball bounces, you want more ? , go get a masters in business and become one of those CEOs.

  7. There's a bit of argument over Mr Starr's letter: some agreeing, some disagreeing and several citing individual cases. The date: in general, CEO pay in 1978 was 42 times that of the average worker. In 2011 CEO pay was generally 380 times that of the average worker. During that period CEO pay went up 725%. worker pay went up 5.7%

    Anyone so inclined can find instances of individual CEOs at individual companies whose pay went up more than that or less than that. RefNV (Re Freeman) did so in his 3:21 a.m. comment saying, in part, "In 2010 the average hourly worker at Ford received wages, benefits and overtime totaling $109,020." He fails to show that, in the same year, Ford's CEO was paid a total of $26.5 million - 243 times the average hourly worker.

  8. Even stockholders have no say in exec compensation. The "boards" just keep upping the comp packages with hype about keeping talent--where would they go? Look at Ron Johnson DESTROYING JCPENNEY. Think he deserved the millions? I've been moving my investments into smaller cap stocks, fixed income, overseas and anywhere but large-stock domestic companies.

  9. The real issue at hand, is that a significant or major part the wealth re-distributed upwards ends up in International and off-shore bank accounts, waiting to buy up millions of homes, property and representatives after the economy collapses again. This will bring Old Europe to North America.

    CEOs stash cash offshore to be used for their advantage during tragedies while the employees recirculate cash to create more good times.

    Standing over the money pot and writing one's own checks does not constitute earning of the reward.

  10. it would be nice if reporters actually reported facts. Apple stock is down some $300 per share for the last 5 months.

  11. "...I'll bet no raises, no bonuses, no increased benefits -- just the opportunity to serve a company that only rewards the executives..." Author, you don't seem to know the answer to the question you asked. That makes your article really silly.

  12. RefNV (Re Freeman): At 4:47 p.m. you criticized my post showing the increasing differential between CEO compensation and hourly-paid employee compensation, saying, in part, "An hourly employee will not be paid the same as a CEO. Different responsibilities, different tasks & duties, different job requirements, different job classes and different pay rates."

    I totally agree with you. After re-reading my original post I fail to see how it could be interpreted to say I don't. What I DID do, although not explicitly, was to ask how has the job of the CEO so drastically changed between 1978, when the average CEO was paid 42 times as much as the average hourly worker and 2011, when the average CEO was paid 380 times that of the average worker?

    Despite holding an MBA, I can see 3 possibilities - 1) The CEO today is doing 725% more today that he did in 1978 (although I've seen absolutely NO data to support that); 2) The hourly worker is doing only 5% more today than he did in 1978 (yet the data clearly shows that labor productivity increased better than 80% since 1978); 3) Greed on the part of the CEOs and the power to redirect compensation increases from the
    workers to themselves (and you're correct, I have seen no DIRECT evidence for this, only a variety of related evidence, particularly the significant increase in income inequality since the 1970s, as measured by the Gini coefficient)