With the recent debates about America’s minimum wage, it seems we have a nation divided. Should we raise the minimum wage to $15/hr? Or is $7 and some change good enough? Many who “Fight for Fifteen” like to say that CEOs are already making enough money, and the wealth needs to be distributed amongst the hard working employees. Which brings me to this.
Q: Are CEOs paid too much?
A: Are CEOs paid a lot? Absolutely. Do they deserve it? Most definitely.
They may not be out on the concrete factory floor doing the same labor intensive work day in and day out. They may not be slaving over a hot stove, or frantically serving too many tables. They may not be operating heavy equipment, or getting dirty in the mines, or cutting down timber, a dangerous job. But these CEOs are doing something that their employees are not: taking a financial risk.
The CEO took a chance by investing in the start up, or ownership of a company. If it failed, he or she would be responsible, and would lose everything invested. The CEO is responsible for all of his or her employees, ensuring the company is running efficiently, all finances are accounted for and correct, keeping good public relations, advertising, the list goes on and on. The CEO is at risk every day, and must stay on top of all this. The employees are at, almost no risk. The worst that could happen, is a loss of employment. In that circumstance, the employee could simply take his or her skills to another company looking to hire. The employee chooses to work daily, in exchange for a set rate of pay (or salary), with no risk of losing the money he or she has already earned. The employer (aka, the CEO) is not forcing the employees to work. The employee and the employer both agreed on a set rate of pay when the employee took the time to submit an application, do an interview, and accept the job. If the employee doesn’t like it, he or she can refuse the job, or quit.
This isn’t slave labor, this is two grown ups who need something from one another (one needing money, the other needing labor), and have come to an agreement. Since the CEO owns the corporation, he or she ultimately has control over determining the pay, but knows that the rates must be fair, otherwise no one will apply for the openings available.
Imagine working at McDonalds for 8 hours, in exchange for $1. No one would apply. I do believe the government should set a relatively low minimum wage, and have laws against child labor. But, for the most part, the CEO and the applying employees will figure out an appropriate pay. It’s called supply and demand, courtesy of capitalism. In my humble opinion, yes, I think the CEO deserves every penny he or she makes. It was earned by taking a chance, doing the work, and succeeding. And if the CEO had the company dropped in her or her own lap by a parent? Good. The parent had every right to determine who takes over the company. It’s theirs to give away, and now, the new CEO runs the risks of losing the company, if it is not managed well.
And while you may be angry at the CEO for hoarding so much money, perhaps you should ask for a raise, or ask what you can do in order to earn a raise. Or get a better paying job elsewhere. But remember, if you don’t want to be your own boss and chase your own ambitions, you’re going to have to be someone else’s employee, chasing their ambitions for pay. That’s capitalism in America, and I hope it’s here to stay.
What are your ideas on the minimum wage? Do CEOs make too much? Should the government interfere by setting minimum wages? Thanks for reading! And thank you for feedback!