Corporate Executive Pay and Tax Structure

 

CEO pay is out of hand. C-suite executive (CFO, COO, CMO, CLO, CIO, etc.) pay is also quite excessive, with Fortune 500 officers often making between 3,000,000 and 7,000,000+ in total compensation. These pay packages often include huge sign-on bonuses. The rise in executive pay correlates with changes to income tax policies enacted during the Reagan administration, so poor policy choices way back then are still affecting us today.

Not to focus on the domestic auto industry, but top executives' pay across industries in Japan, South Korea and Germany is much less than ours. This may be due in part to different corporate governance structures and corporate cultures, but these countries also have more progressive income tax policies. 

If it were possible to rein in these costs through taxes, the savings could go toward lower costs for goods and services, other areas such as R+D and quality control, or they could go to better pay for workers. It depends on the industry, but in several areas it would make sense to pay workers more because they receive low pay and don't consume much relative to wealthier people. This is especially true when it comes to low paid service and retail workers who are struggling with inflation and an inefficient housing market. 

Looking at the top 150 domestic market caps, there are companies such as Amazon, Walmart, Costco, Home Depot, Walt Disney, McDonald's, Starbucks, Lowe's, and CVS, which all employ a very large number of relatively low paid workers who receive few or no benefits (or who can't afford the benefits). There are also gig industry workers under a couple of brands. In other industries, such as insurance, it might be better to put savings toward lower rates for policyholders. A number of the top 150 are banks. Here, savings could go toward better pay for tellers.

Revolving Door Politics, Think Tanks and the Media

 

People should take a closer look at think tanks, the media and how government employees are using their positions to profit from private sector career moves. Proponents for loose regulation over revolving door policies argue experience outweighs the costs of leaving widespread loopholes. There should be strong regulations here, and none of this activity should be permitted when there are conflicts of interest. People know how to game the system, and this is causing all sorts of problems, especially when it comes to the national debt.

Sources: U.S. Office of Management and Budget and Federal Reserve Bank of St. Louis, Federal Debt: Total Public Debt as Percent of Gross Domestic Product [GFDEGDQ188S], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/GFDEGDQ188S, August 24, 2026.

Right now there are some regulations such as cooling-off periods. Current regulations are thin, and policy goes back and forth between shorter and longer cooling-off periods. This doesn't work here. Some of the regulations prohibit taking a position where there is a really direct conflict of interest. Often times former government officials get board seats at large companies or think tanks. Anyone can sit on a board.

This one guy went from a top government position, then years later received a board seat at a top contractor. Then, he gets a position with another contractor. He leaves the first contractor with millions in stock. While he sits as a board chair at a think tank, he has worked for Fox News as a regularly appearing strategic analyst for decades. 

This happens all the time across different industries. Some may argue for transparency, but this type of behavior really should not occur. Voters don't have time to conduct this type of in-depth research on all kinds of issues. That's what politicians are for. They're supposed to do the research and act in our best interests.