As chief executive of Apple Inc., Steve Jobs led the company he co-founded from the brink of ruin in the mid-1990s to global dominance by 2010. Awestruck fans watched as its market cap surged to a staggering $241.5 billion last year, beating Microsoft’s $239.5 billion to make it the largest technology company on the planet.
In just over a decade, the indefatigable Jobs turned an also-ran computer manufacturer into a worldwide cultural phenomenon — while earning an official salary of just $1.
Consider that for a minute. Even as Apple grew to one of the most prosperous corporations around, its top executive was compensated only through his holdings in company stock.
It’s what business school types call the “alignment hypothesis” — CEOs who align their wealth with the company’s success are most driven to pursue robust growth; as the company’s shares appreciate, so do their personal fortunes. Think of it as a mechanism to guarantee accountability to stockholders.
It might make sense to apply similar compensation standards to elected officials in Congress, especially as the renegade institution becomes less accountable to its shareholders — the American people. After all, aren’t taxpayers like investors who have a real interest in how government performs? Why should they be saddled with the burden of compensating bad managers who can generally be fired only every few years?
At a time when Congress’ job approval ratings are lingering near an abysmal 20 percent — with disapproval up to an average of 73.4 percent — why should members of Congress be entitled to salaries and fringe benefits that far exceed those of the average American?
The current compensation package, The Heritage Foundation’s Mike Brownfield points out, is lavish beyond reason. Members of Congress earning a salary of $174,000 per year make 3.4 times more than the average full-time American worker. “Even if you compare Members of Congress to more educated, private sector employees, they’re still doing pretty well — those Americans earn on average $83,000 per year according to the Bureau of Labor Statistics.”
That’s not all. “If you count the $110,000 in taxpayer-funded fringe benefits members receive (including plush retirement plans, paid time off, and contributions to Social Security and Medicare taxes), they’re earning close to $285,000 per year.”
That makes Washington lawmakers “the second highest paid internationally,” second only to Japan — another politically dysfunctional developed state, where government debt exceeds 200 percent of GDP.
At Apple, according to the Associated Press, top executives, including Jobs, “are employed at will, without severance or employment agreements, tax reimbursements or supplemental retirement benefits. The company also does not provide perks to the executives other than those available to non-executive employees.”
And Apple, in July, had more cash on hand than the U.S. Treasury.
If a profitable corporation doesn’t spoil its executives, why should the American taxpayer pamper failing lawmakers who volunteer to be public servants? Does this not make our representatives less like us — and therefore unable to champion our best interests in government? How can such a system of compensation possibly advance American democracy?
Alas, our self-interested public officials seem completely incapable of statesmanship. So instead of talking about a pay cut, some are actually clamoring for a raise . As freshman Rep. Steve Southerland, R-Fla., recently put it to a retirement community in Tallahassee: “If you took the hours that I work and divided it into my pay, the $174,000 salary would not seem so high.”
Could someone please hand the telephone to Donald Trump?