Thrill to ten figures over ten years: $1,835,000,000. How could any CEO ever be worth that much?
Larry Ellison, founder and chief executive of Oracle , raked in that sum from 1999 to 2009, making him the highest-paid CEO and the next poster boy for the pay prudes.
These self-appointed compensation critics can’t fathom why a suit who created the company and oversees thousands of employees should make so much more than the company janitor.
This politically correct peanut gallery has it entirely wrong: Larry Ellison was worth every dime Oracle shareholders paid him.
And if he wasn’t, that matter is best left to Oracle’s owners to address.
Not Obama and the feds, not the Corporate Library or the AFL-CIO and AFSCME.
From the moment the salary figures showed up in on Tuesday morning, anti-capitalist carpers began complaining.
One on-air guest on CNBC yesterday, a union guy I think it was, lamented lavish compensation at a time when millions of Americans are unemployed.
It’s a pious false analogy: Sorry for their pain, but one thing has nothing to do with the other.
For $1.84 billion paid to Larry Ellison, Oracle added $80 billion in market cap, quadrupled earnings to $6 billion a year, and tripled annual revenue to more than $26 billion. As Oracle share price tripled from 1999 to 2009, the S&P 500 index lost 24% over the same period. (Follow Oracle Here)
Not a bad payoff. Wouldn’t you pay a guy $184 if he promised to turn it into an extra $8,000 in the next ten years?
At Apple, Steve Jobs looks like an even better bargain: He hauled in 35% less than Ellison did (at almost $750 million, most of it in restricted stock), but Apple stock rose more than 11-fold, three times as much as Oracle's.
Let the comp-police target, say, , who took in $450 million while investors lost close to 70% of their stock value. Never mind that some 95% of his pay came from 1990s stock options that paid off earlier in the decade. And Dell himself, bless him, hasn’t received a bonus in four years and hasn’t received stock or new options in six years .
So get off Michael Dell’s back, okay?
And spare us the potshots that inevitably will be aimed at Oracle’s Ellison, Apple’s Jobs, IAC’s Barry Diller and host of other heroes of capitalism. It’s one thing to decry any plush pay for the likes of meltdown mavens Angelo Mozilo of Countrywideand Richard Fuld of now-defunct Lehman Brothers. They wrecked the economy and laid waste to their shareholders.
But the tech guys didn’t present a systemic risk, they didn’t contribute to the meltdown. They just made products that propelled business, excited consumers and often fueled higher stock prices. What are the chances the Pay Police see any distinction here? For them, all high pay is suspect—except their own.
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