Lies, Damnable Lies, Statistics, and the ‘CEOs Make 300 Times The Average Worker” Bullshit

Jesus H. Tap-Dancing Christ, people. Stop accepting this nonsense as if it’s true. It’s a lie. Are we that fucking intellectually-lazy?

It’s a lie because the “CEOs” (which, contrasted with “the average worker,” is meant to imply the average CEO) being discussed are a mere handful of the highest paid CEOs leading publicly-traded companies.

AEI, May 2014 (emphasis and links in original):

While the huge multi-million pay packages of a few hundred CEOs get all of the media attention, what usually receives much less attention is the small number of CEOs represented in the annual salary surveys, especially compared to the total number of CEOs in the US. For example, the WSJ’s survey included only 300 CEOs at large, U.S.-traded public companies, and the AP analyzed compensation figures for only 337 companies in the S&P 500. An analysis of CEO pay by USA Today in April looked at only 200 CEOs in the S&P500. The AFL-CIO did an analysis of the CEOs of 350 companies in the S&P500 and then computed a “CEO-to-worker pay ratio” of 331 times ($11,700,000 average annual CEO pay to the $35,239 average annual worker pay), up from a ratio of 300 ten years ago and 200 twenty years ago.

Although these samples of 200-350 CEOs are representative of large, publicly-traded US companies, they certainly aren’t very representative of the average US company or the average US CEO. According to the US Census Bureau, there are more than 27 million private firms in the US, so the samples of 200-350 firms for CEO pay represent only one of about every 100,000 private firms in the US, or about 1/1000 of 1% of the total firms. And yet the AFL-CIO, AP and others compare the average annual wages of hundreds of millions of full-time employees working at the more than 27 million US companies to the CEO pay of executives at only several hundred companies, which is hardly a fair comparison.

Also, a screencap from the BLS:

BLS-AllOccupationsVersusCEO

 

 

 

So aside from performance-based compensation presumably not included in the averages above, the ratio is less than 4-to-1.

Also, note that the over a quarter-million CEOs, per BLS, is nearly 1,000 times larger a sample population than is thrown around by the Left–and thrown around in such a way as to leave the casual reader with the impression that they are talking about the average CEO.

If we can’t shoot down bullshit like this, we deserve to lose. Hear me? We deserve to lose if we can’t address something so damned simple.

And stop blaming the MSM for our intellectual-laziness on this topic. It’s pathetic.

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