In the past 40 years, top corporate executives in the U.S. have seen a compensation rise of 1000%. This number is shocking compared to the 11.9% pay rise among average workers during the same period. [1] This unusual trend has sparked debates about the legitimacy of such compensation. Some politicians have called for new tax policies to rein in the widening pay gap. Studies have proven their concerns. The current CEO compensation in the U.S. stems from illegitimate reasons, distorts the labor market, and exacerbates inequality. Thus, CEOs in the United States receive too much compensation. CEOs do not deserve such inflated compensation. Many scholars have debated the cause of this fast paycheck rise. Some have justified the phenomenon as market outcomes. Technological changes, they argue, have enabled CEOs to increase their marginal productivity. [2] However, some point to these CEOs’ less-paid international peers as proof of non-market factors. Instead, the pay rise likely stems from managerial rent-seeking. CEOs have used their power to pursue higher compensation. [3] Therefore, CEOs do not contribute enough productivity to deserve their elevated compensation. The elevated CEO compensation distorts the entire labor market. The rent-seeking behaviors produce repercussions beyond the corporate executive corner in the labor market. The elevated CEO compensation also forces corporates to increase the pay of other high positions. To compete with these corporations for talents, many other organizations also have to increase their compensation for top executives. These organizations could include universities, private charities, and foundations. Furthermore, the tempting compensation encourages the “revolving door’ problem. Officials in government regulatory agencies may take jobs in industries in their jurisdiction. This phenomenon can exasperate insider trading and diminish government integrity.[4] Thus, the abnormal CEO compensation has negatively impacted the entire labor market. The high CEO compensation increases inequality. In 1965, the CEO-to-worker compensation ratio was 20-to-1. By 2018, it had risen to 278-to-1. This shocking change has widened the socio-economic gap between top earners and average workers. Furthermore, the widening happens on both fronts. The extra rents to CEOs and other top positions represent a transfer of financial resources. In other words, the money could have gone to the wages of average workers. [5] Thus, the rise of CEO compensation hurts workers and exasperates economic inequality, both explicitly and implicitly. For these reasons, CEOs in the United States receive too much compensation. [1]. Cox, Jeff. 2019. "Ceos See Pay Grow 1,000% In The Last 40 Years, Now Make 278 Times The Average Worker". CNBC News. https://www.cnbc.com/2019/08/16/ceos-see-pay-grow-1000percent-and-now-make-278-times-the-average-worker.html. [2]. Kaplan, Steven N, and Joshua Rauh. 2013. "It's The Market: The Broad-Based Rise In The Return To Top Talent". Journal Of Economic Perspectives 27 (3): 35-56. doi:10.1257/jep.27.3.35. [3]. Bivens, Josh, and Lawrence Mishel. 2013. "The Pay Of Corporate Executives And Financial Professionals As Evidence Of Rents In Top 1 Percent Incomes". Journal Of Economic Perspectives 27 (3): 57-78. doi:10.1257/jep.27.3.57. [4]. Baker, Dean, Josh Bivens, and Jessica Schieder. 2019. "Reining In CEO Compensation And Curbing The Rise Of Inequality". Economic Policy Institute. https://www.epi.org/publication/reining-in-ceo-compensation-and-curbing-the-rise-of-inequality. [5]. Mishel, Lawrence, and Julia Wolfe. 2019. "CEO Compensation Has Grown 940% Since 1978". Economic Policy Institute. https://www.epi.org/publication/ceo-compensation-2018/.

**Employee compensation should be a reflection of their work ethic and the time they’ve dedicated.** If you are the CEO of a small startup company, no investors, no one’s backing you, and you’re essentially a one-man band, then logically you deserve a larger compensation than any other employee. On the flip side, a big-time CEO getting paid [320 times more](https://www.nytimes.com/2021/05/11/learning/are-ceos-paid-too-much.html#:~:text=The%20article%20continues%3A,to%20the%20Economic%20Policy%20Institute.) than their company’s average employee isn't anywhere near the realm of being reasonable. It’s somewhat easier for society to wrap their head around a curio CEO like Elon Musk reining in a substantially larger amount of income than his workforce, a staggering [40,000 times more](https://www.peoplesworld.org/article/elon-musks-compensation-is-40000-times-more-than-average-tesla-worker/), because he’s not run-of-the-mill. However, the enormous pay gap between an average well-off company’s CEO is still hundreds of times higher than its standard employees. These gaping pay scales are becoming a common trend that is creating a fundamental imbalance. A CEO’s salary often [correlates to a company’s size](https://chiefexecutive.net/wp-content/uploads/2014/08/CEO_CompReport_ExecSummary_2014.pdf), not its success, exacerbating the expansive difference in pay to that of their coworkers. To see this inequality perfectly exemplified, simply look at massive corporations like Yum Brand, and Foot Locker. During the pandemic, [Yum Brand](https://www.reuters.com/business/worst-paying-blue-chip-employers-bolstered-ceo-pay-pandemic-report-says-2021-05-11/), the umbrella company for brands like Taco Bell, and KFC, was forced to close down branches nationwide, yet still awarded its CEO a multi-million dollar bonus. Then there's Foot Locker, who furloughed nearly all of its staff without pay in April 2020, while at the same time awarding their CEOs with a [30% pay raise](https://www.cbsnews.com/news/some-ceos-are-getting-paid-bonuses-like-there-was-no-pandemic/). It is imperative that pay distribution be leveled. The continuation of income disparity is toxic and will only lead to economic ruin.

I am more concenred with poloticians who provide no service nor produce no goods that become filthy rich and corrupt of their position then CEO's.