I disagree with the quoted statement, and my disagreement leads to your conclusion as a consequence, but not as a problem.
Leaving aside whether the different positions are better/worse, easier/harder, etc, the higher you go, the more influence your decisions have. The engineer, if he does his job well, might be responsible for a few features and best case, be responsible for part of the revenue, and worst case, waste the time of a few engineers. The director, being responsible for perhaps a whole product, is responsible for a large portion of the revenue, and can waste the time of several dozen people if he doesn't do his job right. The VP, responsible for lines of products, can waste the time of hundreds of people. And so on up the chain. As an engineer, implementing the wrong feature probably won't get you removed from your position. As a VP, choosing the wrong product line can definitely get you removed from your position. And this is in addition to the increasing need to be able to negotiate with internal and external stakeholders to get increasingly larger scope of things done the higher you go. It's high stakes, high reward, and that's why the compensation is higher for those who can demonstrate that they can make a significant dent in the bottom line.