[delackner]

Rising wealth inequality is not in itself a bad thing, but the many hundred-fold increases in executive compensation over the past 20 years have nothing to do with results, performance, profits, etc. They are the result of a broken system of corporate governance that puts the interests of executives and the interests of shareholders at odds.

[yummyfajitas]

So what is the cause of the hundred-fold increases in compensation for athletes and musicians?

[OstiaAntica]

Television and expanded marketing opportunities, for athletes.

I suspect that musicians are earning less than they did a decade or two ago. There's no way for a Michael Jackson to sell a Thriller album in today's fragmented, digital marketplace.

[cyrus_]

An athlete's or musician's salary is linked to their performance on the playing field or in the market. The people writing their paychecks are not themselves musicians or athletes. Executives, on the other hand, often make huge amounts of money even if their company is tanking. The people writing their checks -- members of the board -- are themselves executives. Perhaps they are subconsciously conspiring to keep prices high for their services?

It doesn't have to be this way. Germany requires that the board includes employees. Japan has also succeeded, perhaps by applying social pressure, in keeping executive salaries reasonable in most cases.

[yummyfajitas]

CEO pay is usually linked to performance as well. Most are paid primarily in stock options or performance linked bonuses.

Unless you want to claim that Lady Gaga's performance is superior to that of Johnny Cash, I don't think you can explain the increase in musician pay by performance increases.

[cyrus_]

Its not about who is a better musician, its about who can sell more albums, concert tickets, etc. In that respect, Lady Gaga knows how to work pop culture like few others.

[delackner]

I'll leave the details there up to people more knowledgeable in sports and music, but are you saying you think the system is working well when many CEOs steering their companies to destruction yield massive guaranteed compensation packages that are totally disconnected from performance?

I'm all for paying people whatever it takes, even if that means some people make previously insane sums of money. But they should have to make their company MORE profitable, not less.

[yummyfajitas]

No, I'm saying that if you observe the same phenomenon in a variety of areas, an explanation which only applies to one area is unconvincing.

[delackner]

That doesn't make any sense. The vast majority of highly skilled or highly sought-after professions saw modest but nice increases in wealth decade over decade. Only a very specific FEW saw multiple hundred-fold increases, making them the odd outliers away from the general trend.