The way that one solves cultural problems is mainly by talking about them. If enough people are saying, "Hey, this prohibition thing doesn't work," and do it for long enough, then eventually the unquestioned cultural assumptions dissolve.

So my question for you is: why are you standing in the way of people doing something about it by being a jerk?

[1] http://en.wikipedia.org/wiki/Managerialism

[2] http://www.amazon.com/Confronting-Managerialism-Business-Eco...

Managerial pay has gone up not because executives are hundreds of times smarter or more competent than a couple generations back. It's because the cultural notion of executives as a higher corporate caste has become much stronger.

In other words, it's not that we rationally measured the value of CEOs and paid them accordingly. It's that we stopped really thinking about it. In, more ore less, the same way that people stopped thinking rationally about drugs for some decades. The change in marijuana laws in the US is now happening not because of new facts, but because of new attitudes.

A shift away from managerialist thinking might similarly trigger new laws. But I doubt it will work the other way around. Especially given the new research showing that laws basically respond only to the interest of rich people and businesses: http://www.princeton.edu/~mgilens/Gilens%20homepage%20materi...

I think it has a reasonable chance of working for managerialism over the next couple of decades for a few reasons.

One is the giant spike in inequality. The elite are capturing more and more of the money, causing more and more resentment.

Another is the shift in public communication. For a while, most of the information people received was filtered through mass media. The internet has made it much harder for moneyed interests to dominate what people see. HN is a great example; I'll probably read 5x the words from commenters versus the original article, and much of it is contrary or probing. And a lot of what is linked here is not commercial media; it's individuals publishing directly.

A third is a shift in communication costs. Large companies had a major advantage when communication was hard and expensive. But now that it's free and easy, people have less need to work in highly controlled corporate structures. Thus the rise in freelancing and entrepreneurship. It also makes it much easier for people to switch jobs, reducing the effective power of a managerial elite.

I think those together are having interesting effects. It's my hope that we'll shift back toward seeing executives as stewards of valuable organizations of people, and less treating them as magic sources of all value.

This is a suboptimum outcome, in our opinion. Watching inequality rise dramatically over a few short decades only bolsters the belief that these are suboptimal outcomes.

And watching these unmeritorious fools perform poorly while being paid thousands of times the average pay of their own staff is disheartening. It's obviously not a meritocracy. It's obvious that the extravagant, suboptimal pay scheme isn't buying quality leadership, nor is it rewarding any kind of out-sized risk on the part of management. Tiny risk compared to venture or entrepreneur, small or negative benefit, massive reward.

They bill it as "The US is more of an oligarchy than democracy" because those very few >0.1% of Americans have a greater political say than the rest of us.

If Coke is earning so much money and misbehaving, let's patronize other soda companies!

If Yahoo is doing the same, let's spread out to other mail and search providers!

Not really. If you earn $120k a year (just over 6 figures) you're in the top 10% of income earners in the US. The fact that you think they're 'middle class' (and relatively speaking, I don't think you're wrong) is indicative of how bad the wealth gap has gotten.

Source: http://en.wikipedia.org/wiki/American_middle_class#Academic_...

Still, I think your source really just proves my point: by no means is anyone earning 120K a year "solidly middle class". By pretty much all of the definitions you listed, 120K a year would either be "upper middle class", or "the rich" (e.g. find me a homeowner in SF who doesn't have >1 million in home equity).

I was with you until this part. You can't just tell people they don't need their current resident city or country or what schools they(or their children) need.

Running away from a problem is almost never the right solution.

And it is absurd to claim that I am advocating running away from a problem. I absolutely want you to tackle the problem head-on. But by voluntarily enriching the aristocracy, you are part of the problem. So I find it painfully hypocritical to complain about your bosses earning too much, while at the same time choosing to be their employee.

I agree with that sentiment, it's the advice I generally give people who are in a bad situation. But if you look at it from the country's perspective it feels like avoiding the problem, and isn't a solution.

Your question about what I'm doing about it is fair, so here goes another rant. As a manager, my feet are held to the fire every day, and my compensation is 100% formulaic. If I don't perform well, I don't get paid well, PERIOD. My pay isn't subjective, or based on what Ken Griffin earned. I have put in measures that ensure I cannot get rich for simply "showing up". Do you know what else I did? I did something that almost no other hedge fund manager in the country does, which was put in a clawback. (My auditor, who did about 2,000 hedge fund audits last year, told me exact two other fund have this) If I make money in year 1 and lose money in year 2, I will end up giving back possibly a significant portion of my year 1 fees to my investors. Why should I get to get rich from one great year, then suck afterwards with no consequences? In my industry at least, I'm doing more than 99.9% of people to fix the problems.

I WANT my incentives to be aligned. I WANT to make a lot of money, but I refuse to do it without merit or in a way that I can't feel good about explaining it to my kids. So I guess that's why I'm so maddened by the executive comp bubble, because I am trying to do something about it.

> what are you doing about it? Are you continuing to feed the machine by working as one of their employees? Are you participating by trying to create an aqui-hirable startup? Or are you pushing to enact change?

The nature of this imbalance is a positive (self-reinforcing) feedback loop. Power begets power (and lack of it begets a deeper deficit). Again, we're back to square 1 - explosive social upheaval.

Human nature sucks.

It's different than the typical asset bubble in that most of the people setting executive pay are also executives. But it could still just as well be a bubble.

If so, it's a special kind of asset, that can dictate the conditions of its own "usage".

Doesn't an executive's ability to convince a company to pay 200k/day fluctuate based on market forces just like how people price homes or tulip bulbs?

Good luck convincing all of the underpaid $120k/yr salaried engineers, though. 95% of the world would kill to live in the cozy little bubble of tech, but that doesn't matter because those other guys over there are getting even more.

No matter how much you have, you always want more.