By Maxine Shapiro, KERA 90.1 business commentator
Dallas, TX – I believe the time has come. We as a democratic society in a free enterprise market need to deeply look at our value of work and how much we get compensated for it. I'm Maxine Shapiro with KERA Marketplace Middays.
Yesterday it was reported that Jack Welch, ex-CEO of General Electric, the underwriter for Marketplace Middays, received such an exorbitant compensation package that the day before it was rumored that the SEC would be looking into it, the board of directors took some of it back. The questionable part of the deal? Stockholders were not told the extent of the package.
Last week, Ex-Tyco CEO Dennis Kowslowski and former chief financial officer Mark H Swartz were charged with stealing more than $170 million from the company. They're accused of defrauding investors by falsifying business records to conceal the compensation and loans they were receiving from Tyco.
Now I'm not going to bother reciting a laundry list of items Mr. Welch received. He did nothing criminally wrong. Nor will I tell you what the Tyco boys bought with the money they allegedly took from the company. There are those that are in search for one or two or ten people to blame. But you know, it's really all of us.
Last week, New York Fed President William McDonough cited a study that found the average chief executive officer's pay has gone from 42 to 400 times that of the average production worker in the past 20 years. Mr. McDonough said, "I can find nothing in economic theory that justifies this development."
It's not economic theory. He's right. Thirty years ago when I left college, maybe to a fault, making money was the last thing on most of our minds. And then the pendulum swung. Making money, lots of it, was all anyone thought about. And how comfortably could we live. We even changed the definition of 'comfortable' to fit our goals. Maybe that pendulum is ready to settle somewhere in the middle. For some of us, it's being forced to. For KERA Marketplace Middays, I'm Maxine Shapiro.
Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 p.m. To contact Maxine Shapiro, please send emails to mshapiro@kera.org.