Yabby,

What about all of those internationally successful European and Japanese companies? How can they exist? These countries have much less inequality than the Anglosphere countries, and CEOs are not as well paid. Why aren't the really talented ones simply lured away by more money elsewhere? You give anecdotal evidence of companies that were turned around by highly paid CEOs, but why isn't it possible to establish a general link between CEO pay and company performance, at least for large firms?

http://www.gsb.stanford.edu/news/research/compensation_daines_ceopay.shtml

In the US during the 1950s, there was rapid economic growth, which was shared more or less proportionately between the social classes. Now, the share of income going to the people at the top has increased dramatically, while the bottom 90% of the population have had stagnant real incomes since the 1970s. Even many people in the top 10% have only gotten a few crumbs. See

http://www.epi.org/analysis_and_opinion/entry/jobs_with_good_benefits_increasingly_scarce/

How, exactly, have ordinary Americans benefitted from those enormous CEO salaries and bonuses?

Stezza likes to talk about the politics of envy, but personally, I couldn't care less if Stezza has more consumer trinkets than I do. I have everything that I need or could reasonably want. However, I care a great deal if Stezza is rich enough to buy my government and to cocoon himself from the downside of the policies he is advocating. In "Collapse", Jared Diamond remarked one of the things that distinguish whether a society will collapse or solve its problems and survive is whether the elite can insulate themselves from the problems that their policies are causing for ordinary people. When a society does collapse, of course, the children of the elite suffer as much as anyone else, and maybe more, because the other people blame them.

In my view, Valerie has it about right, as there does have to be some incentive for performance.

Divergence, you are quite correct, in Japan, Korea etc, CEO salaries
are much lower then in the anglo West. The way I understand it,
its a totally different culture. Workers are generally company men,
they join after college and stay for life, alot of the time.
Japanese culture is very much about not rocking the boat and conforming
with the majority. Its one of their strengths, but also one of
their weaknesses, as it restricts innovation and change.

I am unaware of too many top Japanese having been headhunted by
Western companies, for I think that the cultural divide is simply
too great.

I actually agree, I think that some US CEO salaries are way over the
top. But given that they are private companies, I think its up to
shareholders to express their outrage, if the board gets it wrong.
Shareholders are ultimately risking their capital and paying that
wage, so in that sense, its a private matter, not a public matter.

Govt has its chance to rake in its share, through taxation, in order
to level the playing field to some degree.

I think that our press has a bit to answer for too, when it comes to
CEO salaries. The press love sensational headlines, so that is what
they produce. Yet AFR recently published a guide to CEO salaries
and the majority of those from really large companies were on
1-3 million $. Then they were given performance bonuses, if the
company should meet certain parameters, in the next 5 years or
whatever. So many of those CEOs will only be paid the claimed amount,
if all goes according to plan for years ahead. The press commonly
try to present it, as if its in the weekly paypacket.

Given the base salary of 1-3 million, take away half for tax and
the figures are not that far off what Valerie is on about.

My point is this: A board of a private company, with private investors
money at stake, should not be restricted as to whom they can hire,
based on social policy that some would like-to-introduce

Clearly finance is not your strong point :)

LOL - you would not be stating this if you knew me Yabby; more importantly, however, I would prefer to be labelled as weaker in finance, than weaker in spirit - a 'giver' throughout life (in a constructive way)receives a great deal more than a person who focusses on their financial situation constantly.

Farmers and Graziers do not require 'shares' to be assisted by Wesfarmers though Yabby. Just a little correction from experience.

If you didn't know, there was a depression in Australia in the 1930's, a depression or recession in the US also, and probably in the UK and the rest of the world. We were pulled out of it by Harold Holt, he experimented with the tax and found that a top tax of 66.6% was needed to restrain obscene incomes. This tax kept Australia with a good economy for 20 years, 1950 to 1970. What Harold did not realise was that a higher no tax amount, and if this 66.6% was applied to a $450,000 taxable income, and about $30,000 was the no tax amount, our economy would tops. No treasurer, Labor or Liberal, has the necessary intelligence or integrity to correct that anomality. Wayne Swan has had it put to him, but their salary and perks are too high, and even if they get kicked out , they still get far more than they are worth. Only Honest, intelligent people are worth $1million, and they would be satisfied with the same as any workman. The greed of the politicians shows their true value. Have a look on the internet at "Tax history of the US", "Tax history of Australia", "Tax history of the UK",and "Taxes around the world", and remember that the US is in a depression now, and so is most of the world, Australia has been if recession 3 times, and skimming along just clear of it, and both the Labor and the LIberal/National parties are to blame.

Merv09,

Right on! But let me digress a moment.

NSW Government has declared a "Prorogued" Parliament. In Latin that means to supend in order to ask more questions (ie do research). A genuine and common enough strategy. However in Keneally's case the Romans would gleefully declare a "Profraused" Parliament. That is, suspended in order to deceive the many from the intentions of the few who consider themselves too big to fail even as they head for failure at the March 2011 election.

Hopefully, the dire cost consequencs to NSW citizens of privatised electricity will lead to a full-on revolt that will clean out Macquarie Street. I don't know a single person in NSW who will be able to afford electricity in 3 years time. And electricity next to petrol is the only thing that keeps our society from THERMAL EQUILIBRIUM or total decay and collapse. Human societies must understand that all things in this Universe obey the Second Law of Thermodynamics and that necessarily applies to NSW and its many varied communities.

Your Holtism of taxing the rich at 66% is the only answer to stop the arrogance of the few in pursuit of collapsing the many.

Additionally I propose that new immigrants must pay ~$300,000 infrastructure dollars to settle in NSW areas where electricity is already at a premium. This will shift the burden of infrastructure costs onto those who make new infrastructure necessary. That is basic JUSTICE and DECENCY. Not the "bleeding-heart" welcome freeloading Adolf Hitler immigrants in case they might be a new Olympic medal contender, Labor Party doyen or a criminally inclined Barangaroo proponent.