This Ought to Motivate the Staff

There is an article on the CTV.ca site this morning which addresses a serious issue that will probably be ignored by all but a handful of activists.

The article, which was about compensation levels for Canadian CEOs, claimed that the highest paid CEOs had already earned an average Canadian employee's annual salary earlier this morning (at 9:46, to be exact). The figure, which comes from a study by the Canadian Centre for Policy Alternatives, was derived by taking a look at the 100 highest paid CEOs and then comparing their compensation to the average Canadian salary of $38,010. To get an even darker picture, consider the fact that the top 100 CEOs made the annual average minimum wage salary ($15,931) on New Year's Day.

I think it is a very telling piece of information. I think people should be concerned about the gap between the most and least successful performers in our economy, since relying on figures such as "average household income" skews the great disparities addressed in the article. What I don't understand is why more people are not concerned with the "winner-take-all" mentality of 21st Century capitalism.

I have no problem with the idea of fair compensation. I have no problem with the idea of "pay for performance". I have no problem with the idea that people who have invested their capital in a company should get a decent return on their investment. I do, however, have a problem with gross inequality of the sort that we are talking about here. I find it hard to believe that the top 100 CEOs provide so much shareholder value that they should get paid 150 times the annual salary of the average Canadian.

I know that people are sometimes worried about the future of this country's economy. We think about globalization and automation and increasingly scarce resources as potential threats to our way of life. Somehow, though, I think we are ignoring an even more important threat -- today's capitalism is inherently unfair.

We have become a culture that rewards its economic winners with a disproportionate share of the resources instead of making sure that there is enough for everyone. No wonder recent studies have indicated that the number one aspiration of teenagers is to become rich and famous.

Now I am not going to blame this all on highly paid CEOs -- over-rich, under-employed celebrities like Paris Hilton play their role, as do professional athletes who earn enormous salaries for playing games. The difference, however, is that most people understand that rich celebrities and elite athletes are aberrations. In effect, they have won the lottery of life. CEOs, on the other hand, are people who conceivably earned their positions through merit and hard work.

In other words, we could be them if we had the desire and the drive, and that is why ultimately we don't raise concerns about the gap between richest and poorest. Forget about factors like education, family connections, or corporate mentors. Forget about factors such as gender, ethnicity, or regionalism. Forget about the fact that even if they have and do work hard, it is difficult to quantify why they are worth tens of millions of dollars each year. And while you're at it, forget about the fact that they make enough money to pay one hundred people minimum wage and still have enough left over to live quite comfortably.