Is Enough Ever Enough? (Gwen Moritz Editor’s Note)

“Beyond being sorry I feel great disappointment, frustration, despair, indignation and resentment,” said Hiroto Saikawa, CEO of Nissan. It was part of a seven-minute apology he delivered in response to the news that the chairman of Nissan’s board of directors, Carlos Ghosn, had been arrested in Japan for self-enriching financial crimes.

Ghosn, who is also CEO of French partner company Renault, was paid $89 million over five fiscal years that ended in March 2015, according to The Associated Press. And his 2016 pay package was so generous that shareholders voted against it and the French government pressured the board to reduce it. In 2017, he was paid the equivalent of $6.5 million by Nissan and $8.5 million by Renault.

And yet it wasn’t enough, if the charges against him are proven correct. He allegedly underreported his income in Japan, which has a progressive income tax similar to ours, and he allegedly used corporate funds for personal gain.

Reports I saw last week didn’t specify exactly how much Ghosn supposedly benefited from the crimes, but it seems likely to be far more than the closest comparable case I can remember in Arkansas: the $500,000 or so in gift cards and improper reimbursements that the late Tom Coughlin helped himself to when he was vice chairman of Walmart Inc. in the mid-2000s.

For those of us who have never been rich or even seriously entertained the prospect, the idea that millions of dollars, even after taxes, year after year would not be adequate is mind-boggling.

OPM — Other People’s Money — is the primary reason people read Arkansas Business, and that’s why I dedicated many hours to last week’s list of the state’s highest-paid public company executives.

Years of researching that list have left me fairly numb. Yeah, Doug McMillon made another $22.8 million last year as CEO of Walmart after making $22.4 million the year before. I have no idea how much he clears after taxes or what he does with his money, and I don’t care.

People who have to perform at a high level and to do so with the transparency required of public companies deserve to be well compensated. I don’t begrudge them anything their investors and directors are willing to pay, even if I don’t understand the financial priorities.

Far more interesting to me is the new thing that public companies had to report this year: the ratio of CEO compensation to median employee compensation. The ratio itself — a punitive part of the Dodd-Frank reforms following the 2008 financial meltdown — is nearly useless. Yeah, it’s breathtaking that McMillon’s pay is almost 1,200 times the $19,200 median pay for other Walmart associates, even without including salaries from particularly low-wage parts of Walmart’s global footprint. But what could be harder than being responsible for a far-flung organization with 2 million employees, many of them low-skilled?

The median pay figures themselves are far more useful. Consider: Half of the employees of ArcBest Corp., which has a contract with the Teamsters union, earned more than $95,500 in 2017, while half of all employees of Murphy USA earned less than $17,000. The median employee at Murphy USA was described as a part-time store employee, but someone working 40 hours a week for 52 weeks for Arkansas’ current minimum wage of $8.50 would earn less than $1,000 more than that.

Those are numbers that anyone can understand and that can be helpful for executives competing for the same workforce. They might even help explain why Arkansans keep defying the dire warnings from the business community by voting to raise the minimum wage.

Meanwhile, on the other end of the OPM spectrum, Rep. Stephen Meeks, R-Greenbrier, has apologized for a tweet in which he said that “[b]eing poor in America is a personal choice, unless there are mitigating circumstances” and declared that “a homeless man can go to school, get a job driving a truck making $70k per year and in 20 years become a millionaire.”

Meeks deleted what he called a “poorly worded tweet expressing my belief in the American dream.” Believe me: The more words you write for public consumption, the more of them will turn out to be poorly chosen. And I still harbor my own belief in the American dream, although it is now easier to escape poverty in China than in the U.S. (The New York Times website has a great interactive feature on this phenomenon.)

But when you start talking about becoming a millionaire in 20 years on $70,000 annual income, the math falls apart. Especially with the stock market performing like it has this year.

Email Gwen Moritz, editor of Arkansas Business, at GMoritz@ABPG.com and follow her on Twitter at @gwenmoritz.