Slashdot Mirror
Are CEOs Overpaid? Not Compared With College Presidents (cbsnews.com)
schwit1 writes: For outrageous executive earnings, don't look to Wall Street -- look to academia. High pay for CEOs attracts annual attention and recitations about the immorality of capitalism, but when the focus is on average CEO pay, they make less than half the annual earnings of college presidents, according to CBS News. The average CEO earns $176,840 annually, an amount that would make a university president into a pauper. In academia, college presidents earn $377,261 annually. Americans outraged and indebted by high college costs will be quick to draw the parallel between a college president's pay and their tuition bill. Correlation, though, doesn't imply causation. College presidents aren't always the highest-paid college employees -- athletic coaches often earn more. Regardless, college presidents "are well into the 99th percentile of compensation for wage earners in the United States," Peter L. Hinrichs and Anne Chen noted for the Federal Reserve Bank of Cleveland.
classify the businesses into upper, middle and lower groups and redo the comparson.
The average CEO earns $176,840 annually, an amount that would make a university president into a pauper
Are they including self-proprietorships or something?
"First they came for the slanderers and i said nothing."
Are they just talking salary? As far as I know university presidents don't have stock options.
" If college presidents were to divide up their pay and write out checks to all their students, the per-person payout would be fairly low, amounting to no more than $300 per student."
The article is about the cost of overall administrative overhead, not just college presidents. The summary itself is even more misleading, as it attempts to compare base salary's between two very disparate fields. A CEO of a normal "wall street" company makes on average 20% of there income as salary. The rest of there income comes from bonuses, benefits and incentives. A large percentage of which is in the form of stock, something a college will not offer.
The corner of a round room
Most of the CEOs compensation isn't "income". It's stocks and bonuses and such. Though I agree the amount presidents of universities are paid is ridiculous, it's no where near on the same level as CEOs. Claiming as such is just classical "there's lies, damn lies and statistics" for misleading.
If you look a true corporations and compare them based on size, most mid to large companies give their CEOs salary, bonus and stock. With stock usually increasing their pay by a multiple (ones I've looked at are 4-7x).
Easy college loans inflates salaries for college presidents.
Easy Fed money inflates salaries for corporate presidents.
Reforms are long overdue for college loans and monetary policy. Reduce easy money, watch salaries deflate.
Brought to you courtesy of Big Govt handing out Big Money and encouraging Big Student Loans.
This is what happens when an industry is subsidized.
For a college w/ 10,000 students, that's about $37 of their annual tuition. So for an average tuition of $29,056 that's about 0.1%.
Can offering a competitive salary for the college president improve a student's experience by 0.1%? I'm guessing yes.
... also, I can kill you with my brain.
and we can't have that. At least, as far as one side knows...
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
...And let's not get started on college football coaches.
Slashdot does purport to be a tech news site, last time I checked, and this is neither "news for nerds" nor "stuff that matters" (unless you are one of the vanishingly few that happens to work in higher education).
Hate to break the bad news for you. Not all Slashdot readers live in their mother's basement. Most of us worked in the Big Blue Room with the Big Yellow Light upstairs (a.k.a, Real World). Some of us financial wonks don't mind see an article or two on the economy.
Are they just talking salary? As far as I know university presidents don't have stock options.
You called it. Stock, bonuses, and golden-handshakes are where the money is. The salary is just covering "base load", to keep the wolf away from the Yacht's dock gate while the company isn't doing well enough that the big bucks aren't flowing adequately.
That's why turnaround CEOs can do the "dollar a year salary" thing for P.R. without hurting themselves financially.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
The question is phrased in a manner that is designed to draw out a pre-defined conclusion.
The question should be:
1. Are CEOs overpaid?
2. Are College presidents overpaid?
The real "Libtards" are the Libertarians!
... this is neither "news for nerds" nor "stuff that matters" (unless you are one of the vanishingly few that happens to work in higher education).
Huh?
Are you saying nerds don't go to college and pay tuition? That they don't pay taxes that fund public colleges? That they don't work in corporations? That they don't hold stock in corporations? That they don't buy products of corporations? That they don't design things that require buying parts from corporations? That they don't vote? That they don't have children that will go to college or interact with corporations? (I could go on.)
My nerd credentials are impeccable and I consider this to be news for me and stuff that matters. And I get SO tired of having my reading interrupted by postings claiming otherwise.
Maybe we need a new down moderation, or other filterable label, for "Gripes about relevance to nerds."
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
Are they just talking salary? As far as I know university presidents don't have stock options.
It is also a profoundly stupid critique in the first place. University Presidents are not only responsible for the whole university, but they are responsible for bringing in massive amounts of money. Your job is not only to provide leadership and support leaders underneath you, but to bring in the millions of dollars in donations that your school can use to expand its programs, increase financial aid, and keep tuition increases low.
If you were on a University Board of Trustees, wouldn't you want to spend the money to hire the right person for that job?
No, we're just underpaid
Yes, if you compare to what they are worth
Maybe, you just gotta pay them enough to keep their mouths shut
“He’s not deformed, he’s just drunk!”
Are they total idiots, or being paid?
Of course the average CEO doesn't earn a killing. I'm a CEO. I make less than I did when I had a regular job.
The problem has never been the average CEO. The problem is the high-end CEOs. The guys who run banks, fortune 500 companies and such, who earn several thousand times what normal employees or, in fact, average CEOs make.
Assorted stuff I do sometimes: Lemuria.org
They have managed to make themselves indispensable to modern life. Very clever, very tricky, very evil.
Fine, then go to a DIFFERENT website.
This is scope creep and anyone here that's been up to see "the real world" should despise scope creep for the evil that it is.
A Pirate and a Puritan look the same on a balance sheet.
No one says it, but if Bernie Sanders' free college plans are going anywhere, it means college and university employees will have to take drastic cuts in pay. Free college is completely unaffordable for any government budget otherwise.
I'd like to also add that from the end of WWII to the beginning of the 70's, a college grad could walk into pretty a job upon graduation.
What happened at the beginning of the 1970's? President Richard Nixon took the US off the gold standard and inflation took off to devalue the dollar.
The new version is get a degree in a STEM field and you got it made is the new .... money major.
When I went back to college to learn computer programming and earn my technical certifications after the dot com bust, everyone told me I was crazy. Healthcare became the new money major. So everyone and their grandparents enrolled in healthcare classes. When I got started, I couldn't get a programming class because there were too many students. When I got done, I couldn't get a programming class because they weren't enough students. Even the Cisco courses got cancelled, which often had a waiting list to the waiting list.
Several of my friends went into the healthcare field. They make great money but are miserable in their jobs because they don't enjoy helping people. Which is ironic considering that some of my best paying IT support contracts are from hospitals. Although I don't make a lot of money, I do love the technical work. That makes all the difference in the world.
Holy moly, this story is a lot of horseshit. There are one thousand, eight hundred and forty five private universities in the US. In 2010, there were 27.9 million businesses in the United States, and 18,500 or so have more than 500 employees. That means that at least 27.8 million of those businesses are what you'd call small businesses, which can mean one employee who happens to be the CEO for his little corporation that sells t-shirts on Etsy. I guarantee that the average salary of one of those corporations with more than 500 employees is a great deal more than the average university president where there are more than 500 employees.
So what we have here are two things being compared. One of which is defined and the other which is not. Does anyone know what you get when you take the average of something that is not defined?
I swear to Jesus, it's no wonder people are so dizzy that they're willing to vote for the spawn of Biff Tanner and Benito Mussolini for president. This is what they get for news.
You are welcome on my lawn.
Free college is completely unaffordable for any government budget otherwise.
Free healthcare burdens many a national budget with unsustainable debt but that doesn't stop politicians from promising even more free stuff.
Fine, then go to a DIFFERENT website.
I have a subscription to The Wall Street Journal. I'm here for the mind-blowing discussions.
This is scope creep and anyone here that's been up to see "the real world" should despise scope creep for the evil that it is.
If you don't like the content, why are you adding comments to the discussion? Be part of the solution, not the problem. Submit what you want to read.
They compared the average salary of nearly 700 private, for profit colleges/universities against the average of all self-identified CEOs.
They excluded any president from a state college/university.
Ken
And once you are a professional and seeing people on wall street that are essentially salesman getting 7 figure bonuses while our 401Ks get decimated by their "management fees".
You have two choices in the matter. You can be a victim and complain about being ass-raped by Wall Street. Or you can be proactive and start your own corporation, make money in a brokerage account, and contribute $53,000 per year into a qualified retirement (nearly three times more than you can contribute with a 401K and IRA).
How about comparing it to CEO's of companies over a 1000 employees? Are they still only making 170k a year?
Now get off my lawn.
Sorry, bud. The goatse posts were more frequent back in the day. I may have seen one or two in 2016. That's an improvement.
Yeah, but we need to get the conversation going so we can hear the campus Bernie supporters say:
"Naw man, not us. We didn't mean us. Send your government enrorcers after some other guys! Please!? Fuck. Now I wish I'd been more of a grown-up and thought things through..."
also back then tech / trade schools where good and they did not take 4+ years to get a job. Now we have lot's of people going to college that are better going some other place and we have tech / trade schools that are to much of a college and not just being about real job skills at just 1-2 years.
CEO / college president
They run the show and see to profits. They seek investors, do public relations and try to create a culture of success.
The problem seems to be that some expect college presidents to be saints, and therefore to work for a pittance. Since some schools are run by government, non-profits or churches should we expect that they are not a business? Well sorry, that's wrong. Schools are a business and their presidents are expected to bring in money just like any CEO.
...omphaloskepsis often...
There's a dirty little secret regarding the European 'free college' program - only qualified, prepared students get to attend college - it is a meritocracy, not a guaranteed entitlement.
In America we have a staggering number of college dropouts with debt accumulated taking remedial classes after high school.
In most European universities only the students that place well on standardized testing earn spots at 'free' universities. Academically-deficient high school graduates will never get the chance to attend university.
What's going to happen when inner-city parents realize all the 'free' university spots are filled with students that attended better schools in the suburbs? Will they demand universities lower their standards, demand their high schools get better, or demand affirmative action spots on campus?
Ken
It varies by school but college football generally pays for itself.
The statistical analysis in this article is absolutely appalling. First you are right that they are not comparing to real CEOs. If you look at the data they use for the CEOs this apparently includes local and state government managers and, even worse, primary/elementary and secondary/high schools by which I presume they mean the head teacher which I don't think anyone thinks off when you say 'CEO'.
...which is sad because I actually think they have a point which their article actually does contain the evidence for if only they knew how to analyse it. If you look at the distribution of compensation then you will note that there is a significant tail out to insanely high values and this is where the problem lies. University presidents should get a high salary - certainly higher than the faculty and staff that they manage unless there are exceptional circumstances e.g. Nobel prize winner - but I fail to see how $1m+ salaries can be justified.
If you just look at the "Management of Companies and Enterprises" category then the average wage amount increases significantly to $210,120 but as you note there is no mention anywhere in the article at all about bonuses and it specifically mentions "wages" so I doubt that this is in any way representative of the actual compensation a CEO gets while the article clearly states that they included all bonuses paid to university presidents. This is clearly an appalling abuse of statistics and so any conclusions the article draws cannot be trusted.
In fact the last time the university where I worked advertized for a president four faculty from Arts wrote a joint, open application for the job (which was shared with the local media) to protest against these ridiculously high presidential salaries. As they pointed out you could hire all four of them, give them each a very significant raise (IIRC 50%) and still save money over the out going president's salary and this way they would be able to do four times as much work. Needless to say they were not offered the job!
Sure, this might be insightful if you're the kind of "financial wonk" that got their expertise from reading MSN Money.
I have a subscription to The Wall Street Journal. I'm here for the mind-blowing discussions.
It's just more click-baiting nonsense about "You should be *OUTRAGED* that these other people make more money than you."
If you don't like the content, why are you adding comments to the discussion? Be part of the solution, not the problem. Submit what you want to read.
This is politics, social justice, and class warfare nonsense that I have little interest in as a "geek" or "nerd". There's plenty of this nonsense in other outlets. I come HERE for the stuff that isn't EVERYWHERE ELSE.
Although some of rebuttals were nice examples of mathematics and logic and that kind of thing kind of borders on "geeky".
Lies, damned lies, and journalism.
A Pirate and a Puritan look the same on a balance sheet.
It's not that "no one will pay for college", it's placing a new tax on stock market speculation that will be used to pay for college. "No one says it" because your entire premise is false, the same reason "no one says" the Earth is the physical center of the solar system.
Instead of trying to start an online fight, you could just actually go read his idea. But then that might take some actual effort and time away from your trolling. It's number 6 on the page, "FULLY PAID FOR BY IMPOSING A TAX ON WALL STREET SPECULATORS."
If $300k puts you in the top 1%, the it's not the top 1% that matter. It's the guys who earn 9 figures that are the problem, they are the guys who run the endowments that pull the strings of these colleges.
I hate printers.
I disagree. This article is about the inequality between college CEOs and their poverty stricken counterparts in broader industry. Poor CEOs who only make $177k per year will soon be rioting. When a person's livelihood and dignity is degraded to the point that they are only earning $177k per year, then it is entirely understandable that they would rebel against the system that oppresses them such.
I hate printers.
All the above are Executive Compensation.
How many shares in Princeton are traded? Oh, wait, zero
Yet another example of selective citation by a rightwinger
Great points. Here's a good discussion about "Why can't America have what Europe has?". It's about health care rather than college, but the realities aren't too vastly different. Also there's some honest discussion, so Trigger Warning for credulous people who believe the stories politicians tell them.
Just let student loans be cleared through bankruptcy. End federal loans. The price of college will drop tremendously when no one is able to acquire the money to pay them.
They're worth what people are paying for them.
Contribute to civilization: ari.aynrand.org/donate
A CEO salary varies a lot. A small business CEO might even earn $0 for a few years. So of course the average is low.
That's the search term I'd be looking for, to compare college presidents to CEOs. With that search term, I keep getting hits for average fortune 500 CEO salary, and the range is from 10.5 million to 13.8 million.
Free healthcare burdens many a national budget with unsustainable debt but that doesn't stop politicians from promising even more free stuff.
A list of nations that have unsustainable national budget debt that can be traced to directly to health care, please? Because, you wouldn't just be making stuff up, right? (One or two examples won't cut it, if you can find any, since you are claiming this is a common pattern.)
U.S. private debt from healthcares costs can be shown to be a real problem though.
Starships were meant to fly, Hands up and touch the sky - Nicky Minaj
Also a lot of Libertarian tripe (McArdle I'm looking at you). Don't be credulous about everything you read on Bloombergview.
Starships were meant to fly, Hands up and touch the sky - Nicky Minaj
...and that is the American Republican Delusion right there.
No, that's how the tax code is written. Play the victim game and stay poor. Play the corporation game and get rich. Your choice.
Choice and game is your word or world - is getting rich the best you can do?
Get up!
Choice and game is your word or world - is getting rich the best you can do?
I've already achieved contentment. Structuring my finances to take advantage of the tax laws is common sense.
I wholly understand what you mean, on the other hand must it be all about you? All the great teachers of history may beg to differ.
Get up!
If $300k puts me in the top 1% then we have bigger problems than we thought.
Why wouldn't you want 300k/yr to be the top 1%? Is there something special about flattened comparative rates?
Often wrong but never in doubt.
I am Jack9.
Everyone knows me.
we weren't talking about the NFL, we were talking about the NCAA. Try to keep up.
remove the class part from NCCA and pay them.
Also when the team needs 40-60 hours a week you don't have time for class or are taking joke classes that fill the gaps.
"Unless you've gone through it yourself, you can't imagine what it's like to live year-round in your summer home."
Immigration: The Human Cost
All of those problems are caused by government interference. Every time socialists use government to 'solve' a problem, they end up making it worse. And then the rich find out a way to control government and use that power to protect their wealth. The solution is less government involvement, not more.
Thank you, Bradley Manning, Edward Snowden and so many others, for courageously defending humanity, my freedom and more!
The fact you only just found it out doesn't mean it's a secret or somehow dirty. What you'd also be aware of if you dug a little deeper is that it is common for European countries to encourage, or even require, universities to consider applicants potential and not just grades. Thus someone who had a poor quality state education who got grades only slightly lower than someone who received a far higher quality private education may be selected on that basis.
European nations aren't, contrary to some American's uninformed preconceptions, entirely naive about these things.
Even if what you've been telling people at dinner parties was true, which is isn't, there are still private universities in Europe. If you could afford a degree in the US then you could afford a degree under the systems of every European country I can think of pretty much regardless of what grades you've received.
Before jumpin' on the bandwagon. $380,000 is 9 to 12 times average salary (which is between $33,000 and $43,000.) I'd expect Joe average to earn more in the heart of capitalism.
I hadn't the slightest objection to his spending his time planning massacres for the bourgeoisie... (P.G. Wodehouse)
Does the College president gets millions in stock options every year?
The solution is for the boards of directors to stop accepting these ridiculous CEO contracts and to stop the greed. College presidents should be paid maybe $300k per year at most and their pay should not cost students a lifetime of loan payback. Sorry but these days college grads are barely making minimum wage (sometimes less) so this illusion of six figures just out of colleges is just an illusion.
"The Brady Bunch is back...working homicide"
The difference between being president of college or another is nowhere near the difference between being the CEO of a huge multinational and the CEO of a two person start up.
Also, I doubt there are any college presidents earning ten or twenty million a year even at somewhere like Harvard.
To have a right to do a thing is not at all the same as to be right in doing it
@schwit1 - Read the fucking article before writing the bullshit summary. The article was about Salaries of Private College Presidents and whether or not it's the driver for higher tuition. A minor point of comparison was that of College Presidents and CEOs. Read the fucking article sometime, jackass.
I know some places like that, they call themselves CEO, hire their kid to do the accounting and call him the CFO...
Whenever you see these unusually-high salaries, the defense always given is that they want to attract the best talent. Obviously, if subpar pay and perks are offered, it's not going to be attractive, but it seems that when you dangle big money, you're mostly going to get people with a taste for money, and damn all else. Has this ever been studied... executive performance vs pay? Do you really get a person 3,000 X better?
Again all problems caused by government interference. Greed is always going to influence people's behavior, trying to create a system that blocks greed is naive. If the college degree is so bad the graduates barely make minimum wage, maybe they should not be going to college at all? The reason college is so expensive is government interference. It means there's no competition and bad idea's are kept alive. "should be paid maybe $300k per year". I think that's a ridiculous number. How do you know it's accurate? You don't, you're just guessing based on the current situation. Why would you let government determine this number instead of the free market?
Thank you, Bradley Manning, Edward Snowden and so many others, for courageously defending humanity, my freedom and more!
I worked at a large, high profile, Div I university, who had a football coach that was paid over a million a year. The football program was a separate entity from the academic programs. So $0 from a students tuition went to fund the stadium expansions or pay the coaching staff their crazy salaries.
There was a significant cash flow that went from the football program to the academic side, but not the opposite.
A CEO arguably needs some talent (although most seem to lack any talent and just follow their MBA training) a university president doesn't require any talent. It's all admin BS and most places largely run themselves. A college president does not come up with new products, or significantly changes the direction of the organization.
Democracy Now! - uncensored, anti-establishment news
If you're in the top 1%, you're clearly a criminal profiteer. This is a problem for people who are in the 1%, but are certain that they aren't criminal profiteers, and yet, they need a catchy name to label criminal profiteers with that makes it seem like they're an exclusive group that is pulling all the strings and must be destroyed.
It's what we call a crisis of labeling. Luckily, there are plenty of other names we can call people who make a lot of money to prove that they are destroying the economy and making the government fail. You could use "wreckers" or "kulaks" or "capitalist pig". I know these are somewhat dated terms, but I'm sure that we can find some chants and slogans which will make use of these terms.
Or how about this? How about we call people on the actions that they have actually taken, as opposed to demonizing a whole class of people just because they make X amount of money? There's always going to be someone in those groups who doesn't deserve the invective that is thrown at them.
On the other hand, I suppose that we could just let God sort them out so that we don't have to do any thinking.
Are you referring to the International Baccalaureate (IB)?
Just checking as my kids have started a French language immersion school (in the US) where the IB is the intended goal after graduation.
BlameBillCosby.com
Thanks for the shout out. But you're thinking of U of Oregon. Oregon State has fielded a few decent football teams this millennium, but Oregon is the spiffily-uniformed team that's dominated the PAC12. Now if you want to talk baseball....Go Beavs!
Never let a lack of data get in the way of a good rant.
University president pay might be higher than CEO pay on average. But that factoid ignores two important things. First, that average CEO pay includes a lot of small companies that don't pay their executives much; it's the huge payouts at large companies that are the issue. There has been no public outcry about the pay of CEOs at companies with ten employees.
More importantly, salary is a small part of the total compensation of a CEO at a large corporation. The bulk comes in the form of stock options that are often worth many millions of dollars. University presidents do not get anything comparable, though they often receive free on-campus housing.
Living in the DC area, our combined incomes put us close to this figure. But $100-200k jobs are very common here. And, the cost of living here is proportional to the salaries. We're both low level managers, and by this the claim is that we're 1%ers, and we're criminally profiteering? If so, you need to get out of momma's basement, and learn something about the real world.
Just another day in Paradise
The article is long on President's salary breakdown's, but short on CEO data. Follow the links and see that the "CEO" data was from a very selective list. From the study: "...This year’s study examined the compensation practices at 3,946 mid to large sized U.S. based charities that de-pend on support from the public...." I am not certain this is even a fair comparison. Apples & oranges?
You failed to detect sarcasm.