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youbet · 05-17-2018, 11:20 AM

Quote:

Originally Posted by NW-Bound

the above Web page shows how some CEOs get away with a lot of bacon.

While it doesn't make unjustified CEO compensation right, the fact is the phenomena is not confined to CEO's. How about major sport pro athletes, folks at the top of the entertainment business, etc. ? The pay pyramid is very steep near the top of many professions.

Compare Tom Brady's salary to the guy who is working at the concession stand. Pretty high multiple, huh? Yet they're all in the same gig: providing entertainment on Sunday afternoon.

marko · 05-17-2018, 11:34 AM

Quote:

Originally Posted by bUU

What is a "solution" is subjective. If you are asking if there are changes that can be applied and accommodations that can be made to mitigate some of the harm inherent in what I outlined, then the answer is, "Yes."

That is what I'm asking. What the top 3 or 4 things you would change?

Rustward · 05-17-2018, 11:39 AM

Quote:

Originally Posted by youbet

<snip>

Compare Tom Brady's salary to the guy who is working at the concession stand. Pretty high multiple, huh? Yet they're all in the same gig: providing entertainment on Sunday afternoon.

Just a question: How many tickets are bought because of who is running the concession stand?

youbet · 05-17-2018, 11:43 AM

Quote:

Originally Posted by Rustward

Just a question: How many tickets are bought because of who is running the concession stand?

Don't understand your question. Either I inadvertently misspoke or you misinterpreted. I clearly was not criticizing the delta in compensation between the QB and the concession employee. I was stating that there are other professional situations besides CEO's and rank and file employees that have high compensation ratios.

Get it?

exnavynuke · 05-17-2018, 11:44 AM

Quote:

Originally Posted by Rustward

Just a question: How many tickets are bought because of who is running the concession stand?

Probably the same as the number of copies of Microsoft Office that are bought because of who the janitor at their office is.. 0?

marko · 05-17-2018, 12:06 PM

Quote:

Originally Posted by youbet

I clearly was not criticizing the delta in compensation between the QB and the concession employee. I was stating that there are other professional situations besides CEO's and rank and file employees that have high compensation ratios.

But I think you make a good point aside from CEO's not being the only ones with skewed pay.

Brady makes big bucks because he's 'worth it', however you may want to quantify that.

Like pro athletes, a successful CEO today really has to have his act together or he doesn't stay CEO very long. With all due respect, anyone can run a concession stand; not everyone can do what Brady does.

As someone here noted it's a matter of supply and demand; finding someone who can run Disney, Coke or Delta Airlines is not a matter of putting an ad on Craig's list. These people are hard to find and end up with huge responsibilities.

We can argue the level of compensation but trying to equate difference between an elite level employee and the guy sweeping the floor are really unconnected.

bUU · 05-17-2018, 12:57 PM

Quote:

Originally Posted by youbet

Yep. Great example proving my point.

But don't lose sight of the implications. It means that the same level of hard work that you and I put in will yield substantially inferior results for our children, and fewer people overall will enjoy the success we have. The system has reduced the number of "winners of the game" while the number of players has increased.

bUU · 05-17-2018, 12:58 PM

Quote:

Originally Posted by marko

That is what I'm asking. What the top 3 or 4 things you would change?

I don't want to get into that detail here because it has regularly led to rude exchanges in the forum.

MoneyIsMyHobby · 05-17-2018, 01:25 PM

Quote:

Originally Posted by bUU

But don't lose sight of the implications. It means that the same level of hard work that you and I put in will yield substantially inferior results for our children, and fewer people overall will enjoy the success we have. The system has reduced the number of "winners of the game" while the number of players has increased.

Of course, compensation has little to do with how hard the work is. Consider a teacher's salary as compared to an engineer. Consider a social worker's salary as compared to a veterinarian. While there is some connection between the toughness or risk (i.e. coal miner) of the job and compensation... there are other factors that have a much more significant impact. There is nobody at Tesla that will have a greater impact on the company's bottom line than Elon Musk... review the effects of his 2018 April Fools Joke...

Our lovely Country rewards people based on their unique advantages/aptitudes and how they apply those advantages/aptitudes, and we place higher value on certain advantages/aptitudes than others. My own wife worked in social work and found it very troublesome that I earned 5x what she earned as a Sales Engineer for the same quantity of hours, and arguably a less stressful job.

It is (mostly) about supply and demand. For teacher's and social worker's salaries to go up, more people have to be unwilling to do the job for the current going rate creating shortage. That said, I personally have considered going into teaching - trading the salary for summers off!

MIMH

marko · 05-17-2018, 01:38 PM

Quote:

Originally Posted by MoneyIsMyHobby

That said, I personally have considered going into teaching - trading the salary for summers off!

Come to Mass! Our niece in law is a second year third grade teacher making $80k. (And summers off)

bUU · 05-17-2018, 02:46 PM

Quote:

Originally Posted by MoneyIsMyHobby

Of course, compensation has little to do with how hard the work is...

Very true.

MoneyIsMyHobby · 05-17-2018, 03:32 PM

Quote:

Originally Posted by marko

Come to Mass! Our niece in law is a second year third grade teacher making $80k. (And summers off)

How is COL in Mass? Can I live on $80k there? I'll start packing tonight! Now to just learn to like kids... J/K

MIMH

NW-Bound · 05-17-2018, 03:52 PM

Quote:

Originally Posted by NW-Bound

I consider myself a card-carrying capitalist, but the above Web page shows how some CEOs get away with a lot of bacon.

They are not afraid of Porky; they would render all the fat out of Porky, and turn him into pork rind.

Quote:

Originally Posted by youbet

While it doesn't make unjustified CEO compensation right, the fact is the phenomena is not confined to CEO's. How about major sport pro athletes, folks at the top of the entertainment business, etc. ? The pay pyramid is very steep near the top of many professions...

Taleb in one of his books (I forgot which one) made the point that modern-day economics created the phenomenon of "winner takes all". That is particularly true in the entertainment business and professional sports. In the old days before TV and radio, less than first-class singers and entertainers could make money in traveling entertainment troupes and circus. Now, everybody wants to go see the best, or what is purported to be the best.

But these sport players and entertainers are rated by the audience that they serve. One may complain that the masses have poor taste, but hey, that's how people want to spend their money.

On the other hand, some CEOs get away with lousy performance, and still get rewarded handsomely. They have the board of directors in their pocket. As shareholders, we have no recourse but to sell the lousy stocks. Is there a better way?

Bogle had been vocal about corporate governance for a while, trying to get institutional investors such as MF and pension managers to be more active in selecting good company directors. I have not heard much about his activity in this area recently. I guess he gave up.

foxfirev5 · 05-17-2018, 04:04 PM

IMHO us passive indexers are contributors to the problem. A good old boy network of employee and board. It's been that way forever. As passive/indexers we take whatever they give us, You can't have it both ways.

NW-Bound · 05-17-2018, 04:15 PM

Quote:

Originally Posted by foxfirev5

IMHO us passive indexers are contributors to the problem. A good old boy network of employee and board. It's been that way forever. As passive/indexers we take whatever they give us, You can't have it both ways.

Bogle said that some MF managers told him essentially the same thing in a conference when he pushed for more activism. He did have some retort to that.

ERD50 · 05-17-2018, 04:33 PM

Quote:

Originally Posted by bUU

But don't lose sight of the implications. It means that the same level of hard work that you and I put in will yield substantially inferior results for our children, and fewer people overall will enjoy the success we have. The system has reduced the number of "winners of the game" while the number of players has increased.

I think the people in 3rd world countries who now have jobs doing some of the 'menial work' that was done here a while ago would disagree with you.

They may be making a fraction of the wages we did, but it is a big step up for them in standard of living. And I think most would agree that a step up in their standard of living means more to them then a step up in our standard of living ( the "marginal utility" aspect).

-ERD50

ownyourfuture · 05-17-2018, 04:36 PM

Quote:

Originally Posted by MoneyIsMyHobby

As I said, some folks certainly have an easier path to success than others, but you see so many folks self-sabotage their financial situation. I'm sure my tenants think that the man is keeping them down... as the Amazon truck shows up with their weekly delivery of "stuff they don't need" while they're racking up late fees to me for not being able to pay their rent on time. They're living room TV is literally twice the size of mine - just one more example.

Furthermore, as you say, it may be hard for people to acknowledge their privilege, but I think it is just as hard to get people to admit their own fault in their situation instead of thinking it is something outside their control (such as prejudice, discrimination, birthright, etc.).

MIMH

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