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The Average CEO Made $9.7 Million In 2012

The Average CEO Made $9.7 Million In 2012

The rich get richer, and the poor get poorer.

Apparently this has never been truer than in 2012.

In 2011, the average CEO salary was $9.6 million, an all-time high, but now it turns out that CEO salaries in 2012 averaged† a whopping $9.7 million, for the head of† a typical large public company. Overall, health care and media CEOs picked up the highest pay, while utility CEOs enjoyed a meager $7.5 million.

Why do CEOs earn so much? Companies say they need to attract the best talent, and huge salaries are the way to do it. Whatever their justification, the shocking fact is that the average CEO in 2012 earned 354 times more than the average worker.

This was not always true. Income inequality has greatly increased over the past 30 years: in 1980 the average CEO made 50 times more money than the average worker while today the average CEO makes over 300 times more than the average worker.

Thanks to deregulation in the 1980s the top one percent of Americans have seen skyrocketing salaries, while worker pay has stagnated.

What does this mean for us regular folk?

From Pew Social & Demographic Trends:

During the first two years of the nationís economic recovery, the mean net worth of households in the upper 7% of the wealth distribution rose by an estimated 28%, while the mean net worth of households in the lower 93% dropped by 4%, according to a Pew Research Center analysis of newly released Census Bureau data.

From 2009 to 2011, the mean wealth of the 8 million households in the more affluent group rose to an estimated $3,173,895 from an estimated $2,476,244, while the mean wealth of the 111 million households in the less affluent group fell to an estimated $133,817 from an estimated $139,896.

Looked at another way, the top 1 percent of Americans control 43 percent of the nation’s financial wealth, while the bottom 80 percent control only 7 percent of the wealth. Incredibly, the wealthiest 400 Americans have the same combined wealth as the over 150 million people who make up the poorest half of Americans.

The United States is not alone in developing this growing divide between rich and poor. The Organization for Economic Cooperation and Development (OECD) recently released a report showing that economic disparity has risen more from 2007 to 2010 than in the preceding 12 years in developed countries. The greatest discrepancies among OECD countries were found in Chile, Mexico, Turkey, the United States and Israel, while the lowest were in Iceland, Slovenia, Norway and Denmark.

What’s more disturbing is that the United States currently has more income inequality than Pakistan or the Ivory Coast, according to a study by ThinkProgress using data from the CIA factbook. Income inequality in the United States is actually higher than at any other time in modern history since the Great Depression.

While the average CEO makes that $9.7 million, nearly 50 million Americans, more than 16 percent of the population, are barely surviving. Figures released by the Census Bureau in 2012 found an increase in poverty numbers, going from 49 million in 2010 to 49.7 million in 2011.

One of the most depressing and shameful findings is that almost 20 percent of American children continue to live in poverty.

Yes, it’s exactly what you thought: the rich are getting richer, and the poor are getting poorer.

 

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Photo Credit: thinkstock

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148 comments

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3:47PM PDT on Jun 4, 2013

They get paid an average of 9.7 million off the backs of those whose jobs were lost and are now unable to support their families. Jerks.

7:40AM PDT on Jun 4, 2013

They may get paid $9.6 million but they certainly don't EARN it.

The idea that anyone deserves that while children starve to death is what is hobbling humankind.

10:09AM PDT on Jun 3, 2013

MILLIONS of families are struggling to survive now find life even more difficult and cannot afford even the basic things. More have to rely on the Govt because corporations don't want to pay enough in wages. Then these corporations let people believe they are paying 35% in taxation when in fact they are not.....with deductions and loopholes. Some hide money overseas....because they are sitting on trillions of dollars in cash.
The only way to get corporations to spend this money is to TAX them.....then they'll spend the money to expand and reinvest and hire more people.

8:14AM PDT on Jun 3, 2013

In Spain, in the early 50s a company was started, Mondragon, that now is doing very well, even during the recession where no one is allowed to make more than 5 times the lowest paid worker. This having to pay for the talent is a load of crap. There are many people who can do their jobs for a tenth of a the salary. But they need to maintain the status quo. Horrific, economic barbarism.

7:58AM PDT on Jun 3, 2013

thanks for the article

8:13PM PDT on Jun 2, 2013

There is nothing new under the sun

8:13PM PDT on Jun 2, 2013

There is nothing new under the sun

4:11PM PDT on Jun 2, 2013

Bah... This is nothing new and certainly not a standard of the 20th century. Just open a few history books...
Look at the Pharaohs, the Mayans, the English, the French, the Spanish, to name a few.
The rich were very rich and the poor very poor with a few wealthy merchants in between.
In every society, the Aristocracy (that would be our C.E.O.s) didn't pay any taxes.
Everyone else (that would be us, schmucks) paid taxes that, guess what?... financed the wars the aristocracy loved so much, and generally sustained their outrageous lifestyle.
So what's new? Numbers, percentages, facts. Big deal.
In reality, nothing has changed.
Hello!...

10:58AM PDT on Jun 2, 2013

So, according to these figures, nobody but the upper 7% and the top of the middle class can afford to 'have children'. I say this because it always astounds me that so many people still repeat that ignorant, arrogant crap because they don't want to 'pay for others peoples children'.Who do they think will produce the bodies for boots on the ground military and hands in the clay working class? How are they going to force those upper income ladies to start birthing 10 or 12 babies , just to send them off to do the real work of the country? If you want to keep your kids at home and send them to collage, then better plan on putting more taxes into the collective account. And it wouldn't hurt to show some decent respect for the people who make
life, as we know it possible and shake loose from that out dated stereotype of the poor as parisites.

3:51AM PDT on May 31, 2013

Watch this video to gain some insight into how the wealthy have rigged the game.

You also might then understand how the wealthy can afford to spend millions of dollars (their pocket change) to load internet discussion groups with outspoken zealots (liars).

http://video.pbs.org/video/2296684923/

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