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[Susan notes: The Wall Street Journal prints a letter stating 'There is simply no way to measure the value of one CEO over another.' What are the chances they'd ever say that about teacher value?]

Published in Wall Street Journal
01/19/2013

To the editor

The argument in In Defense of the CEO by Ray Fisman and Tim Sullivan (Review, Jan. 12) makes sense in that if CEOs are responsible for bringing in billions of dollars, they are more than entitled to their multimillion-dollar salaries. This is the same argument that justifies the salaries paid to professional athletes--they get what they bring in. However, unlike athletes and even other employees within a corporation, it is almost impossible to determine the "value" of a CEO.

There is simply no way to measure the value of one CEO over another unless you are looking at the profits of the entire company--where hundreds of (and realistically, most of) the factors are outside the CEO's control. The entire value of a CEO is in the "intangibles."

CEOs are like vitamins--you don't really know if they help or not. When things are good they get all the credit, and when things are bad they get blamed. Maybe CEOs do, in fact, play a crucial role in the bottom line. But since we aren't sure, do we really want to give them a couple hundred million "just in case"?

Farrell Murphy


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