CEO Pay Soars at Companies That Send Jobs Overseas

Big businesses often justify outsourcing by arguing that the
money it saves is used to help stay competitive in a fierce global
market. But more often than not, this money just ends up at the top
of the corporate ladder, making sure a few people experience
outsourcing’s benefits while many more experience its down side. A
new report, ‘Executive Excess 2004: Campaign Contributions,
Outsourcing, Unexpensed Stock Options and Rising CEO Pay,’ shows
that those CEOs whose companies are top outsourcers enjoy an
average of 46 percent pay increases, well above the 9 percent
average for all CEOs at 365 large companies. This spike in CEO pay
further widens the recently-narrowed CEO-to-worker wage gap, which
is currently 301:1. Though public pressure is beginning to check
the most outrageous CEO pay plans, there are few signs of either
outsourcing or inflated CEO compensation slowing down. Together,
outsourcing and CEO pay hikes make for massive inequalities: while
the CEO-to-worker wage gap is 400:1 for American call center
workers, those same Americans look downright pampered compared to
the 3,348:1 gap experienced by Indian call center workers employed
by American companies.

What are CEOs doing with all this money? The study shows that
the top CEO earners are also big political donors, with the 69 CEOs
whose companies sponsored the Democratic and Republican conventions
earning a 52 percent pay hike in 2003. It seems that outsourcers
have significant leverage when it comes to influencing public
policy, so the current effort in Congress to squash restrictions on
stock option grants, the use of which have saved CEOs $3.9 billion
in tax deductions, is hardly surprising. A new recipe for corporate
power is emerging in America and outsourcing is the key ingredient.
As jobs become scarce and wealth becomes more concentrated, it
seems ironic that our country belongs to those who would rather
find employees somewhere else. Talk about a conflict of
interest.
— Brendan Themes

Go there >>
CEO
Pay Soars at Companies That Send Jobs Overseas

Related Links: