On Wednesday, anyone who watched Rep. Nydia Velasquez’s performance at a House Financial Services Committee hearing got a revealing peek into the mind of a liberal. Velasquez (D-NY) was questioning Citigroup CEO Michael Corbat about his paycheck, insisting that it was not fair that he should make so much more money than the average employee of the bank.
“The Citigroup board awarded you more than $24 million in compensation for 2018. According to the bank’s 2019 proxy statement, the compensation for employees at Citi was $49,766,” she said. “As a result, Citigroup has the dubious distinction of having the largest discrepancy between CEO compensation and median employee salary of any of the institutions present here today – a remarkable 486 to 1 ratio. Does this ratio seem fair to you?”
Before we get into Corbat’s response, let’s just stop and parse this philosophy. What Velasquez is saying, essentially, is that there is something wrong with a company’s CEO making so much more than the rest of the lower-level employees. We doubt that she would be able to quickly answer what ratio would be fair, but all right, fine. That’s beside the point.
The real point is Corbat’s journey to the top. We don’t know everything about the specifics of his story, but we can assume that he was not born the CEO of Citigroup, right? He may have been born with some money. He may have had the grades, connections, and money to go to Harvard. That’s fine, no one’s denying the fact that some people have a leg up in life. There’s no changing that fact, so why whine about it?
It doesn’t change the truth, which is that Corbat labored at Citigroup for 29 years before finding himself at the top of the company. Something tells us that he wasn’t making 486 times what everyone else was making during that journey. So what happened?
Well, put simply, he made himself more valuable. He climbed the ladder. He took advantage of the unique opportunity that is the American dream.
The American dream starts with a personal dream. Corbat didn’t become CEO of Citigroup out of luck or because his life-ship somehow drifted into one of the most profitable positions in the country. He got there because it was his goal to get there. He could have used that same energy, we can surmise, to accomplish anything else he set his mind to. Or he could have wasted it complaining about how much his boss was making while he was toiling in the trenches.
“Let me ask you this question,” Velasquez continued. “If you were an employee, and you saw your boss making $486 dollars for every dollar you make, how would you feel about that situation?”
“I would be hopeful that there’s opportunity to continue to advance within the firm,” he replied.
“Well, just unbelievable,” she said, “and this is why people who live in a bubble or ivory towers cannot understand why there is so much anger out there, especially among students and millennials who graduate with student debt in one hand and a diploma in the other.”
What she fails to point out is that Corbat WAS “an employee.” And instead of feeling aggrieved about the unfairness of the situation and whining about his plight in life, he climbed the ladder. That’s what the American dream is – a ladder. And if you are inclined, you can just keep climbing it until you are in that “ivory tower” that Velasquez is complaining about.
Or, you can waste your life wishing that things were different.