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“Morally wrong,” is how United Auto Worker president Bob King described last year’s paygrab by one worker at Ford Motor Co. And this year, that worker has grabbed even more, hauling off a $21-million paycheck.
Alan Mulally is the worker in question. Ford’s CEO, he has now pocketed more than $300 million in his six years as the carmaker’s top employee – a period in which he forced fellow workers to swallow big losses in wages and healthcare benefits. The chief’s gain and their loss means Mulally is rewarding himself with a salary that’s about 360 times the wages of the typical Ford automaker, meaning Alan thinks he is worth 360 times more than the people who actually make the product.
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In addition to King, he should ask Peter Drucker about that. Well, he can’t for Drucker died in 2005, but Mulally could read up on what this solid thinker had to say about executive pay. Drucker was (and still is) a world-renowned management guru, author, level-headed social observer, teacher, and expert on the role of corporations in society.
As a Bloomberg Businessweek writer noted in 2008, Drucker “hated high CEO pay on every level: what it said about the individual as a leader, how it undermined the smooth functioning of the organization, and the way it tore at the fabric of society as a whole.” The chief executive Drucker pointed out, is “just a hired hand” who ought not take more than 20 to 25 times the average pay that other workers get.
As for prancing chieftains like Mulally who profit personally by taking paychecks from fellow employees, Drucker was blunt: “There’s no excuse for it. No justification. This is morally and socially unforgivable.”
What a better place America could be if our economic and political leaders showed a little more Drucker, and a whole lot less Mulally.
“Meet the CEO Who Cut Worker Pay in Half While Pulling in $21 Million Last Year,” www.alternet.org, March 25, 2013.
“Ford CEO Mulally’s $317 million haul,” www.cnn.com, March 7, 2013.
“Heinz CEO due$212.6 million golden parachute,” www.cnn.com, March 5, 2013.
“Put a cap on CEO pay,” www.businessweek.com, September 12, 2008.
“Peter Drucker’s revolutionary teachings decades old but still fresh,” www.latimes.com, December 31, 2009.
“Ford Hourly,” www.uaw.org, October 2011.
“Autoworkers Earning Less in U.S. Happy to Compete Again,” www.bloomberg.com, October 18, 2013.