Well, this is a trend that continues unabated by the reality most Americans face. I’ve written about this before on this blog, and I’ll state it again: There is a tremendous redistribution of wealth going on in this country, and all that money is going to the the richest Americans. It does not bode well for this nation as a whole, but there is absolutely no momentum to reverse this trend and institute policies that would help ensure a more equitable distribution of wealth.
The current fervor to cut taxes and reduce government spending — especially on social services and education — only worsens the divide between the richest 10 percent and the vast majority.
This is an excerpt from a blog by Edward Lawler III atForbes.com:
Last year, executives were showered with pay of all types – salaries, bonuses, stock options and stock grants – but the biggest gain came in cash bonuses. Needless to say, most employees of large organizations did not experience the sizable pay gains that executives did in 2010. All the while, layoffs continued and most corporations tightened their budgets across the board.
There is another trend worth noting. The pay difference between the top and the bottom in large corporations has expanded tremendously since the early 1980s (roughly speaking, it has gone from 100 to 1 to 500 to 1). Some steps have been taken by the government to limit executive pay, most notably mandated shareholder advisory votes on pay programs. However, so far there is no evidence they have made an impact. The new normal with respect to executive compensation appears to be very similar to the pre-recession normal. And it’s just not sustainable.
Numerous critics of executive compensation have raised concerns with respect to sustainable organizations and societies when there is a large difference between the best and least well-paid members. The drop in executive pay that occurred in 2008 and 2009 offered the opportunity for corporations to reduce the pay difference between the top and the bottom. 2010 was a window of opportunity to show some restraint in the amount executives are rewarded for improved corporate performance. By giving smaller bonuses and less stock, organizations could have reduced the pay distance between the top and the bottom.