Michael Eisner vs. Vietnamese Laborers
excerpted from the book
Corporate Predators
by Russel Mokhiber and Robert Weissman
Common Courage Press, 1999
If greed is good, as Michael Douglas infamously stated in the movie Wall
Street, then Disney CEO Michael Eisner must be a saint.
Last year, the Disney executive received compensation of more than $575
million. On top of his $750,000 salary, Eisner claimed a $9.9 million bonus and
cashed in on $565 million in stock options.
This is not the first mega-pay haul for Eisner. From 1991 to 1995, he took
in $235 million. A decade ago, in 1988, he collected more than $40 million-a
compensation package which led to shrieks of outrage.
In Eisner's defense, it can be said that giant salary grabs are increasingly
the norm among big company CEOs. Among the heads of the largest U.S.
corporations, CEO average compensation is $5.8 million. CEO pay rose 54 percent
from 1995 to 1996 (final 1997 figures are not yet in) and have risen almost 500
percent since 1980.
Skyrocketing CEO pay does not represent a massive expansion of the economic
pie from which all corporate stake-holders are benefiting. While executive pay
increases partly reflect rising returns to shareholders, workers have received
almost none of the benefits showered on those at the top.
Average hourly earnings for working people have actually dropped since 1980,
from $12.70 (in 1996 dollars) in 1980 to $11.81 in 1996. The ratio of big
company CEO pay to factory workers' wages has ballooned from 44 to-1 in 1965 to
more than 200-to-1 today.
There is no sharing of the economic pie here.
Rising executive compensation and flat or declining wages for workers both
reflect a single reality: the diminished power of organized labor.
If enough CEOs start taking home Eisner-like wages, then public outrage may
work to curb executive compensation. But it is hard to imagine a concerted
effort to rectify the imbalance in executive and worker pay in the absence of a
resurgent labor movement. There are no signs of self-restraint or enlightened
generosity among the employer class.
As severe as the wage disparity is between U.S. executives and U.S. workers,
however, the differential between the executives and Third World workers at
whose expense they increasingly profit is staggering.
Disney, to its everlasting shame, has in recent years out-sourced production
of Disney clothing and toys to sweatshops in Haiti, Burma, Vietnam, China and
elsewhere.
Last year, the Asia Monitor Resource Center, a labor monitoring organization
based in Hong Kong, reported on the operations of Keyhinge Toys, a factory based
in Da Nang City, Vietnam that makes giveaway toys based on characters in Disney
films which are distributed with McDonald's Happy Meals. According to the Asia
Monitor Resource Center, the approximately 1,000 workers in the Keyhinge factory
in Vietnam earn six to eight cents an hour, far below the subsistence wage
estimated at 32 cents an hour. The workers-90 percent of them young women
17-to-20-years-old-are required to work mandatory overtime, with 9-to-10 hour
shifts required seven days a week. In February 1997, a combination of exposure
to toxic solvents, poor ventilation and exhaustion caused 200 workers to fall
ill, and 25 to collapse.
On an annual basis, the workers at Keyhinge are making approximately $250 a
year.
Less than one-fifth of Michael Eisner's pay-$100 million-would be enough to
quintuple the wages of each of the 1,000 Keyhinge workers-giving them a still
inadequate, but at least living wage-and to pay them for 100 years! That would
leave Eisner with $465 million for 1997 alone.
To call this kind of disparity "Dickensian" is to understate the nature of
the problem dramatically. Globalization has wrought unprecedented and
unconscionable gaps in income and wealth.
The system is out of whack, and it is going to take more than a little
tinkering to set it right.
Corporate Predators