A recent report, co-authored by the Institute for Policy Studies and United for a Fair Economy, echoes once again what many on the street believed already -- CEOs are swimming in deeper and deeper cash pools, while the average worker meanders in a stagnant pool of "just getting by."
The report is extensive, and I encourage you to take the time to educate yourself on the subject. But I do want to capture a few of the more troubling statistics related to the ratio of CEO pay to average worker pay. According to the report, since tracking this metric in 1990, this figure has grown from 107-to-1 to 411-to-1 in 2005. The report adds that if "minimum wage had risen at the same pace as CEO pay since 1990, it would be worth $22.61 today." Business Week began tracking this ratio in 1980, at which time the figure was 42-to-1. The figure for 2005 is nearly 10 times larger.
Folks, there's no way to spin it clean. If it looks dirty, feels dirty, and smells dirty, it probably is dirty. We can say that many CEO compensation packages today are tied to stock performance, so in light of the bull market run over the past 20 years or so, it makes sense that executive pay would far outpace general labor rates. We can say it, but I'm not sure it makes any of us feel better about it.
In his autobiography Sam Walton: Made In America, Sam Walton also came down hard on exorbitant executive pay, arguing instead for compensation packages tied more to stock performance. Obviously, the rise and dominance of Wal-Mart
But there's just something about Walton's argument that doesn't sit for me when considering the rapidly escalating stock prices for defense and oil stocks. Haliburton's
The report adds that defense executives aren't the only ones sitting with fat pockets these days. Big oil execs found black gold in more ways than one. The top three highest paid U.S. oil execs in 2005 were from Valero Energy
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Fool contributor Jeremy MacNealy has no financial interest in any company mentioned.