If Americans fully understood how bad economic inequality is in this country, would the reaction make CEOs and bankers look gratefully at Bernie Sanders’ moderate rhetoric? Because, boy, the average person really doesn’t know how much CEOs are making:
A survey of 1,200 individuals released Thursday shows that the median respondent said [CEOs of large companies] make just $1 million a year.
The right answer? More than 10 times more than the typical guess: $10.3 million.
That underestimation of what the CEOs of America's 500-largest companies make is not reserved for the less well-off, either. While lower income respondents (those making less than $20,000 a year) vastly underestimated how CEOs get paid -- their median response was $500,000 -- even those who make more than $150,000 a year were wrong by half, guessing the corporate brass take home $5 million a year.
The median household income was a little less than $54,000 in 2014, by the way. That’s per household, notice, not per working adult. Could you blame people for thinking fondly of pitchforks and torches? But instead, this astonishing inequality doesn’t fully register—maybe people can’t quite wrap their minds around how big it is—yet people still think inequality is too high. According to this study, “The vast majority (74 percent) of Americans believe that CEOs are not paid the correct amount relative to the average worker.”
Will things change anytime soon? Information about inequality will become a little more available:
The average American will soon get a better idea of what the ratio of CEO-to-worker pay really is when new SEC rules go into effect and companies have to start calculating those figures in 2017. Companies will have to report this simple piece of arithmetic each year, creating a figure that either grabs headlines and shames outliers -- or gets buried in the corporate proxy and does little to change the overall trend of executive pay.
But the wealthiest and greediest will keep getting the biggest platforms and megaphones to explain why they totally deserve their astronomical pay and they’ll still be in a position to squeeze workers not just at the bottom but in the middle and even toward the top—because American inequality is so extreme that being in the top 10 percent can still leave you at the mercy of the top 0.1 percent.