As you might expect, I have received a little pushback from my recent post where I attempt to put Wal-Mart CEO Mike Duke's $23.2 million (2012) pay into perspective. One gentleman sees Walmart as a union-suppressing, tax-break-receiving institution unworthy of his, or, per his plea, his Facebook friends' business. Another understands that the CEO of the world's largest employer has to possess unique abilities, $23.2 million is, however, over the top.
$23.2 million is, undeniably, a very large compensation package. It is, in fact, 1,034 times the pay of the average Wal-Mart employee. Surely, such a number comes at great expense to Wal-Mart's staff. And, besides, who on earth needs that kind of money? I mean, there's got to be some law against such waste, particularly when it occurs at the expense of hardworking folks. Just imagine how much better off Walmart's employees would be if its board would cut its CEO's salary to, say, a million a year (of course that would deny its access to the pool of Mike Dukes and Doug McMillans [their new CEO] of the world). That would leave $22.2 million a year to be divvied up among Wal-Mart's $2.2 million employees. And since equality is what we're after, we should divvy it up, not by merit, but in equal shares. My, how better off all those hardworking folks would be with that extra $10 PER YEAR to spend. Which begs the question, is adding a mere $10 per year to each employee's paycheck worth the risk inherent in so limiting Wal-Mart's options? I don't think so.
Now, don't get me wrong: I honestly sympathize with the gentleman who complains about Wal-Mart's gifts from government (not so much with the other's "over the top" complaint). Wal-Mart is indeed run by profit-seeking---at all costs---capitalists. I wrote, just last year, with disgust, about Wal-Mart's dealings in Mexico, as well as its dealing to Senator Richard Durbin. But, you see, the issues that disgust you and me are anything but issues involving capitalism, they involve pure cronyism. Which---as this must-watch video from LearnLiberty.org illustrates---is forever facilitated by government.
Marty: I would very much appreciate your views on the Montenegro style economy (in Western Europe around Spain and Portugal). I understand all industry is owned by the people and the top executive cannot earn more than 3X the amount of the lowest wage.
ReplyDeleteHi Tony,
ReplyDeleteI've been busy the past couple of days, but have off and on looked for data relating to Montenegro. I wasn't aware of their cap on executive pay, and I can't seem to locate anything on it. I'm hoping you can forward me a link with that info. In the meantime, here's a snapshot of its key economic data as of this month: http://www.forbes.com/places/montenegro/
Not sure what you're looking for. From what I can glean, Montenegro's economy had performed relatively well prior to the financial crisis, however hasn't been able to find its way in the aftermath. While they're reportedly instituting market reforms, there seems to be a consensus opinion that they've more work to do. They currently rank 70th on the Heritage Foundation's (not my favorite think tank, by the way) Economic Freedom Index.
I believe I read somewhere that they have low income inequality. And of course that's perfectly fine, but I don't believe we'd have much luck empirically correlating that phenomenon to any economic success they've previously enjoyed. Also, the evidence offered up by those so concerned with income inequality (I'm more concerned with improving the fortunes of the less fortunate without regard to the pace of advancements at the top rung of the income ladder), is, candidly, the definition of dubious. Please take a few minutes and consider these competing presentations I posted in January of last year. Here's the link: http://www.betweenthelines.us/truth-economy/
Again, if there's anything you can send my way, I'd be happy to dig into it and comment further.
Happy Holidays!
Marty