Clarifying executive power
Peter Frase is right (“Are CEOs workers, and should we care?”) that talking only about ratios of CEO to worker pay ignores positions in the M-C-M’ circuit. The pay of CEOs and other top executives is almost entirely a return on capital. Perhaps there’s some reward to skilled labor there, but nothing approaching $11 million. Unlike workers, who live under harsh labor discipline, your average CEO is lightly supervised by a board. It’s a rare day when a bad CEO gets fired. The CEO class enjoys an esprit de corps; they sit on each other’s boards where they endorse large pay packages. Workers are barely allowed unions. And CEOs have enormous social power. They help run the government and the prestigious cultural institutions. They’re major players in the ruling class. I regret not having mentioned all this the first time around.
LBO News from Doug Henwood 
Yeah, I like Doug explaining the M-C-M(1) circuit !
Well said!
Yes, I agree. However, I can’t help but think it absurd that this is really an issue that needs fleshing out in the first place (maybe it serves as a good example of what Ben Noys has called the “cunning of capitalist reason”). As soon as someone utters the nonsense that a CEO is a “very well-compensated wage slave,” it’s time to move on to something more pressing. The amount of necessary labor time spent by the majority on social reproduction continues to grow, while the amount of time available to spend on discussing this process continues to shrink. So, does it make sense to say that the increasingly astronomical “wages” of the “Chief Executive Prole” are, of course, a key feature of this process? Where else might this share of income have been directed? Hasn’t the capitalist class been “on strike” by default for over three decades? We’re forgetting what we (excepting people like Matt Yglesias) already understand all too well.
I agree that CEO compensation is absurdly high, but I don’t think it is properly viewed as a return on capital. CEOs (and other senior management) rarely provide significant capital to their employer, instead they use their control positions to skim off a significant part of the profits earned on the capital provided by shareholders. A further point is that when CEOs do get stock of their employers from stock options, etc., they often sell large portions of that stock on the ground that they need to diversify their holdings.