Dreier responds to blog post on salaries

  CEOs
of the 500 large corporations that comprise the Standard & Poors
500 index had an average compensation of $8.5 million in 2009 (the
latest figures available), according to the report, “CEO PAY and
the Great Recession”  by the Institute for Policy Studies.

  CEOs
of major U.S. corporations averaged 263 times  the average
compensation of American workers.

 
CEOs at the 50 major
firms that have laid off the most workers since the onset of the
economic crisis took home nearly $12 million each on average in 2009.
For example, while Disney Corporation was laying off 3,400 employees,
it paid its CEO, Robert Iger, $21.5 million.  Verizon’s CEO Ivan
Seidenberg was paid $17.4 million even though the company laid off
21,308 employees.  Obviously there is little correlation between
CEO compensation and a company’s track record in creating jobs.

  According
to a July 11 newsletter, “Eye on the Market,” published by JP
Morgan Chase, the large financial corporation, profit margins (the
share of a company’s revenue that goes to profits) of the Standard
& Poor’s 500 companies are at their highest levels – close to
13% of company revenues — since the mid-1960s.

How
is it possible for companies to be making huge profits and their CEOs
earning excessive salaries in the middle of a deep recession?

According
to the JP Morgan Chase report: “US labor compensation is now at a
50-year low relative to both company sales and US GDP.”

Michael
Cembalest, the chief investment officer of J.P. Morgan Chase, is
quoted in the newsletter saying that “”reductions in wages and
benefits explain the majority of the net improvement in [profit]
margins.”

I
don’t think that public servants should earn the outrageous
salaries paid to many corporate CEOs, even though what they (the
public servants) do is more difficult and important. But if the
richest 1% of the population (which includes the CEOs and top
executives of the largest companies) were paying their fair share of
taxes, we might have enough revenue to pay for first-rate schools.

So,
let’s have some sense of proportion. The Superintendent of PUSD -
in effect, its CEO – has responsibility for running a large,
complex institution, under incredibly difficult fiscal conditions,
whose success or failure will shape the future of our community and
the lives of tens of thousands of young people and their families. 
In that context, and in comparison to what private sector CEOs earn, 
it seems that Gundry’s  $240,000 salary is a bargain.