Almost every day, you hear another story about some CEO who just got paid $300 million for doing a tiny amount of work. Or no work at all. One guy got $500 million for retiring. Think about that: He got $500 million for the work he’s not going to be doing. Last year, three hedge-fund managers took home over $1 billion apiece. That’s billion with a B.
At first, like everyone else, I thought, “That’s crazy, no one is worth that kind of money.” But then it was explained to me by a 30-year-old billionaire hedge-fund manager on television that it just sounds crazy. It’s really OK, because that $300 million, that $1 billion is going to trickle down to you and me. That CEO is going to buy a house and clothes and cars for himself and his wife and his children, and all that money will get spread around to people who make the cars and the houses and the clothes. It’s really good for everyone, see?
And sure enough, that CEO bought not just one car, but several. A Maserati Gransport. And a Lamborghini. And that money trickles down to us every time an Italian auto worker vacations over here and stays in a Swiss-owned hotel and tips the maid. And that maid will spend all of her minimum wage money right here. Good deal, huh?
And that CEO did buy a bigger house, and he hired people to build that new house and paint the new house and decorate the new house and make fixtures for that new house. In Tuscany. And his other house in London. And a $22 million apartment on the Avenue Georges V in Paris.
And because they have a pad in Paris, that CEO’s wife will spend plenty of money on clothes. In Paris. Putting designers and dressmakers and sales clerks to work. In France where she flies once a month, first class. Spending tens of thousands of dollars on each trip. On Air France. And some of that money she’ll spend on short-term parking at the airport, and we all know how expensive that is. She may as well be stuffing hundred-dollar bills in our pockets the way it’s trickling down.
She’d like to bring the kids with her, but Stepanie’s on safari in Kenya. And Brad’s mountain climbing in Patagonia before he goes off to Oxford.
I’m not an economist, so I can’t give you the technical explanation for it, but a CEO’s money trickles down, whereas if he took less and paid his workers more, it wouldn’t. Only CEO money trickles down. It’s a well-known fact that workers will just waste any money they make on food and medicine. Or throw it away on clothes for their children. And most of that is spent right in the towns where they live. What a waste. That money’s got no place to trickle down to. It already is down. It can’t help anyone.
But there is trouble on the horizon for our hardworking CEOs. Some people, I won’t say who, communists probably, think our CEOs get paid too much and want to replace them with cheaper, less costly CEOs. From Mexico. It turns out Mexican CEOs are willing to work for five, 10, sometimes even 20 times less than our own CEOs.
While a CEO here may easily get $250 million a year for running a big oil company, in Mexico, that same job may pay only $5 million or $10 million. Before you know it, this country will be overrun with cheap CEO labor. Soon, you’ll see guys in expensive suits standing on street corners carrying signs that say, “Will run Exxon for $2 million a year.
We may not make anything in this country anymore, but at least we can say with pride, “We have the most expensive CEOs in the entire world!”
Jim Mullen is the author of “It Takes a Village Idiot: Complicating the Simple Life” and “Baby’s First Tattoo.” You can reach him at firstname.lastname@example.org
Copyright 2007, Newspaper Enterprise Assn.