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 Ensis Ferrae wrote:

 Grey Templar wrote:

It is beneficial if a company's employees aren't struggling, but if it would actively hurt the company to help then they shouldn't be forced to do it. CEO salaries are really small beans comparedto salaries overall. You will never get any meaningful across the board salary increases by limiting CEO salaries.

There most definitely IS something wrong with a company that says to it's employees: "If you're not making enough here, get another job, or get welfare benefits. Ohh hey, look what I found: it's a copy of a welfare application, you want this one?"


Even then, with the numbers that others have posted for CEO Salary at one company (the $25MM per year), every single article that I've read on the subject has flat out said that when these people get into that kind of money territory, you're actually looking at someone who's just hording that money, and is making probably triple that (as in, 25% or less of their annual income is that "salary" provided by the company they head) in stock investing. Yeah, that CEO pay might be "small beans" to the company, but you really aren't hurting that "CEO" by cutting their pay



Many of the arguments that I'm seeing here, and usually see from right leaning folks, is that Rockefeller was right, and earned his money fair and square, so we should all be so happy that these rich folk are so kind and benevolent as to give us a scrap of "their" money, and because we should be happy, we need to shut up about how fethed the situation is.

So if there is no good reason for cutting CEO salaries, why do people keep insisting that this get done? And proposing absurd ideas of legally capping income.

Let the fat cats have their money, going after them is political grandstanding and nothing more.

 Dreadwinter wrote:

I have read all the posts. If they do not like what they are getting paid, they can find a new job. Is that not the common response to people saying they are not getting paid enough?

Read the articles; the senior people that have left the company have done so because they don't agree with the corporate notion that you should reward those that have not earned it; one even proposed a sliding introduction of the pay raise based on incentivization. She was rebuked and subsequently left.

If you still want to contend that it boils down to greed, I'd say that's a very simplistic interpretation of it and that you really should investigate the latter two items I posed to you: equity theory and meritocracy.

 Ensis Ferrae wrote:
Many of the arguments that I'm seeing here, and usually see from right leaning folks, is that Rockefeller was right, and earned his money fair and square, so we should all be so happy that these rich folk are so kind and benevolent as to give us a scrap of "their" money, and because we should be happy, we need to shut up about how fethed the situation is.

Yes, and there is often a weird undertone of punishment, like, "and if you're not happy with poverty wages, minimum wage slaves, we'll just increase automation so you have no job at all! That's what you get for being uppity." A whole vindictive vibe, which of course fits with the being poor is a moral failing concept that often permeates these discussions.

It's weird and strange and gross. As one of the richest countries in the world, maybe we could make an effort to try and minimize the income disparity.

Ouze wrote:

Yes, and there is often a weird undertone of punishment, like, "and if you're not happy with poverty wages, minimum wage slaves, we'll just increase automation so you have no job at all! That's what you get for being uppity." A whole vindictive vibe, which of course fits with the being poor is a moral failing concept that often permeates these discussions.

Is it punishment, or pragmatism? The people striking for higher wages are the ones that can be most easily replaced by machines and automation.

The purpose of these businesses is to make money and be efficient with their money. If the time comes that it costs less to automate than it does to employ humans, don't they owe it to their shareholders to do so?

At this point, I am pretty certain you are not understanding what I am saying.

They complained about how much other people were getting paid and it offended them so much they had to quit their well paying jobs. Just because they were not going to get more money. This is the same concept as telling people in minimum wage jobs that if they do not like the pay, they can find a new job. Same goes for the people involved in this. If they do not like the pay, they can find a new job.

This is greed. Other person gets something. Person thinks they should also get it. Demands to get it. When they are told no, they seek it elsewhere. I mean, it was a stupid decision by the employees that left, because this seems like a pretty nice company to work for. Especially since the CEO actually cares about his employees.....

 Dreadwinter wrote:
I mean, it was a stupid decision by the employees that left, because this seems like a pretty nice company to work for. Especially since the CEO actually cares about his employees.....

Agreed. As I think I've said many times in this thread, I think that his only real mistake in this whole situation, was in the announcement and timing of it. Announcing it to the world before it's done has lead to some customers losing faith, or comfort in doing business with Gravity (they feared that their paying for services cost would increase). By making the move in a single swift stroke, as opposed to increasing pay over the span of 3-5 years or whatever, he's obviously lost some employees over butt-hurt (whether they were good employees or not is highly debatable, if they are leaving over this thing)

 cincydooley wrote:

 SilverMK2 wrote:

 cincydooley wrote:
In that same regard, I don't think there should be any kind of cap on CEO salaries, etc. If their boards can justify them, then so be it.

A cap works quite well in nations which have set them.

Great. I can't say I care about those countries.

I think it's an anti-capitalist ideal. There should be no limit on one's earning potential.

Sooo... you don't care about looking at evidence of how things have and are actually working in variations of the system under discussion because "this is 'MERICUH! damnit!"?

Excellent reasoning skills. 10/10.


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 cincydooley wrote:
Is it punishment, or pragmatism? The people striking for higher wages are the ones that can be most easily replaced by machines and automation.

To referenceba point raised earlier about skill being required for management of inventory therefore managers being needed and justifying their wages; modern logistics software easily replaces the need for 90% of their role, so it is not just the "unskiĺled rabble" that need to worry in the drive for ever increasing profitability through exploitation wages.

Hell, even well paid positions like stockbrokers are have been largely computerised. It is only tbe massive expansion of the market which keeps the numbers of such people steady...

 SilverMK2 wrote:

Hell, even well paid positions like stockbrokers are have been largely computerised. It is only tbe massive expansion of the market which keeps the numbers of such people steady...

It isn't just that. There is still a general fear of leaving the fate of something important to you up to an automated process. Additionally, at least in certain industries, the variability provided by human judgment is often seen as a positive.

For example, I'm a political analyst. I could easily replace the coders working under me with a simple text recognition program, using various forms of correction to simulate bias; this would save my employer a great deal of money. However, if I were to do that, I would ultimately be more reliant on my own biases (as they would be written into the software), making my final results less reflective of the conditions under examination. Indeed, there is a good chance my employer would lose business as a result, due in part to my first point.

Sorry, my point was more that each broker can now look after more transactions as they have automated tools at their disposal to trend data and carry out trades. If technology had not kept pace with the size of the market, it would require many more brokers to do the same amount of... for lack of a better word... work.

As with yourself and your data team; some elements of technology enable you to work efficiently in ways that were not previously possible. To do the same job as you currently do, it would have taken many more people. And as you say, it is not beyond possibility to replace even more of the functions currently carried out by skilled people with technology, although perhaps not desirable from some angles where subjective judgement comes into play. Although removing 90% of the humans, adding 5% human to tend the machines and tinker the data soirces and outputs and then 5% to supply subjective judgements and feed back to the technical team and do you objectively lose out significantly on the end result? (I have no idea, not being a political analyst but my gut says such an extension of the current trend towards automation would not be as disasterous as a wholesale replacement would have been even 5-10 years ago; computer programming advances fast ).

 cincydooley wrote:

Ouze wrote:

Yes, and there is often a weird undertone of punishment, like, "and if you're not happy with poverty wages, minimum wage slaves, we'll just increase automation so you have no job at all! That's what you get for being uppity." A whole vindictive vibe, which of course fits with the being poor is a moral failing concept that often permeates these discussions.

Is it punishment, or pragmatism? The people striking for higher wages are the ones that can be most easily replaced by machines and automation.

The purpose of these businesses is to make money and be efficient with their money. If the time comes that it costs less to automate than it does to employ humans, don't they owe it to their shareholders to do so?

They do, by writ of law, but that doesn't make it correct.

Personally, were I given the power, I would change that. The most-important function of a business in America, regardless of its size, is to contribute to the stability of American society and its economy. To do otherwise is treason.

 SilverMK2 wrote:
Although removing 90% of the humans, adding 5% human to tend the machines and tinker the data soirces and outputs and then 5% to supply subjective judgements and feed back to the technical team and do you objectively lose out significantly on the end result?

Comparative studies have shown that the number of humans involved in the coding process positively correlates with predictive accuracy with respect to both polling and election results. It is widely suspected that this is because automated coding tends to increase the weight of the opinion of a single coder, the person who lays out the coding parameters followed by the program, as he necessarily has greater control over the process than he would in the presence of a greater human element.

To what kind of margin are we talking for accuracy? (Not trying to be a pain; actually interested ).

 SilverMK2 wrote:
To what kind of margin are we talking for accuracy? (Not trying to be a pain; actually interested ).

In an election on the scale of the US Presidential the mean increase in the probability of an accurate result over a fully automated system is ~5% per human unit (HU)*, with an overall increase in the probability of an accurate prediction topping out around 60% before diminishing returns start to set in. And they set in hard, past a certain point you quickly start seeing marginal increases of .1% per HU or lower.


*Usually considered to be 10 coders holding at least an MA in a relevant field; usually political science, history, or sociology.

So, with 60% accuracy being about as accurate as you can get, what is your average for a "purely" automated prediction?

If I read your post correctly, I take it that your fully integrated team and working with some kind of data gathering and interpreting system with a 60% accuracy would only be getting ~55% accuracy if you removed one HU (aka 10 coder/interpreters) while still using the same software?

 SilverMK2 wrote:
So, with 60% accuracy being about as accurate as you can get, what is your average for a "purely" automated prediction?

Let me clarify. That's a 60% increase in the probability of an accurate prediction relative to a purely automated system prior to the onset of diminishing returns. So if say an automated system is correct 50% of the time, a system featuring a human element and operating at peak efficiency would be correct 80% of the time.

 SilverMK2 wrote:

If I read your post correctly, I take it that your fully integrated team and working with some kind of data gathering and interpreting system with a 60% accuracy would only be getting ~55% accuracy if you removed one HU (aka 10 coder/interpreters) while still using the same software?

Not necessarily. Removing 1 HU could cause a significantly greater drop in accuracy as the distribution for the marginal probability increase caused by the addition of single HU is neither normal, nor symmetric about the mean.

I assume there is also an upper limit as well. Too many cooks sort of thing?

 Grey Templar wrote:
I assume there is also an upper limit as well. Too many cooks sort of thing?

There is, but it has more to do with available time and the limitations of data collection than anything resembling "too many cooks".

 dogma wrote:

 SilverMK2 wrote:
So, with 60% accuracy being about as accurate as you can get, what is your average for a "purely" automated prediction?

Let me clarify. That's a 60% increase in the probability of an accurate prediction relative to a purely automated system prior to the onset of diminishing returns. So if say an automated system is correct 50% of the time, a system featuring a human element and operating at peak efficiency would be correct 80% of the time.

 SilverMK2 wrote:

If I read your post correctly, I take it that your fully integrated team and working with some kind of data gathering and interpreting system with a 60% accuracy would only be getting ~55% accuracy if you removed one HU (aka 10 coder/interpreters) while still using the same software?

Not necessarily. Removing 1 HU could cause a significantly greater drop in accuracy as the distribution for the marginal probability increase caused by the addition of single HU is neither normal, nor symmetric about the mean.

Gotcha.

 cincydooley wrote:
I agree that you can't really quantify it. However, I simply can't swallow that entry level work = CEO work, on the level of responsibility and corporate stewardship alone.

Of course not. But the flip side of that is to argue that you can no longer find a CEO for

In that same regard, I don't think there should be any kind of cap on CEO salaries, etc. If their boards can justify them, then so be it.

I'm not much in favour of a cap, or really for any direct government involvement. But when you talk about boards justifying CEO remuneration, you need to understand how broken that system is. CEO's often appoint their own remuneration panel. These panels will generally dress up pay considerations with apparently objective considerations, but these are generally transparently silly - an IT company might use a bunch of other IT companies for it's comparison, and use Google and Oracle as peers.

Meanwhile, we know from research there's no relation between company performance, present or future, and CEO remuneration. You can find a good CEO for $5m just as easily as $50m. There is, however, a strong relationship between high CEO pay and corporate failure. Of the last 20 years 40% of the individuals in the highest CEO pay lists ended up being fired, seeing their companies collapse, or testifying to illegal behaviour. It's almost as if the guy who'd demand every possible cent in pay isn not the ethical leader who'll serve their organisation best.


You should know by know I like well functioning markets. But this is a massive market failure, and we need better shareholder organisations to make sure that value rightfully goes to the people who deserve it - the shareholders.


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 Grey Templar wrote:
Maybe, but what if that company is owned by the CEO in question? Surely he has a right to run his personal property how he sees fit and can pay himself whatever he wants.

If he's the only owner of the company then his pay as CEO is a gibberish question. Whatever profits the company generates can be distributed to him as dividends or as CEO pay, it doesn't matter.


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A company has no obligation to ensure its employees aren't living below the poverty line. It is only obligated to pay them an agreed upon rate for their labor. If that rate is below what a particular employee needs to make ends meet that isn't the company's concern, morally or legally IMO.

One of the weird things about the fleshy meat sacks we call 'humans' is that they tend to assume some kind of moral obligation towards other people they deal with.

Especially since there is no objective way to pinpoint what exactly a 'living wage' is.

An exact definition is impossible, but a general idea isn't rocket science.


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 cincydooley wrote:
So....lets do the math:

Michael Duke made $35MM the last time it was reported. His successor, Doug McMillon, makes $25MM.

There are 2.2MM WalMart employees.

What a fascinating example you picked, with Walmart. Were you aware that Walmart had recently undertaken a plan to increase employee remuneration? And this program was intended not just as charity, but to increase profits as higher pay reduced turnover and improved employee productivity.


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 Grey Templar wrote:
So if there is no good reason for cutting CEO salaries, why do people keep insisting that this get done? And proposing absurd ideas of legally capping income.

Because it's absurd to pay someone $140m to do a job they would do for $10m, or that other equally skilled people would do for even less.