DISQUS

Corporate Barbarian · 2 months ago

Regarding the sense of entitlement, we were once invited to a Sweet Sixteen party at a really expensive catering hall. I could only imagine what the bill came to for over 200 guests. After experiencing that excess, what else will the girl expect, a wedding at the Waldorf-Astoria? You can blame the parents for the indulgence, but I feel sorry for the girl when she finally gets a dose of reality.

Ellen / MoneyLounge · 2 months ago

I also find it impossible to believe that anyone really "earns" $750,000 per year. Honestly, what on earth would you have to do for it to be worth that much?!

David@DINKS Finance · 2 months ago

You shouldn't think of it as "earning" that much, instead think of it as they "make" that much, because they do. Regardless of how you look at it, some employees at companies make a boatload of cash. I know head of currency trading desks make well in excess of $1 million / year but that's because their unit made the company (shareholders) much more than that.

It's the system we have and instead of getting upset about it, realize why it is that way. The reason executives make so much is because the shareholders do not demand they get paid less. I find it ridiculous when Washington throws around stuff like "we need to cap executive salaries!" Please. If you don't like how much an executive is being paid, DON'T BUY THEIR STOCK! It's so simple. The people who lose when executives get paid a ton are the shareholders who are paying them, not anyone else.

Ryan · 2 months ago

I strongly disagree that no-one can "earn" $750,000 a year. While you may not feel that the CEO of major companies "do much", I'd invite you to try and take that job for a period of time and see the results. What you "do" at that level is very different that what others do at other levels in an organization. The value added, or destroyed, at the helm of a major company is orders of magnitude larger than the value added or destroyed in other places. With that additional responsibility comes additional compensation.

Are there excesses, absolutely. However it is incumbent on the shareholders and the board of directors for organizations to stop those excesses when they exist. Furthermore, it is incumbent on the board and shareholders to ensure that the compensation paid is done so in a manner that provides maximum benefit to all parties involved (ie: long term sustainable growth).

Anyhow, everyone is entitled to their own opinions. I just think a lot of thought should be put into blanket statements along any lines. The responsibilities of different jobs and the impact that they have should be, and generally is, commensurate to the compensation paid.

Apex · 2 months ago

Since no one "earns" 750K what is your definition of how you earn money. You listed teachers (who's job is hard but not complicated .... waitress is just as hard from what I hear so if it's how hard it is then waitress should be high on the list), if its impact on other people's lives then you could argue that teachers have a great impact and you could value it that way. Emergency workers save lives so that could also fit but then doctors should also be on the list who already make huge salaries. What about drug company execs (or drug company financiers or whoever you consider responsible for creating new drugs). They could be argued to save millions of lives, so then they must be "earning" very high wages if earn is measured by impact on people's lives. You listed investigative journalists who find wasteful spending in govt. So that appears to be an argument based on those who protect the financial assets of people (not wasting their tax money). It seems those who grow people's money are also protecting assets although perhaps you think growing money is not earning in the same way as preventing loss or waste of money is.

It appears to me that your list is based on two things. 1. Those who provide value to the lower and middle class, and 2. those who work in professions that liberals place particularly high importance on relative to other occupations (education, health care, journalism).

I suspect you don't agree with that classification. Would you care to show me why its wrong and how you determine that teachers earn high wages and CEOs don't earn high wages? It would be instructive to see a formula or a rule of thumb one would use to determine how much one earns in a given occupation using your definition of earn.

Apex · 2 months ago

As a side note I wanted to say that I completely agree with your entire overall sentiment, that of understanding that you have to put in effort and provide value and work to earn your money and not feel entitled to it, or get it handed to you without effort, or try to cheat the system to get it. I love your point, and wish more people had that mindset.

It's worth noting that by injecting a politically charged viewpoint on compensation into the final argument all the comments except one focus on what qualfies as excessive wages rather than on your overall point which is sad to me because I think the point was great but the comments indicate that it got over-shadowed. Unless that is what you were going for but I doubt it.

Smithee · 2 months ago

I don't think it was all that political. I think everybody in Congress is a capitalist.

Financial Samurai · 2 months ago

I don't understand the belief why nobody "earns" $750,000? If you pull in $20,000,000 in revenue, is it so bad to pay your employ 3.8% of the proceeds?

Tiger Woods earns $100 million a year b/c he generates over $500 million in revenue.

Capitalism is what it is folks. The great thing about America is that nobody's stopping you in trying to make that big nut. Go for it!

Smithee · 2 months ago

Well, there are only so many individual tasks a human being can accomplish with one's brain and limbs, and there are also so many hours in the day. I haven't yet been able to imagine a combination of tasks and hours that deserves compensation of more than, say, $150,000 a year.

I realize that's a very logical view of things, and people get rewarded not just for what they literally do, but also for the revenue they generate.

My main point was that I never want to be the person who blindly chases a higher payday, no matter who gets hurt. If I were an executive at a big chemical company that was doing a lot of polluting, even if it was perfectly legal, I hope I'd either try to get them to stop, or seek work elsewhere.

Erica Douglass · 2 months ago

Wow, after reading this I realize you're serious. Many people who earn that much generate a ton of value for their clients. They help other people feel better, make money, or generally have a better life.

If you were to go to the emergency room right now and found out you had a rare form of cancer, the person you would "hire" to fix it would make far more than $150K/year. Are you seriously saying they are not worth it? To save your LIFE?

That's an extreme example, but the people who demand that kind of money are absolutely worth it.

-Erica

kitty · 2 months ago

"But as it is, we reward athletes (who we often find were cheating with steroids), and executives who don’t actually do much, aside from make plans, smile at clients, and otherwise increase shareholder value."

Also give you job. As apex said - try it.

It is actually quite simple - any job pays exactly as much as the market bears. I.e. if a company or organization can pay $X to get a good person to do the job, they pay that much. If they can't, they raise the prize. It's just supply-demand as with anything you buy. Food is more important for life than fancy jewelry, yet fancy jewelry costs more. Teachers' job is important, but a lot more people can do it than be an executive. How many people can be a sports star? A music star?

Also, as Financial Samurai says - nobody prevents you from trying to make it big. Frankly as a first generation immigrant who came to the US with absolutely nothing, and who experienced wealth redistribution first hand in the Soviet Union, I don't understand Americans' whining. Life is not fair, get used to it.

sam · 2 months ago

I think, like you the wrong people are rewarded with high salary. Instead a lot of the time we cut public spending and money goes from public sector jobs... giving bankers bonuses when they were a huge part in the current economic problems is rewarding people for making poor decisions. If I make a poor decision I will suffer the consequences financially and won't make money that month. I don't financially backed from the government - which is a shame but it does give me perspective and I am careful for that reason.

Craig · 2 months ago

I don't think it matters the advantage and does not hurt to have those advantages, it's great. I think the parents really help mold the attitudes for the kids and if done right, can have the same mindset even with being born with more financial advantages.

Steve in W MA · 2 months ago

Regarding your stated belief as to the morality or lack of morality of a given level of income, in many ways (I would argue, most ways) one's own personal wealth *nearly always* comes at the expense of someone else's. Just by the nature of your holding a job, you are preventing someone else who might have benefited from it from having it, thus it is at that person's expense. If you have managed to put yourself in the position of owning property that provides income, you have essentially claimed territorial and rights over something by legal means, which are protected by the legal apparatus and the state, which has the major right to use economic or actual force (fines or imprisonment) against someone who tries to take it from you. Which means that you yourself are using economic or actual force against that person by proxy.

In the end there is no source of wealth or income that does not either utilize or victimize someone or something else (animal or vegetable), or simply exclude them (again, through the concept of ownership) from the right to benefit or share in that income or benefit.

And, by and large, the more money you make, the more efficiently you using other people's work for your own advantage.

Note that this is a separate issue, is distinct, and does not exclude in any way the possibility that you may or not be producing a distinct value for someone through your profession or business activities.

Steve in W MA · 1 month ago

What the CEO does can *only* be done because of the existence of the small army of lower-paid workers that comprise the majority of the firm. Likewise, what the lower-paid workers earn is only possible through the direction and organization of their labor by management (and the CEO).

However, even though they are mutually interdependent, the CEO in America currently benefits disproportionally from his relationship to the firm and its employees compared to the benefits enjoyed by the vast majority of employees.