Wednesday, March 28, 2007

Intel CEO "worth" 123.6 teachers

Here's today's Red Electric episode on "This American Life."

Today's Oregonian brings news that Intel's CEO Paul Otellini was "penalized" monetarily last year for the company's poor financial performance and for not meeting goals. In 2006, net income for Intel was down 42 percent over 2005.

Being "penalized" meant that in 2206 Otellini eked by on a mere $6.18 million in compensation. The AP story demonstrates the utter cruelty of Intel's decision by comparing Otellini's pittance to the $16.1 million raked in by CEO Hector Ruiz of Advanced Micro Devices.

The connection? AMD is Intel's chief rival.


Now for the real comparison beyond the corporate bubble of competitive CEO "worth."

If you take Otellini's pauper's salary and divide it by $50,000, the wage a school district might pay a moderately experienced school teacher, you discover that Otellini, by American society's twisted market standard, is "worth" 123.6 teachers. Count slowly to 123 to get a full sense of the number. "One teacher...two teacher...etc."

Consider that 123 teachers are probably enough to staff five or six neighborhood elementary schools in Portland. You know, just like the ones the Portland School District has been closing.

Do the numbers on Ruiz's grotesque AMD compensation and you could probably throw in teachers for a couple of middle schools and a high school, as well as custodians to clean up after the kids.

Meanwhile, back at Intel and AMD, as they crunch the performance numbers and compare salaries, do Otellini, Ruiz and their compensation committee members ever weigh the debt—educational or financial—they owe teachers who helped them in their own lives?

One more note: Deep in The Oregonian story we get one more insight into Intel: Last September Intel's executives, while wringing their hands over up-coming compensation "penalties," announced they were eliminating 10,500 jobs world-wide.

I've raised this before, but it bears repeating: Let's hope that one day (soon!) folks will look back at this time as a shameful aberration—that they will have ensured that such greed and inequity will never happen again.

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Blogger Jmartens said...

interesting way to look at things, thanks for the post.

3:21 PM  
Anonymous Anonymous said...

it's AMD, moran.

12:53 PM  
Blogger Rick Seifert said...

Thanks for the correction of my dyslexic abbreviation ADM. I've fixed it in the post.

You might want to check out the spelling of "moran." Sad to say, I think you meant "moron."

What goes around, comes around.

2:48 PM  
Anonymous Anonymous said...

Yeah, it was tongue-in-cheek. I was just poking fun.

On a more serions note, comparing the average teacher with Otellini is like comparing an apple to a bag of apple seeds. (Yeah, I said apple seeds)

Otellini is head of a corporation that has approximately 95,000 employees and worldwide influence. Intel's products form the backbone of virtually every industry that has anything to do with technology - industries that you and I depend on daily for information, communication, entertainment, transportation, financial transactions, etc.

The average teacher has far less influence, far less experience, and far less responsibility than Intel's CEO. An average teacher will maybe have 360 students a year? (6 periods x 2 semesters x 30 students)

If you want to make a comparison and talk about people being overpaid, why compare your teachers with UO President David Frohnmayer? Frohnmayer's total compensation is $500,233!! Is he worth 10 of your teachers? I'll let you make up your own mind on that, but I would still argue that Otellini is worth more than 12.3 Frohnmayers...

Thanks for the food for thought, though.

4:54 PM  

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