The old socialist Dan Hoan would have smiled to hear his grandson speak at the annual stockholders meeting of J.P. Morgan Chase & Co. in April.Thus does the Milwaukee Journal-Sentinel begin a four-parter on the topic of CEO pay rising relative to that of entry-level workers.
Dan Steininger, head of Milwaukee's Catholic Knights insurance company, questioned how J.P. Morgan Chase chief executive William B. Harrison Jr. could be awarded $20 million in compensation last year, about 743 times the pay of an average worker in America.It's not just for the talking heads anymore. The Senate has taken an interest in the topic.
Calling such compensation "outrageous and indecent," Steininger's speech quoted J.P. Morgan himself, who once said no chief executive should earn more than 20 times an average worker's pay.
No socialist himself, Steininger has pressured companies across America on behalf of his company's mutual fund, The Catholic Funds, while arguing that overpaid executives lower profits and hurt stockholders. But like a true grandson of Hoan, Milwaukee's mayor from 1916 to 1940, Steininger wants to reclaim an America where labor and management salaries tend to rise or fall together.
The climb in compensation has begun to affect the pay of executives at hospitals, universities and foundations, as salaries there rise much faster than inflation. That's attracted the attention of the U.S. Senate's Finance Committee, which has discussed legislation to crack down on excessive compensation for non-profit leaders.No mention in the first installment of the role, or lack thereof, of the failure of the common schools to equip kids with the skills to demonstrate an aptitude for responsibilities beyond those at the entry level.
All this comes at a time when average Americans are seeing their raises chewed up by rising health care costs, their retirement plans diminished or dropped, and their jobs moving to low-wage countries such as Mexico and China. A 2002 Harris Poll found that 87% of respondents felt that executives "had gotten rich at the expense of ordinary workers."