Soaring CEO salaries are big trouble

Here I am, posting a Margaret Wente column. Her sheer contrariness, not to mention her privileged viewpoint that she rarely acknowledges, generally rub me the wrong way. But today she wrote on an issue that we obviously share indignation over: The soaring pay of Canada's CEOs.
As she notes in the column, a private company has the right to pay its boss whatever it wants. But tying salaries to stock options has screwed things up. It motivates CEOs to do things for all the wrong reasons. And with governments now tying their own managerial salaries to private-sector salaries, things are getting way out of hand.
And here's the TC's editorial from yesterday on the same subject: Both the editorial and Wente's column are based on a new report from the Canadian Centre for Policy Alternatives. 

Rising inequality demands debate

 

 

TIMES COLONISTJANUARY 4, 2012

 

 

How much is too much? It's time to ask that question about income inequality in our society.

The Canadian Centre for Policy Alternatives cleverly frames the issue with an annual New Year's look at the compensation for 100 corporate CEOs compared with the average Canadian.

The CEOs, the centre reported, had earned as much as the average Canadian makes in a year by noon on Tuesday, the second working day of the year.

Their average compensation jumped 27 per cent in 2010, to $8.4 million. The average income for Canadians increased 1.1 per cent, to $44,366.

The increase might reflect improving corporate performance. But the gap has been growing steadily in recent decades. In 1995, for example, the average compensation for the 50 highest-paid Canadian CEOs was $2.66 million, 85 times the pay of the average worker.

By 2010, the average for the 50 was $11.3 million, 255 times the pay of the average worker.

Put another way, the average Canadian salary grew by about 2.4 per cent a year. The average for the 50 CEOs, through good times and bad, was 10.5 per cent a year.

Two arguments have been used to justify the increasing share of corporate revenues claimed by those at the top. The compensation reflects market forces, defenders argue. Just as Robert Luongo can command $6.7 million from the Canucks because he offers scarce and valuable skills, so can top executives demand big pay.

The second claim is that only shareholders should care care about executive compensation, as it's their money.

It's not that simple. Luongo's pay is determined by the market, but free agency rules, team salary caps and other factors all provide checks and balances. The process is, at least, transparent.

Compensation for top executives is supposedly set by market forces. But the market appears rigged. Those who determine pay - boards of directors - tend to benefit themselves as executives' pay increases, because corporations develop pay plans by surveying compensation at other companies. Many directors are in similar positions with other corporations, or directors on several boards. Rising compensation means increases for them as well.

And shareholders are rarely given the chance to protect their interests when it comes to compensation.

Of course, answering the first question - how much is too much - raises a second one. What is to be done if we decide this trend is damaging our society?

There are policy responses which would introduce market discipline without interfering with corporations' ability to set compensation levels. Shareholder rights, both to detailed information on compensation plans and to a direct say, could be strengthened. Shareholders, for example, could be required to approve any compensation plan that provides increases greater than a set percentage. Greater independence for directors could be mandated.

Alternatively, government could use its redistributive powers to level the playing field. The centre notes, for example, that CEOs increasingly take their payment in stock options, taxed at half the rate of income.

The growing inequality demands, at least, a public debate. The Organization for Economic Cooperation and Development reported last month that income inequality continues to increase in Canada and around the world. Government policies have ensured that those with high incomes claim a larger share of the country's wealth, while reducing the share earned by the rest of Canadians.

The trickle-down approach hasn't worked, said OECD secretary-general Angel Gurría. "Without a comprehensive strategy for inclusive growth, inequality will continue to rise."

And without such a strategy, the OECD warned, "the social contract is starting to unravel in many countries."

Our ability to function as a society is based on that social contract, which assumes the game is not rigged to favour a fortunate few. When it starts to break down, serious trouble lies ahead.

New hospital policy not much of a fix

Well, this story from today's Victoria Times Colonist certainly does raise more questions than it answers. 

I can't decide which is my favourite outrageous fact - that VIHA thinks things will be fixed now just because its new policy establishes there will be at least two women in any mixed-gender hospital room (how does adding an extra woman prevent a patient from being assaulted by one of the two men who might also be in the same room?), or the revelation that the OLD policy had no provisions for ensuring "patients with known violent behaviour, mental health issues or known tendencies to inappropriate sexual behaviour" weren't being placed in mixed-gender rooms. 

Come to think of it, that last point is much bigger than gender. Is the hospital telling us they don't even consider big stuff like that before packing patients into a four-bed ward with strangers? 

I get that the mixed-gender wards are a more effective use of hospital space, and that there's no guarantee of safety anyway just because you're in a room where everyone is the same gender. But people are really vulnerable when they're sick enough to be in the hospital. They need to know that those in charge have thoughtful and realistic policies and practices for keeping them safe. 

Assault of 83-year-old woman in Island hospital prompts policy change

Mixed-gender rooms to be limited after elderly woman attacked in bed

BY JUDITH LAVOIE, TIMES COLONISTJANUARY 3, 2012 6:15 AM

Vancouver Island Health Authority has said it will limit mixed-gender rooms after an 83-year-old woman with dementia was sexually assaulted by another patient at Cowichan District Hospital.

The woman, who was taken to hospital Dec. 19 after a fall, was in a fourbed room with two men when she was assaulted.

"I can't say enough about how truly horrified we are that this happened," said VIHA spokeswoman Moira McLean.

"VIHA is doing a full review of the incident. We have no tolerance for any sort of violence and we are absolutely horrified this would happen in one of our facilities."

Staff at Cowichan District Hospital were alerted to the assault after a medication alarm was activated.

The RCMP special victims unit was called by staff and a 48-year-old man was placed under guard in another room. The suspect was released from hospital into police custody.

North Cowichan-Duncan RCMP could not be contacted Monday and it is not yet known if the man has been charged.

As a result of the incident, policies and procedures on mixed-gender rooms are now being formalized, McLean said.

The new rules will require patients in semiprivate rooms with two beds to be the same gender.

Every effort will be made to separate men and women in three-and fourbed rooms, but when mixed-gender rooms are necessary, there will be a minimum of two women per room, said the health authority.

"It will also be required that patients in mixed-gender rooms are alert, oriented, mentally competent and have the ability to appropriately vocalize concerns," McLean said.

Patients with known violent behaviour, mental health issues or known tendencies to inappropriate sexual behaviour will not be placed in mixed-gender rooms under the new policies.

The new rules would have prevented the woman who was assaulted from being placed in a mixed-gender room.

Even though the policies are not yet formalized, efforts are always made to place patients in genderappropriate rooms, McLean said. "But at times, if there is high volume, people are put in mixed-gender rooms. It's not uncommon and it happens in hospitals across the country," she said.

At the new Patient Care Centre at the Royal Jubilee Hospital, 85 per cent of beds are in single rooms and the remainder are twobed rooms.

"As we move to replace facilities, that's what's coming down the road, but when you have older facilities like Cowichan District Hospital, Nanaimo and Victoria General Hospital, some are three-and fourbed rooms and sometimes it's unavoidable to have mixed genders," McLean said.

Pack rats and ditchers: In search of common ground

A blog reader asked me if I had any advice for finding common ground between pack rat and ditcher, given that is exactly what is being attempted in our house at this moment as we fold the place up.
I'm the ditcher, the one who has no problem getting rid of things. Keep that in mind when reading this, because I fully acknowledge it's from a ditcher's perspective.
And let's presume I'm giving this advice for a pack rat-ditcher couple in which the pack rat does want the end result, even though it's going to be painful getting there.
I've got nothing against pack rats as as general rule, but if you want to fold up your house in order to be able to travel the world freely, then it's pretty clear that a ditcher ethos simply has to prevail. So a motivated pack rat is essential. I have no idea how you'd convince a pack rat to part with their stuff if they'd yet to buy into the concept.
OK, advice.
First, the ditcher has to recognize that it's going to be a struggle all the way, and that they need to prepare themselves mentally for the challenge ahead. If Paul and I had been a new couple going through this process of giving stuff up, I think we might have broken up by now.
But I've known Paul for long enough that I was really aware of how tough this was going to be for him. I knew I'd have to be very, very mellow and non-pushy - not my natural state - through this process.
Step two: Recognize that the ditcher does most of the work of the downsizing.  Maybe that's unfair, but it's just the way it is. If you want something more than the other person, you will have to be the one who makes the most effort.
Step three: Give your pack rat some options. There are a lot of different choices available when you're getting rid of stuff, and pack rats seem to feel better about giving away their things if they're not just going to get dumped, but are going on to new lives with family, acquaintances or people in need.
And finally, check your own expectations. Sometimes I catch myself getting heated up over an item too inconsequential to make a whit of difference in terms of the storage space it'll take up. Ditcher, don't sweat the small stuff.
Good luck. With two weeks to go in our household, we are on track to fit the stuff of our lives into a 6x8 storage locker. But I'd be lying if I said it has been easy.

Could be the end of the world as we know it (or not)

I find it kind of sweet that people still get caught up in a good old-fashioned doomsday prophecy once in a while.

It’s difficult to be certain of anything in this world, so I don’t mean to poke fun at those who believe the apocalypse is coming in 2012. It could be.

But what’s charming is that the belief has gained so much traction that even the well-regarded Guardian newspaper in London, England felt the need to run a rather serious story this month featuring a German scholar disputing rumours that the end is nigh.

I like that.  We seem all sophisticated and rational as a society, but just below the surface is a wide-eyed kid who still believes in things that go bump in the night. Prepare for a good year on that front regardless of what’s up with the apocalypse, seeing as the ancient Mayans aren’t the only ones predicting intense times in 2012.

It seems perverse to wish for disaster. But working ourselves up about a possible apocalypse is obviously something humans enjoy every now and then, and we do it well. Who can forget Y2K?

The 2012 doomsday prophesy revolves around a stone tablet carved by an ancient Mayan civilization from the Tortuguero region of Mexico. The tablet marks 2012 as the end of a 5,125-year cycle of the Mayan long-count calendar.

Some have taken that as indication that the world will cease to exist as of Dec. 21, 2012. Of course, you have to put a lot of faith in ancient Mayans to believe that. But that’s the thing about faith - it doesn’t need to make sense.

At any rate, the scholar quoted in the Dec. 1 Guardian article disputed that interpretation of the tablet writings.

Sven Gronemeyer contends the tablet is too damaged to make out some of the words written on it. He says the legible part in fact says what lies ahead is a return of the mysterious Mayan god Bolon Yokte. His arrival is said to mark the end of 13 consecutive periods in the Mayan calendar that each lasted 400 years.

Oddly enough, my partner and I will have a front-row seat for whatever action awaits when the fateful day - Dec. 21, 2012 - rolls around. We will have been in Honduras for almost a year by that point, on a placement with Cuso International in the very town that Honduran President Porfirio Lobo has singled out for a tourism happening tied into the Mayan prediction.

We’ll be in Copan Ruinas, the site of major Mayan ruins. Government hopes visitors pour into the town for the “countdown to the end of time,” giving the flagging Honduras tourism economy a boost along the way. Whatever awaits - Bolon Yokte, the end of days, or more likely just some big, wild party - we’re going to be smack-dab in the middle of it. 

A B.C. soothsayer warns of other shakeups closer to home in 2012. Georgia Nicholls, the Vancouver astrologist who writes a newspaper horoscope column, says “fiery Mars” will preside over all signs for most of the year. This is apparently a very unusual development.

She advises us to prepare for much more cosmic energy bouncing around next year. That’s neither good nor bad on its own, adds Nicholls, but the challenge is in managing all that extra energy.

Nicholls cautioned Sagittarians like me to ease up in 2012 on their tendency to resist authority. I am taking that to heart. It’s a reminder that I will soon be working in an unfamiliar culture, political structure and language, and will need to be the nicest, most easy-going version of myself.

There does seem to be agreement among the ancient Mayans, the astrologists and the Chinese that 2012 is shaping up to be a corker.

According to Chinese astrology, the 12-month period starting Feb. 4 is the year of the black water dragon. That heralds a year of uncertainty and unexpected developments.

“You can have either bad luck or good luck in 2012, and will have a chance to turn it into better or worse luck,” noted one Chinese horoscope site. Gulp.

But if it’s really all over next December, luck is the least of our worries anyway. Have a world-shaking year, and maybe Bolon Yokte and I will see you in Copan Ruinas.

It's all about the piles

I don't know what my new life will be like once we get to Honduras, but right now it seems to be about sorting. That and studying Spanish fill what I used to call "spare time" - the blocks of time in my life when I could do fun things like bird-watching or spend a leisurely couple of hours at the gym.
Now, there's only sorting and Spanish, although they have their own charms. Newly able to understand at least most of what I read in the Honduran on-line newspaper I've been checking out, I'm very happy to be finally making good on years of empty promises to myself that I would learn Spanish. But I've been hard at it for almost two months now and taking a two-hour private lesson every week as well, so no surprise that my birding time has suffered. So it goes.
The demands of sorting are multi-layered. First, you sort just to put like with like - tools over here, art materials over there, miscellaneous (and oh, there's so much miscellaneous) over by the wall.
Then you sort the newly sorted stuff into smaller piles: This one to store; this one to give away to family; this one for donation; this one to ditch. I'm an aggressive ditcher and my partner is right on the edge of being a hoarder, so you can imagine how pleasant that aspect of things has been.
The out-bound stuff then gets loaded into the back of my truck and off it goes to whatever the final destination, freeing up space in the basement for the next round of sorting. And on and on it goes. I feel the pressure of our Jan. 15 departure quite acutely at this point, but I've had to be careful not to be too efficient, or the next thing you know I've given away something we'll actually need between now and then.
The cabinet that housed our wine glasses and liquor went on its way today, up-Island to its new home in my son's house. The homeless liquor bottles are stacked on the floor in the dining room now, so much in our way that it's as if they're daring us to drink them up before we fly away. Well, if that's the way it has to be.