Comment by ctvo | Hacker News Reader

Comment by ctvo | Hacker News Reader

> Jassy's executive compensation package, which is tied to Amazon stock price and mostly delivered as stock awards over a multi-year period, was $212 million in 2021.

They used "multi-year" here over the actual timeline: 10 years. It sounds a lot less outrageous that his pay is heavily based on the stock price and comes out to be ~21 million a year as the head of one of the largest tech companies in the world.

Here are the details:

> Virtually all of Jassy’s 2021 comp — $211.9 million — was in restricted stock that vests over the next 10 years, according to Amazon’s proxy statement filed Friday. His base salary was $175,000, unchanged from the two prior years; in addition, Amazon paid $589,149 in security expenses for the CEO.

From Variety https://variety.com/2022/digital/news/amazon-andy-jassy-2021...

Edit:

> The Amazon board’s compensation committee said in the filing that it intends for Jassy’s stock award, which vests through 2031, “to serve as a long-term incentive for Mr. Jassy, and, accordingly, believes it should be viewed as compensation over the 10-year term and not solely as compensation for 2021.”

Doesn't sound like he'll get too many more RSUs yearly.

The award is for 61000 shares, which would have been worth $212M as of the 12/31/2021 share price. It's worth far less now.

Quite frankly, this is as sensible of a comp package for a CEO as one could propose. Compensated in primarily in equity with a long horizon for vesting. If a company wanted its executive to be aligned with the interests of its shareholders, is there really a better structure?

Aligning the incentives of the CEO to the incentives of shareholders by awarding the equivalent of an 0.012% ownership stake seems reasonable to me.

That $212 million was starkly contrasted by the next point in the article, that Warehouse workers typically make $15/hr. It would take about 7,000 years working that wage (full-time) to make the same $212,000,000. It's still a _huge_ gulf, whether the CEO's compensation is in one year or one decade.

Right, but if you were to take all $212 million and divvy it up to the nearly 1 million US Amazon employees it wouldn’t go very far.

I see this theme a lot when this topic comes up, and I feel it misses the point.

Does the CEO provide 700x the value (based on $21.2M / 2000 hrs = $10600 "hourly rate") of a warehouse worker earning $15/hr? They absolutely provide critical input and decisions at the helm of a large ship, but if you break down their input versus the input of everyone under them...is it actually such a huge disparity of mental and physical effort to warrant a 700x difference in pay?

Secondly, if the company wasn't spending that much on CEO compensation, the money could go plenty of places beyond sprinkling pennies at warehouse workers. Infrastructure investment, product development, or other ways to grow the business. Employee wellness programs, crisis/hardship assistance, etc to support the workforce.

Looking at it as only CEO salary divided by employee count is a very limiting perspective that ignores a lot of potential ways that pile of money can be used besides making a very rich person a bit richer.

For a penny an hour by a CEO who performs 400x that of an average Amazon employee, that’s a bargain.

Your dreaming or delusional if you think a CEOs output is 400x someone else's. Dangerously delusional.

CEOs simply control more powerful tools so their output is multiplied. Someone driving a tractor might produce 400x the output of someone with hand tools, but its not because of the person, its the tool. Swap the two people and there will still be a 400x difference in output. It doesn't mean the tractor driver, or business leader is some sort of outlier genius.

Finally someone sane. It’s not about stacking 400x boxes- it’s about force multiplication and impact

By that metric, world leaders ought to have billion dollar salaries.

CEO is about driving a PERSON (of which a corporate entity is also a US person) and can literally direct the corporate into any direction.

A political leader is constrained by numerous laws. No, they do not deserve billions of dollars.

Right. Just like the CEO, a fair amount of people could theoretically drive the tractor, but few have the experience. If you let the wrong person drive the tractor, they might just drive it right in to a river.

Eh your only focused on output from CEO end for estimates and your not doing it well. As mentioned by someone earlier I think the numbers were what 7000 years before a worker on 15 an hour doing 10 hours a day can equate to the 212 million pay packet mentioned? CEO wage is way out of proportion. The CEO doesn't provide 7000 years worth of min wage labor output over his 10 year pay package. Your cooked if you think it's even close.

CEOs can be replaced by algorithms largely. And society will be all the better once they are. Their job literally is just decision making based on input and output of information.

I would be willing to bet the CEOs of these ultra-large, ultra-powerful tech firms provide far more than 700x the value of their average worker.

> I would be willing to bet the CEOs of these ultra-large, ultra-powerful tech firms provide far more than 700x the value of their average worker.

This assertion is amusing given this ultra-powerful tech firm has been systematically wasting resources to ensure their employees are both worked to death and not paid even a living wage.

Eh I'd bet you could train just about any worker to do the role of CEO because it's barely work at all. Source shovelling sand all day is 1000x more difficult than sitting in an air conditioned space hypothesizing about bs and making a bunch of decisions. Have done both. Running a company is in no way as difficult as being on the tools. Come do a days labour for me concreting and tell me your CEO works harder. Come do 13 hour shifts of a drill rig lifting 16 ton of steel by hand and tell me your job as a CEO is harder. Lol you'll die from exhaustion in one job and maybe get slightly disgruntled in the other.

Do you believe modern corporations are 35+ times more complicated than the corporations in the 1950s when CEO to worker pay was 20-1?

https://en.m.wikipedia.org/wiki/Wage_ratio

I bet there are far more than 700 people that can do the warehouse worker's job for every 1 that both can and is qualified to do the CEO's job.

The point of that theme is primary to point out that the worker's wages aren't low because of the C-level pay. The worker's wages are low because almost anyone can do their job.

Amazon has 950,000 of those warehouse workers. If you completely zeroed out Jassey’s stock $212 million stock award and instead distributed it among those workers, their hourly rate would change from $15 / hour to $15.01 per hour.

You're off by an order of magnitude, but the point still stands. Assuming 2k hours a year, the pay would raise by about $0.11/hr per warehouse employee or about $223 per year per employee.

The $212 million is over 10 years, so there is your order of magnitude.

Ah, good point. Thanks for correcting

$223 is significant for a minimum wage worker. Whereas these millions are a bucket in the ocean for the CEO. I see it as nothing less than narcissistic supply for the CEO.

My calculation was wrong because it's spread out over 10 years. So it's really only about $0.50 extra per week. Plus, they are making 2x minimum wage. I'm not claiming that is either adequate or not, but they shouldn't be characterized as all "minimum wage workers." (locality dependent, for sure).

I often hear this and let me just pose this question...

Damn near everyone in America, at least, has access to YouTube or other streaming services. I learned how to program in R from The Teaching Company Plus' (now Wondrium)'s "Learning Statistics: Concepts and Applications in R". 24 lectures. 12 hours of content. Resources available for download. It was the springboard that allowed me to seek out deeper resources and expand my knowledge. Total price, $10.81 for a one month subscription.

You can probably find a lot of equally good free courses at other websites.

My point being this. The information is out there for people willing to seek it out. I came up poor. Really poor. Like, we're having mayonnaise sandwiches tonight for dinner poor. And if you're wondering what's in a mayonnaise sandwich, it's in the name. Mayonnaise. Bread. Period.

Now maybe we need to cultivate a sense of curiosity in our students, so even the ones who end up as warehouse workers at an Amazon can one day aspire to something greater, but at some point, people have to take some responsibility for how their own lives are turning out.

It's really easy to point the finger to society, to the government, to the person next door to you, but at the end of the day, most people have the tools (smartphones, cheap laptops), and they absolutely have the time. But the drive is something that no government program or no private initiative can give them - that you have to pull out of your gut yourself. And if you can't do that, you're doomed to a life of mediocrity.

Choose your hard.

> Damn near everyone in America, at least, has access to YouTube or other streaming services. I learned how to program in R (...)

Enough with this pseudo-moralistic perpetuation of abuse, specially the tone-deaf ones based on survivorship bias.

Just because someone is not able to win the lottery that does not mean they have no right to earn a living wage that allows them a honest living.

Aren't we supposed to live in a civilized society? Why are you unwittingly normalizing exploitation and the widespread abuse that bars the majority of families from having a decent life? If not for the parents who can't be self-taught engineers, why not for their children? Are those also expected to endure hardship?

Just pay people a fair wage. Is it that hard?

> Just pay people a fair wage. Is it that hard?

Yes. Because we have no idea how to define 'fair'. I hear 'fair wage' over and over but no one can ever explain to me what makes the wage 'fair' other than, "I have a job and I should be able to live on that single job!"

Okay... why? Where is it written that you should be able to live on a single job?

As soon as you can come up with an argument that's not emotive, and is instead quantitative, I'll listen.

Right now, all I hear from people parroting this is that, "It's not right!"

> Okay... why? Where is it written that you should be able to live on a single job?

> As soon as you can come up with an argument that's not emotive, and is instead quantitative, I'll listen.

I have a feeling that you will not accept any argument based on general morality as you would describe it as 'emotive'.

I think first that humans should not spend the majority of their lives working and sleeping. In other words: surviving. Especially when there are more than enough resources available to achieve this ( in your country).

Second, exploiting other humans (as above) is absolutely wrong.

These two arguments are not emotionally driven.

> Yes. Because we have no idea how to define 'fair'.

Well, we do. I mean, we have a pretty solid idea of what represents the absolute bare minimum. For starters, minimum wage should be a living wage. It should be enough all on its own to meet living expenses, including paying for a modest apartment, without breaking any effort rate limit.

Is this too hard?

Are we supposed to pretend that some people simply do not have a right to have a decent life?

> . I hear 'fair wage' over and over but no one can ever explain to me what makes the wage 'fair' other than, "I have a job and I should be able to live on that single job!"

Why exactly do you have a hard time understanding this?

Look at yourself. Look at the living expenses you have, specially the basic necessities. You pay for the roof over your head, for the food on your plate, for the clothes on your back. Do you have a hard time quantifying that?

This is even simpler than that. Landlords and banks already use the concept of effort rate. They already know that if someone's effort rate goes beyond 40% then they are at a significant risk of financial distress. Is it too hard to start from there and determine what's a living wage in any region?

Or is there zero lack of interest, and a desire to pull the ladder out of your own feet to screw everyone less fortunate than you?

So… your point is that “anyone can become a developer that pays good money”? And this is a solution for systemic poverty and classism?

Who do you think keeps society and your life functioning while you sit in front of a computer and code?

My point is that anyone can learn what they want to do on YouTube.

I served with an Electronics Technician in the Navy who started watching YouTube videos on commercial HVAC and now he does that as a living, servicing mostly restaurants in the Fort Worth-Dallas Metroplex, and not just making a "living", but last year his one-man operation made $300,000.

Not too shabby for just watching YouTube and going to get the necessary certifications.

Do you want to make the best pizza on the planet? There are YouTube videos out there from chefs all over the world, freely giving away their recipes. All you gotta do is pick up the ingredients and get started.

If someone wants it bad enough, they'll go get it, they won't wait for it to be handed to them.

And what if the thing you want to do pays a wage below livable? Or no wage at all.

Not everyone wants to be a software developer or something that makes a lot of money and it's a damn bleak view of the world where the grand diversity of the human race is squashed into a profit-chasing monoculture of workers. Just throw away your dreams and install air conditioning. It's the will of the market.

We've gone from the Renaissance ideals of being well rounded and interesting people to being the best single purpose cog in the machine, devoid of any values except making money. What a depressing attitude when we could just focus on treating people fairly and with respect whatever their choices.

"We" haven't gone anywhere. If you have to work now, you would have had to work just as much in the Renaissance. Those ideals were by and for independently wealthy aristocrats. The working class has always and will always work. If you're willing to have the quality of life that a Renaissance working class man had, 15/hr is plenty.

“We’ve always subjugated and mistreated the working class” is not the win that you think it is.

The working class has never had it better than they have it right now, except for a brief period of a few years in the mid 20th century. You wouldn't know it though, from all the complaining. Sure, society "should" keep improving, but in the meantime there's plenty of ways for someone to improve their situation, and none of those ways involve complaining about rich people.

Do you mean they get to enjoy the fruits of modern life, and hence shouldn’t complain? Again, that’s not a valid argument.

Let’s use some data, for example wealth distribution (1) - the lower classes have stayed lower income, and the middle class is rapidly transferring wealth to the upper classes. How is this sustainable?

(1) https://www.pewresearch.org/social-trends/2020/01/09/trends-...

It's not an issue of data. Wealth inequality by itself doesn't do anything bad, if the bottom can still afford what they need. It's a matter of having a realistic mindset and sense of self determination. A poor person today in the west has it drastically better than any poor person ever in history; they have a better quality of life as a poor person, and they have mind-bogglingly high levels of income mobility, in a historical sense. No other time in history could someone so easily go from poor to middle class.

So when people spend so much mental energy complaining about how things aren't "fair", okay, sure, but you could instead just improve your situation. There will always be poor people, but an individual will not always be poor. We are not yet anywhere close to a situation where the highest expected value of an individual's time is to complain (instigating revolt).

Look, this is really a pathetic line of argument. If you’re selling self-help books, sure go ahead.

This discussion is about minimum wage, wealth gaps, and relative compensation of CEOs. You do realise that? If you think everything is perfect, feel free to ignore such threads. The status quo exists and doesn’t need your support.

Saying that working class people can just work harder and get higher paying jobs, doesn’t solve anyone’s problem. In fact, it only furthers the problem that only some jobs get a living wage, and even fewer jobs get a good wage.

I have no idea why you think it’s okay to tell poor people to “just improve their situation”, and contribute both their/our tax money towards enriching the wealthy.

Sorry, but no, I will comment my views as I please, whether they support the status quo or not. As this is a public forum, you'd do well to find a way to cope with differing views.

I was poor. I improved my situation. I didn't spend much time complaining about rich people on the internet, because that would have detracted from the time I taught myself marketable skills for 8 hours a day, every day, for 7 months, while delivering pizzas and living in a shithole with 3 other people. You're right though, complaining would have been much easier, but somehow I don't think I'd still be making a quarter mil if I had taken that route.

"Pathetic" to recommend people work hard and fix their life? That sentiment itself is what's pathetic. The world doesn't owe you shit.

I don’t believe the working class is sitting on HN and complaining - it’s mainly people like us who spend exorbitant taxes on a system that doesn’t actually help anyone. It’s not clear to me if you understand this nuance.

Anyways, your repeated “I got mine, fuck you” mentality is very boring and toxic - https://www.theguardian.com/commentisfree/michaeltomasky/201....

Good luck, happy that you solved poverty! I’ll stop engaging as this thread will lead nowhere.

The working class is absolutely sitting on Twitter and complaining. It's sad that you view advice to improve yourself as a toxic "fuck you". Is your locus of control so far externalized?

Okay, but if “everyone” goes out and gets a high paying job, who is leftover to do the jobs that keep us all functioning? Should we just mistreat them because they didn’t watch enough YouTube and “upskill” themselves?

So the solution is to chase whatever the market dictates as "well paying", despite being against your interests, maybe drop whatever responsibilities you might have or just, like you say, live in mediocrity, if your socio economic situation forked your chances from the beginning, and your inherent abilities just don't cut it? Do you walk by the less fortunate, and think, they just didn't work hard enough and "kind of" are at fault for their own situation? Because that's a very typical American way of thinking, one that people adapt in America to cope with the poverty around them. I've seen it, from aquinteces who became big, moved to America, and slowly changed their view of people to cope with their suffering and their own fortune, partly due to a really badly made social system. And unfortunately, there are plenty of places like this besides America.

But does he get another 200M package that vests over ten years next year?

Assuming that Amazon's executive compensation continues to function as it has for the last decade-plus, no.

And does he still get the 2021 package if he doesn't continue working in that role for the following nine years?

Generally that isn't how RSU vesting schedules works. You only keep what has already vested if you leave.

For a CEO with a $200M package, everything is negotiable and would depend highly on the mode of departure.

Hah sounds like a lot of HNers have Andy Jassy beat on base salary

I’ve always wondered how this works- sure these folks are already personally wealthy, and they have large stock portfolios, but the mechanics of tapping into that for liquidity is interesting to me..

Say an exec makes Jassy’s base and has a large equity packages. Do banks feel comfortable writing loans against to-be-vested RSUs? I’d imagine they count RSU vesting as heavily discounted future cash flow.. but not sure.

Plus there is significant volatility in the actual value they bank at the end of the day- sure, speaking on normal terms having an equity package fluctuate at this scale isn’t significant to an individual’s finances, but might be to a bank underwriting, say, a recent Snap exec’s loans…

Reply on news.ycombinator.com