Corporate Salary Insanity
Sep 04, 2007
Just how high can corporate salaries go? A new joint study by the Institute for Policy Studies and United for a Fair Economy indicates that the top U.S. private-equity fund managers were paid more for every 10 minutes on the job in 2006 than the average U.S. worker earned in the entire year. Data for the study came from the U.S. Labor Department and Forbes magazine.
The highest paid fund managers averaged annual salaries of $657.5 million (US), which is 22,255 times the U.S. average annual salary of $29,500. That works out to about $35,100 for every 10 minutes of work, assuming a 60-hour week. Even in contrast with the top 20 salaried officials in the U.S. government’s executive branch – which includes the president – the same managers were paid 3,315 times the average income of this group.
In contrast, workers at the bottom rung of the U.S. economy have just recently received the first federal minimum wage increase in a decade. The new rate of $5.85 still stands seven percent below where the minimum wage was a decade ago in real terms, however. CEO pay over that same period of time has increased by approximately 45 percent.
And even the highest-paid European managers make nowhere near as much as their American counterparts. The study finds that, in 2006, the 20 highest-paid European managers made an average of $12.5 million (US), which is only a third as much as 20 highest-earning U.S. executives.
The study concludes that, instead of shaming corporate America into getting salaries into line, it is likely that these exorbitant salaries will only contribute to the continuation of gross overpayment. It proposes several options for change, including the elimination of tax subsidies for excessive CEO pay, making sure investment fund executives pay their fare share of taxes, and an increase in the top marginal tax rate on high incomes.
The full report can be accessed at www.nupge.ca.
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Since these fund managers are making stupid amounts of money, why don't we all just stop investing into them. I imagine the money would dry up fast if that happened. They are all ponzi scams anyway.
pissinginthetent.com - 2007-09-06 20:48