It Pays (A Lot) To Be A CEO

Half Of America's Top Executives Make More Than $8.3M A Year

(AP)  A new Associated Press calculation shows that compensation for America's top CEOs has skyrocketed into the stratospheric heights of pro athletes and movie stars: Half make more than $8.3 million a year, and some make much, much more.

CEOs of companies in the Standard & Poor's 500 that filed proxy information in the first half of this year received a combined $4.16 billion in 2006, according to AP's formula.

The high cost of chief executive pay has drawn criticism in recent years as salaries rose, stock options paid off like lottery jackpots, and perks like chauffeured cars and private jets spread. Still, there are few signs of any investor backlash.

Yahoo Inc.'s Terry Semel, whose Internet company has lagged behind Google Inc. in profit growth and stock performance, led the pack with total compensation last year of $71.7 million, according to the AP formula used to analyze those filings.

That's more than 2½ times the $27 million in total compensation this year for the New York Yankees' Alex Rodriguez, baseball's highest-paid player, and higher than the typical pay of such A-list movie stars as Brad Pitt or Leonardo DiCaprio — $20 million, plus 20 percent of the gross box office take.

Semel was followed on the AP list by two energy industry CEOs, Bob Simpson of XTO Energy Inc. at $59.5 million and Occidental Petroleum Corp.'s Ray R. Irani at $52.8 million.

The top 10 earners were in disparate industries, but they all had one thing in common: They were paid at least $30 million each in 2006.

The Securities and Exchange Commission required companies starting this year to more completely disclose what they're paying their top executives. But the SEC's approach has been criticized for failing to provide useful figures for investors; the AP, in consultation with leading experts, came up with its own formula designed specifically to isolate the value of all compensation awarded to CEOs in the previous year.

Of the 386 companies in the AP list — those whose fiscal years ended after Dec. 15, and who reported by June 1 under the new SEC rules — only six reported their CEOs made less than $1 million last year.

The lowest paid was Costco Wholesale Corp. CEO James Sinegal, who made $411,688. But no need to shed tears for him: Sinegal also owns 2.4 million Costco shares, worth about $1.3 billion, and has options to buy 1.2 million more shares.

This year's expanded disclosure requirements also offer a much more detailed look at perks given to top executives. They range from multimillion dollar tax payments on behalf of executives to much smaller amounts for household bills, including home alarm monitoring.

A handful of companies, including Washington Mutual Inc., have stopped offering perks, and pay consultants say many more are likely to do so as boards think twice about the repercussions of seeing their largess disclosed in proxies.

The AP formula, developed with advice from pay consultants Pearl Meyer & Partners and Mercer Human Resource Consulting, adds up salaries, bonuses, perks, above-market interest on pay that is set aside for later and what companies estimated the present value to be of restricted stock and options awards on the day they were granted last year.

This differs from the summary compensation formula that the SEC requires companies to use in proxy statements. Some executive pay consultants say the SEC formula is of less value to investors because it includes expenses that companies recognize during the year for current and previously awarded stock grants.

That tends to overstate in some cases, and understate in others, the specific pay decisions boards of directors took during the year, they said.

[hypnotoad72]

And CEOs rely on investors... not customers who come back for more product.

[middleman8]

WHATS THE USE TO COMMENT ON CAPITALISM GONE AMOK?

[gkc99]

THESE PEOPLE DON'T MAKE ENOUGH MONEY--WE MUST IMMEDIATELY MAKE GEORGE W. BUSHIT'S TAX CUTS PERMANENT!

So what if a lot of kids don't have health care?

[frb01]

ridiculous

[bellal-2009]

What do these people really DO? I mean nobody can be worth that much money. Can't they hire 10 people to co-direct and pay them a couple million each?

[omega39-2009]

I say, replace them all with cheap immigrant labor, and let the sellout CEOs see what it is like.

[walt1944-2009]

When I was a kid, my father owned a "Ma & Pa" grocery store in the 1950's. When I worked in the store (which was a requirement, not an option), my dad always told me to be nice to the customers, because for every one you tick off, you just ticked of 12 or more of them.

Naturally, today, with CEO's making so much money, the business ethic today is, "Make as much money as you can and the customer be damned! If I lose a customer, I'll find another one to replace him!". Wasn't it PT Barnum who said that there is a sucker born every minute. One day, big business is going to run out of suckers!

[evq123]

What is most amazing about this is that Yahoo is not getting good results recently, their stock is very low and their sales are going down.

Because of this, I really don't understand why the CEO of Yahoo is getting a lot of money, if he is not doing correctly his job.

This amount of money can be given to CEOs of Google, Apple, and other companies that are really doing very good their job.

For example Steve Jobs is doing amazing work at apple, he is a man that really deserves to receive payments like this ones.

[mh4cbs1]

Is ONE BIG Corporate-Congressional-Lobbyist Revolving-Door PARTY!

They have been Waging Class Warfare against the Middle Class since 1980. When anyone even points this out the corporate-press accuse THEM of class warfare.

When will Americans WAKE UP and vote these Republicrats OUT!

Vote Green Party and at least you can sleep well at night.

[afinefolly]

do minimum wage get well soon feed the world first aid on the trail folk canvas more area than do techno savy get sick soon tax the world first strike on the trail folk?

[bloggerbud]

Can you spell, J-E-A-L-O-U-S?

All you whinners make it sound like every dollar these guys get is coming out of YOUR pocket. This is what happens in a free market. I wonder if you complain about Tiger Woods making $30M for hitting a little ball or Dan Brown making $70M for writing a novel. Ever wonder what the Pope is worth? How about the Queen of England? Guess how much a cardiologist makes. Stop complaining. If you want to make more go out and earn it.

Maybe we should all make minimum wage, huh?

[standlee5]

If you want to make more go out and earn it.Posted by bloggerbud at 08:58 PM : Jun 09, 2007

They don't earn it. They're the ones ruthless and mean enough to swoop in and gut and company and it's employees to increase the bottom line. They get paid for being the executioner.

[bloggerbud]

Oh sure Standlee5...

Some guy, out of no where just swoops in and decimates a company, all by himself. There is no Board, no oversight committee, no nothing. C'mon...

Have you even been an executive, taken an MBA class, bought a stock, read the Journal?

What world are you from?

[standlee5]

When they're charging fees left and right. Anything they can get away with in this de-regulated enviromnment. They get us coming and going on creditcard/bank fees, refi's, processing fees, you name it. Gutting pension plans and firing employees, replacing them with Hb1 visa workers, that's what these guys get paid the mega bucks for, scr*wing the public. That's what it's all about. Not one single solitary scruple in their being. So maybe they deserve their wealth because they'll spend eternity rotting in h*ll.

[standlee5]

Have you even been an executive, taken an MBA class, bought a stock, read the Journal?Posted by bloggerbud at 09:08 PM : Jun 09, 2007

No. No. Yes. Yes. Why?

[omega39-2009]

Have you even been an executive, taken an MBA class, bought a stock, read the Journal?...

Oh please, need I remind you that Bush has an MBA and is a former CEO, and we all know how his presidency has turned out.

[winnerindia]

For one to be competent, formal education is not needed. Bill Gates was kicked out of the university.

[bloggerbud]

I hate to tell you Standlee5 but that is what happens in a free market. Unfortunately we are not the USA all alone anymore. We have to compete with all those Asian countries that have cheap labor. CEO's do what is expected by their shreholders. If a company isn't competitive their stock plunges, if the stock plunges their worth plunges, if their worth plunges they can't afford to keep large payrolls. It is a vicious cycle. If CEO A doesn't do all the stuff you say, then CEO B will. It is a sad fact of how the economic playing field is leveling all over the world.

Look at Detroit. They make shi**y cars. They charge too much. They have Unions that gouge their own workers and pass the high prices on to consumers that, in turn, say Bite Me, and buy Japanese. It is not the CEOs Pal, they don't operate in a vacuum. The CEO answers to a Board and too the shareholders. If you want to vent, vent on them. At least get the right target in your crosshairs.

If you don't like credit card fees then don't use the card. If you can't afford that big screen TV, that fishing boat and that new pick-up, hey, maybe you shouldn't buy it.

I doubt they'll rot in hell. Every day for these guys is hell. A million problems all day long. Have you ever heard the expression, "you couldn't pay me enough..."? Try managing even 5 people - what a nightmare. Especially 5 folks like you with an ax to grind.

[afinefolly]

hmm, i wonder: k, consider a $300,000 3000 sq ft home on a 3/4 acre lot and replace with 14 340 square foot cottages for $60,000 each: the $300,000 3000sf home is now a $840,000 4700sf home. now, give those homes to customers or other folk, as if it were free email or a free web page: to attract customers who make a living canvasing area neighborhoods online and offline for the purpose of shopgifting not just yahoo, but yahoo's competition as well: in order to assist all parties by holding hands / weaving bouquets / song dance skit kit get well soon, you are here, why why why / recycling grass and dirt to educational props with accents, dances with jingles, arts and crafts, knicks and knacks / shopgifitng grass and dirt for cures for cancer and other margaritas ... when the market is healthy, the competition is healthy, and the entity is unavoidably healthy?

[bloggerbud]

Afinefolly...

What?

[jw218389]

I don't have health insurance and you made 71 MM Dollars in ONE YEAR???!!

Screw you ***!!!!!!!

[hypnotoad72]

bloggerbud - it is not competition when their local economies make the wages offered by America's corporations a goldmine. To them. The same wages, to Americans, is not quite so good. Because our cost of living is more.

And another reason why it's not competition: It's migration.

Indeed, for all the whining people make over Dell's bad product quality, Apple's awful India helpdesk support and numerous other examples, the jobs aren't coming back here where we (had) competent personnel.

Until America's local economy is globalized to match India's and China's, I just cannot believe we're competing with anybody. It's about greed.

One other thing - Michigan's cars. Is it solely the assembly that's awful? Or the PARTS? Where do the parts come from? China? I wish it was as simply as bashing the USA so readily. It isn't.

winnerindia - Gates was also arrested in 1977 for a charge that has since been "lost". Funny, that... And he's shrewd. In a business sense.

[standlee5]

Posted by bloggerbud at 09:23 PM : Jun 09, 2007

Fine, then they can take their stressed out azzes and their American worker backbreaking corps. and move tehm to India. S.c.r.e.w. them. We will fill the void with our own small businesses. F.them and F. people like you who care not about the avg. American.

[standlee5]

Every day for these guys is hell. Posted by bloggerbud at 09:23 PM : Jun 09, 2007

Oh gee, boo frigging hoo, at over a mil. a week I think they can handle it.

[hypnotoad72]

standlee5 - with the rise of big box stores that also happen to do services, look at things from a customer's perspective: Supporting a local store that's gonna cost money, or going to the big box brand who has the name and presence and can charge less because they have numerous locations throughout the nation and therefore has the power to set prices? Regardless of the quality of the service or product, we both know people will go to the entity that costs less.

The sad part is, the big fish can eat all the little ones. It then has to eat itself in the end after all the little ones are nothing left than disintegrated bones. It's not a very bright way to run a society, but nothing's perfect... Once big biz is done with us, and decades down the road when they take a leak on India's and China's populations as well, hopefully we'll be intergalactic so we can go offshore to Calufrax...

[standlee5]

I hate to tell you Standlee5 but that is what happens in a free market. Posted by bloggerbud at 09:23 PM : Jun 09, 2007

No, that's what happens in a de-regulated, profit at any cost, demoralized, illegal, govt. approved,greedy free for all.

[standlee5]

Posted by janem4 at 10:20 PM : Jun 09, 2007


Jane, I wouldn't give a rat's azz how much they made if I knew they weren't raping a pillaging, gutting pension plans, hiring illegal labor, taking companies into bankruptcy to scr*w creditors, feeing consumers to death and union busting. They've not proven themselves to be fair to the American worker many of whom have built and whose families have built the very companies they're ravaging.

[l8c6]

I hate to tell you Standlee5 but that is what happens in a free market. Posted by bloggerbud at 09:23 PM : Jun 09, 2007

This is perverted rhetoric. So how about free football games, no rules, let's watch the players literlly stab each other in the backs, spill some blood, spray bullets on the field to score a touchdown then. Hell let the sociopaths run amock because it is them who "win" in this "free" market society.

[acauble1]

The "FREE MARKET" has cost, and will continue to cost this country BILLIONS OF DOLLARS....

...in trade deficits

...in health care costs

...in job losses for both skilled and un-skilled laborers

...in energy costs

...and most of all, the long term health of this planet's environment that will have to be suffered by this generation's children, grand children, and beyond (for those who care, which is sadly too few).

The biggest oxymoron in the english language today:

FREE MARKET

[jvman4u]

...and often we "the little people: pay more taxes, and pay again with low wages and poor hygiene work environments and little to no support personnel. Just forget it people, there is NO AMERICAN DREAM anymore unless you are: 1. in another country 2. here illegally 3. Paris Hilton....

[hypnotoad72]

acauble1 - I think the dream is dying, or considering how people have been told over time how new fields would show up for US workers, or the varying excuses made for opening up more H1Bs, and so on, never mind the obvious bit about how making America competitive in a global world means making the cost of living to match the cost of living in India and China, which is why the wages being offered to their countries is a godsend while it's kinda difficult to live on them here.

Why aren't there answers? It is NOT about retraining because other news articles are saying how it costs ____ less to do it in ____. They're avoiding the core problem: Cost of living in America, along with the wages, is why America is losing its competitive edge. If anybody is truly being serious about wanting to make America competitive in a global environment, then it's d@mningly obvious what has to be done: Equalize the costs. Until then, who is going to spend a large 5 figure loan (or more) for education to get a job that pays a smaller 5 figure income that would likely be offshored because it could be done in a cheaper country anyway?

Something isn't adding up. President Bush isn't responsible, but even he knows "retraining" isn't the solution. More and more types of jobs are seen as being able to be offshored. It hasn't happened yet but it's going to if the CORE problems don't get fixed. And that's what President Bush CAN do.

[evq123]

What is most amazing about this is that Yahoo is not getting good results recently, their stock is very low and their sales are going down.

Because of this, I really don't understand why the CEO of Yahoo is getting a lot of money, if he is not doing correctly his job.

This amount of money can be given to CEOs of Google, Apple, and other companies that are really doing very good their job.

For example Steve Jobs is doing amazing work at apple, he is a man that really deserves to receive payments like this ones.

[itgranny]

Capitalism has one major flaw. In theory it works right up until you factor in the greed of the people in charge. The money accumulates at the top and doesn't trickle down as its supposed to.