I have an idea for all these corporate CEOs who want to outsource American labor to cheaper foreign countries: Outsource the CEOs as well.
There has been an epidemic of companies that are closing their US plants and moving the work overseas, primarily to China and the Far East, because labor is a fraction of what it is here.
If labor is so much cheaper in China, certainly management would be as well. Why don't these corporations outsource their executives as well? Surely there are top-notch Chinese managers who could run the company every bit as profitably as their American counterparts &emdash; at a fraction of the cost.
Ralph Hake, the CEO of Maytag, makes millions each year in salary, bonuses and stock options while he's telling his employees production must be shifted to lower cost countries like Mexico and China.
The same is true for Wal-Mart, which browbeats its suppliers to manufacture goods in China so prices can be cut in its US stores. Has Lee Scott, the CEO of Wal-Mart, or any member of the Walton family taken a pay cut as well? I'm a-doubtin' it. If Scott thinks China is such a wonderful place, then why doesn't he move his family there and work for 1/100th of what he makes here?
If business today is all about maximizing shareholder value &emdash; as we constantly hear from Wall Street analysts &emdash; then let these companies find the cheapest executives on the planet as well.
Delphi, the automotive parts supplier teetering on bankruptcy, wants to cut the wages and benefits of its US employees by up to 75%, while the executives who got the company into this mess are busy awarding themselves bonuses of nearly a half billion dollars, according to the Wall Street Journal.
Look at any company trying to cut workers' wages and you'll find executives getting filthy rich.
These corporate thieves cut pay and benefits for good, hard-working Americans, shift the jobs overseas, plunge the companies into bankruptcy and float to safety with their golden parachutes.
American business might be run a whole lot more efficiently if executives had to take the same pay cuts as workers.
One shining counterpoint is the discount wholesaler Costco, which is headquartered near Seattle, Wash. Jim Sinegal, the company's CEO, is paid $350,000, a fraction of what he'd earn elsewhere. But employees are paid more than double what other similar operations like Sam's Club pay. Cashiers can make $40,000 per year plus good benefits. Sinegal says paying employees more is a good investment because it reduces turnover and keeps skilled employees on the job, which ultimately is more cost-effective for the company. Of course, Wall Street analysts think Costco should cut pay to the average worker to increase short-term profits. Sinegal replies that analysts are only worried about next Tuesday, while he's trying to build a company that will last for years. Fortunately, Costco is making plenty of money because it has found that paying good wages is essential to running a profitable company.
If only the greedy executives at some of these other troubled companies could have learned that lesson in MBA school.
John Cullen is publisher of The Progressive Populist.