GM paying new woman CEO less than half of previous CEO

[Traitorfish]

The problem is, any non entirely subjective theory of value is essentially based on a guess or on a moral/religious theory, not on reality. If we accept the obvious reality that different people value different things differently, in a way not correlated to man-hours at all, we must accept value is subjective. I don't think anyone is seriously debating this at this day and age.

Intersubjectivity is a kind of subjectivity. It's simply not an individual subjectivity. Surely you understand the difference?

Well, I think any definition of value as different from price is automatically a moral theory, don't you? It inherently involves thinking what something should cost, as opposed to what it does cost.

Only if one assumes to begin with that this is the case, which I don't believe Marx does. After all, he was a communist: he doesn't place any moral weight on "value", because for him the only moral society is one which disregards value altogether. His category of "value" is analytical, intended to expose the social logic behind capitalism, rather than an attempt to explain pricing systems. He is interested in why prices exist, on what they signify at the level of social reproduction, not in how they came to rest at a specific number of pounds, shillings and pence.

 

[Borachio]

Is there general agreement on what intersubjectivity means?

I don't get this. Surely language is the ultimate mechanism for intersubjectivity. Hence, if you can talk about it, it must be intersubjective.

If you can't talk about it, according to, I don't know, someone like Wittgenstein, can it be said to exist at all?

(*mutter mutter* *grumble grumble*)

 

[Traitorfish]

Is there general agreement on what intersubjectivity means?

I don't get this. Surely language is the ultimate mechanism for intersubjectivity. Hence, if you can talk about it, it must be intersubjective.

If you can't talk about it, according to, I don't know, someone like Wittgenstein, can it be said to exist at all?

(*mutter mutter* *grumble grumble*)

Language is usually considered a big part of it, yeah, although my formal education and personal interest is all degenerate Continentals, so I can't comment on Wittgenstein, etc.

 

[Formaldehyde]

I don't think we have enough information to decide if this is a gender discrimination case. Like others have said, Luiz's description of the pay structure sounds about right, and besides, we should probably applaud lower CEO pay anyway (at least for a firm that was recently heavily on govt assistance).

But the last CEO made far more, and the loan from the US government was paid off years ago. Even GM recognizes that she is currently being underpaid. They claim that it will be properly addressed in the near future.

 

[woody60707]

But the last CEO made far more, and the loan from the US government was paid off years ago. Even GM recognizes that she is currently being underpaid. They claim that it will be properly addressed in the near future.

No, she is still being absurdly over paid. Just because someone else is being paid even more money doesn't change that fact.

 

[Kyriakos]

No, she is still being absurdly over paid. Just because someone else is being paid even more money doesn't change that fact.

Indeed.

Not sure how people (even moreso by now) can ask for those ceo's to be paid even more millions per year, even on account of some 'gender equality'... Fantasy land :/

I am pretty sure no woman, or man, actually need a raise when already they get 1 million dollars + each year.

 

[Formaldehyde]

No, she is still being absurdly over paid. Just because someone else is being paid even more money doesn't change that fact.

Then why aren't you and others whining about the CEOs who make far more, instead of picking on someone who actually made more money at her previous job at a far smaller company? It just comes off as being a double standard.

But I'll bite. What do you consider to be appropriate compensation for someone who runs a $150 billion dollar a year company like GM, which made a $4.9 billion PROFIT in 2012 in what is one of the greatest bankruptcy comebacks in corporate history?

Kobe Bryant makes $61M per year. How is his compensation worth 14 times what hers is when she is directly responsible for the jobs of 212,000 people?

 

[Kyriakos]

^Do you believe any human needs more than 1 mil dollars/year?

You are mixing two issues. No sane person asks for ceos to be paid those amounts. Should not be different if the ceo is a woman or man, as in: neither should cause an outcry from anyone if their salary is cut to just a miserable 1 million dollars/year

 

[Crezth]

No, she is still being absurdly over paid. Just because someone else is being paid even more money doesn't change that fact.

Hey, go to communist Japan if you don't like it, buddy.

 

[Dralix]

^Do you believe any human needs more than 1 mil dollars/year?

Not your decision to make.

 

[Hygro]

Well that decision is being made, and maybe that process sucks and doesn't do any justice the real possibilities of a well organized economy embedded in a well nurtured society.

 

[luiz]

Snip

OK, interesting discussion. I think we can all agree that the market will often move away from optimum pricing due to "irrational" behavior on the part of many important participants; the branding vs returns paradox you mentioned is indeed a good example. Economists have been warning people against investing in funds with high administration rates for a long time, seeing as they on the long run don't outperform the indexes, but many people still believe in the power of investor magicians, who thus make a fortune on fees even tough they're not delivering any real value. And of course there will always be some fund managers who will consistently beat the market for a long time and thus fuel the myth that this is a rule.

None of that is controversial, at least for me. BUT as I mentioned in another post, to prove that market wages (or prices in general) are optimum (as opposed to "perfect") one does not need to prove they are flawless, merely that they are better than viable alternatives.

Getting back to CEO pay, it's long established that their pay structures are flawed; that they do not provide adequate incentives; that the principal-agent problem remains very much alive. All of that is known, many papers were written about it, and all shareholders in the world know that. And they always try to address those issues. Several features of CEO compensation that are hated by many, such as golden parachutes, were invented precisely to address the principal-agent problem and other issues. So we all agree there are problems. But is the alternative superior? Is a magic number such as 50 ("the CEO should only make 50 times the median salary of his employees) any better? I think it's easy to demonstrate not. Or even worse, a magic wage limit ("nobody should make more than 1M per year"). It's simple to demonstrate those would lead to worse results than the market, hence our current wage-setting mechanism is superior, even if not perfect (and again, what is perfection?).

 

[Zelig]

Kobe Bryant makes $61M per year.

That's American's fault for watching sports instead of doing something useful with their time.

Getting back to CEO pay, it's long established that their pay structures are flawed; that they do not provide adequate incentives; that the principal-agent problem remains very much alive. All of that is known, many papers were written about it, and all shareholders in the world know that. And they always try to address those issues. Several features of CEO compensation that are hated by many, such as golden parachutes, were invented precisely to address the principal-agent problem and other issues. So we all agree there are problems. But is the alternative superior? Is a magic number such as 50 ("the CEO should only make 50 times the median salary of his employees) any better? I think it's easy to demonstrate not. Or even worse, a magic wage limit ("nobody should make more than 1M per year"). It's simple to demonstrate those would lead to worse results than the market, hence our current wage-setting mechanism is superior, even if not perfect (and again, what is perfection?).

Maybe those specific methods of wage-setting, but I don't think it's at all simple to demonstrate that for generally lower CEO pay. As a shareholder in several major companies, I genuinely am of the opinion that both my short and long-term returns could be increased by offering lower executive compensation.

 

[luiz]

Intersubjectivity is a kind of subjectivity. It's simply not an individual subjectivity. Surely you understand the difference?

Yeah, Marx's labor theory is made somewhat subjective by the introduction of the qualifier "socially necessary" to labor as a requirement for adding value. Of course, determining what is "socially necessary" depends entirely on whether there is demand for the finished product. In this way, introducing the "socially necessary" qualifier into the labor theory of value simply converts the theory into a roundabout and imprecise description of supply and demand (as was noted a long long time ago by many different people).

So Marx's theory was wrong, which is why it's merely an intellectual curiosity nowadays, and not seriously considered capable of explaining our modern world.

 

[Traitorfish]

Yeah, Marx's labor theory is made somewhat subjective by the introduction of the qualifier "socially necessary" to labor as a requirement for adding value. Of course, determining what is "socially necessary" depends entirely on whether there is demand for the finished product. In this way, introducing the "socially necessary" qualifier into the labor theory of value simply converts the theory into a roundabout and imprecise description of supply and demand (as was noted a long long time ago by many different people).

I don't think you're grasping what he means by "socially necessary labour time". It refers to the average amount of labour needed to bring a particular commodity to market, the argument being that more efficient producers can thus afford to offer lower prices and/or increase profits, while less efficient producers will have to maintain uncompetitive prices or lose profits. It's not just an afterthought, and it certainly isn't intended to explain supply and demand, it's central to Marx's whole explanation of competition.

So Marx's theory was wrong, which is why it's merely an intellectual curiosity nowadays, and not seriously considered capable of explaining our modern world.

Your open-mindedness never fails to astound.

 

[luiz]

I don't think you're grasping what he means by "socially necessary labour time". It's not about supply and demand, but about the average amount of labour needed to bring a particular commodity to market. It's not just an afterthought, and it certainly isn't intended to explain supply and demand, it's central to Marx's whole explanation of competition.

I do understand it.
The most obvious objection to the LTV is that one can spend gigantic amounts of labor making a good that has no value to anyone, such as tying knots on a cord or digging holes in a field. The person may do it with the utmost efficiency, but it still creates no value (the same can be said about a factory making a good that nobody wants to buy). Obviously, simply adding labor to a good does not create any value, as those examples demonstrate. So the "simple" LTV does not hold even at the most superficial analysis, which is why Marx came up with the very ill-defined concept of "socially-necessary" labor time, which conceals subjective judgement.

IF we accept the "social-necessary" labor time qualifier as an answer to the criticism that labor by itself does not necessarily create any value, then as I said his LTV becomes simply a roundabout and imprecise description of supply and demand.

If we don't accept it as an answer, that is, if we assume that he did not mean to use that qualifier as an answer to that obvious criticism of the LTV, then as far as I know he had no other answer for it and his whole theory falls to the ground even quicker.

Your open-mindedness never fails to astound.

I am open minded; the simple fact that I've taken the time to read this ancient and very much obsolete philosopher attests as much. And I do encourage people to read him as a philosopher (preferably from secondary sources as much of his writing leaves a lot to be desired as far as clarity and objectivity go). But to try to apply his economic thinking , which was already quite flawed and old in his day, to our 21st Century economy is just... ridiculous. Which is why nobody does it, outside of very restricted and obscure circles in the academia and internet (this is the truth, like it or not). It's cult-like.

 

[Borachio]

Which is why nobody does it, outside of very restricted and obscure circles in the academia and internet (this is the truth, like it or not). It's cult-like.

I think that's largely true. Isn't that why we have neo-Marxists?

 

[Traitorfish]

I do understand it.
The most obvious objection to the LTV is that one can spend gigantic amounts of labor making a good that has no value to anyone, such as tying knots on a cord or digging holes in a field. The person may do it with the utmost efficiency, but it still creates no value (the same can be said about a factory making a good that nobody wants to buy). Obviously, simply adding labor to a good does not create any value, as those examples demonstrate. So the "simple" LTV does not hold even at the most superficial analysis, which is why Marx came up with the very ill-defined concept of "socially-necessary" labor time, which conceals subjective judgement.

IF we accept the "social-necessary" labor time qualifier as an answer to the criticism that labor by itself does not necessarily create any value, then as I said his LTV becomes simply a roundabout and imprecise description of supply and demand.

If we don't accept it as an answer, that is, if we assume that he did not mean to use that qualifier as an answer to that obvious criticism of the LTV, then as far as I know he had no other answer for it and his whole theory falls to the ground even quicker.


I am open minded; the simple fact that I've taken the time to read this ancient and very much obsolete philosopher attests as much. And I do encourage people to read him as a philosopher (preferably from secondary sources as much of his writing leaves a lot to be desired as far as clarity and objectivity go). But to try to apply his economic thinking , which was already quite flawed and old in his day, to our 21st Century economy is just... ridiculous. Which is why nobody does it, outside of very restricted and obscure circles in the academia and internet (this is the truth, like it or not). It's cult-like.

Eh. I've made the clarification I wanted to make. Not looking for a debate.

 

[luiz]

Eh. I've made the clarification I wanted to make. Not looking for a debate.

Fine by me.

This thread is anyway to discuss if there was sexism on GM's part, and the offshoot general discussion of CEO pay is also quite interesting.

The discussion of 19th Century cults is neither on topic or interesting.

 

[aelf]

This is a specious argument.

I've got to ask now what you mean by private ownership.

This might seem to be a rather stupid question, but even a cursory examination of modern society turns up a rather murky picture.

Generally speaking, most people will say that the shareholders own the means of production. But who are these shareholders? Often enough they're pension trust funds. And the owners of those trust funds are such a widespread and diffuse bunch of people there's really very little to differentiate the companies who rely on their funding, and hence are owned by them, from state run undertakings.

Then again, on the other side, under state ownership (if there is, or has ever been, such a "pure" system) who owns the means of production? Is it the people themselves or is it, in effect, the ruling elite?

What does it mean to own the means of production? Does it mean you can dispose of them just as you see fit; on a whim? Because that's not how a company that's been floated on the stockmarket works, is it?

Err, ownership of the means of production is not some concept that a couple of posters came up with here.

It doesn't matter who exactly owns the means of production if they're not the workers themselves - it would still be within the capitalist mode of production. Let's imagine a factory. Let's say 10% of the shares are owned by the family of the person who started it, 20% are owned by senior management and the rest are owned by external shareholders, be they pensioners, rich investors or even workers from other factories. Could you say that 'the people' own the means of production? Perhaps, if pensioners and average Joes own a majority of the factory's shares. But the workers clearly don't own the means of production, and that's the problem.