Executive Pay: 10% of corp. income

In today's Wall Street Journal was this nugget:

In the period from 2001 to 2003, top-executive compensation amounted to 9.8% of the companies' net income, almost double the 5% in 1993 to 1995.

And, to quote a draft of the paper:

compensation levels in 2003 were much higher than they would have been had the relation of compensation to firm size, performance and industry remained the same as in 1993

In other words, the increase is unrelated to CEO performance; what we're seeing is simply a shift of compensation from shareholders and employees to executives. In addition, as the WSJ article quotes an economist saying, this affects the quality of products that we, as consumers, can purchase:

the greater the gap between the pay of top executives and the lower-ranking workers in the company, the worse the product quality was