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Comment by jackmott42 | Hacker News Reader

It is a very odd discussion to have since, even when running a company well, no public company should be compensating its CEO to the tune of even 1 million a year. It is absolutely a ruling class leeching off society that this happens. It doesn't happen everywhere or even in america in the past, big companies can be run without this behavior. It isn't supply and demand, it is cronyism.

Should a CEO be allowed to get calls wrong, sure. Should they get paid 200 million when they do? No. Should they get paid 200 million ever? No.

Shareholders should be suing every company that does this until it stops, imho.

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Your argument is nonsense unless you can explain why you pick your cutoff point at $200 million.

Plenty of people in the USA would argue that $200k is a bad number: those overpaid software developers with their share incentives need to be stopped /s. Shareholders should revolt against those rich software developers?

> It is absolutely a ruling class leeching off society that this happens

I mean, the same argument can be made for US tech companies leeching off the world (or just leeching off USA citizens if you wish to be parochial).

A relevant simple thought experiment: what would you do if you won lotto?

> Shareholders should revolt against those rich software developers?

Of course they should. Hiring a few, strategic, expert developers at those rates might make sense. However, paying 200k+ for a newly graduated student with no experience should have been questioned firmly.

Yes, it would be much better for inequality if everyone's salaries were low and the trillions of value created in tech to go to a couple VCs, their LPs and their trust fund kids.

Some of that goes to workers with vested options too plus 401k and pension investors as well. Also, we are not talking about low salaries with the FAANG companies; the rest of the industry gets paid much less and noone is crying a river for them.

Maybe that newly graduated student provides more than 200k in value?

Ok, but did the company have to pay that much to get that same value? I saved a company from losing a $5 million dollar sale when I was 6 months out of university, but should I have received $5 million for my value? Plenty of other people could have accomplished the same thing.

Who are you to say what the company thinks is fair pay?

Aw thanks for asking. I am the all-knowing oracle of fair pay, but you can call me cudgy.

And yet Steve Jobs transformed Apple from 90 days to bankruptcy to the biggest company in the world. Was he worth $200 million in compensation? Hell yeah. Because he is responsible for that wealth creation.

This kind of turnaround also happened at Barnes & Noble, all due to one man - the CEO, James Daunt.

https://tedgioia.substack.com/p/what-can-we-learn-from-barne...

CEOs get paid a lot because they are crucial to the success (or failure) of a company. Yes, they did build it.

But even poorly performing CEOs get paid 100s of millions. Why?

Because they have a track record in the past of making highly profitable decisions. If you have a track record of doing a great job, you get a high salary offer. If you do a bad job at your new job, you still get paid the high salary.

Why do middle of the road quaterbacks get paid $35 million a year?

Shareholders gain by these moves too. Individually they gain less than the CEO, but they'll simp for them as long as it pays out. The free-market cannot control/contain these outsized compensations. Regulation/taxes would do a little better. Especially if USA returns to high-taxes on income/wealth.

Yes, the poor shareholders that don't work for their money should be given more of it. Tim Cook doesn't deserve any of the $2T value Apple created during his tenure... it should go to the trust fund kids.

Instead of complaining about executives earning so much, why don't we find ways for you and I to emulate their bargaining power instead?

Shareholders can sell there stock and I'm sure many did - that's how they send a message that they don't like the path leaders are on. Shareholders buy/hold/sell stock knowing the contractual obligations. As a shareholder, albeit a tiny one, I don't see how I'm harmed.

When you say CEO compensation isn't tied to supply and demand, what data do have to support that? We pay football/basketball/baseball players well more than 1M dollars. Do you think the impact between a good and mediocre CEO for a large company is less than 1M? Even tiny drops in performance due to decisions at the CEO level would cost millions at the biggest companies. As companies scale larger, bad decisions will cost more and more. I think a rationale case can be made that many of these CEOs are generating more value than they cost in compensation.

Some ICs/devs make 1 mil a year

Isn't it up to the shareholders to decide this?

It's mostly up to the boards' compensation committees. The board members are mostly C-suite themselves in their day jobs. Go figure. The power of the majority of shareholders is diffuse, except for large funds and activists: decision makers in both groups tend to be from the same high-compensation executive in-group - so they will not rock the boat.

You are replying to someone who is saying "I don't think it's good that things are this way" with "things are this way". I hate these kinds of comments. The other guy knows how it's not up to him to make this decision. That doesn't mean he shouldn't voice his opinion.

Do professional athletes and entertainers next.

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