An ethics question to distract those who are tired of talking about themselves:

You are presented with a pair of identical twins, by the names of Albert and Linus. The twins truly are identical - identical looks, identical brains, identical education, identical personality, and identical morals. Only one thing makes them different - their choice of career.

Albert is a high roller, and works as an lower-tier executive for a large, well-known company. Albert makes enough in salary alone to be classified as wealthy, but also receives an yearly bonus that is equal to 100% of his annual salary. Now, Albert's company is suffering in the current economic climate - partially because it was run by idiots (not Albert - Albert was the lone voice of reason in the leadership of the company), and partially because of larger economic forces outside of it's control. The company has decided to eliminate the executive bonus this year, because of the current economic climate. This angers Albert deeply - so deeply, in fact, that he considers abandoning his job altogether.

Linus chose a different path from Albert. Linus never even made it to middle management - not because he wasn't intelligent enough, and not because he didn't work hard enough, but just because he's never really aspired to such a thing. Linus makes a decent salary, enough to live on, which is approximately 1/20th of Albert's salary. Linus' company recently closed it's doors, and laid off all of it's employees, Linus included. Linus has been looking for jobs ever since, and has received several offers, but all have been at a lesser salary than what he was making prior to being laid off. Linus turned down every job offer, because he doesn't feel that he should have to make the lifestlye changes that accepting a lesser salary would necessitate.

Which brother displays a more profound sense of entitlement, and why? Is one sense of entitlement "worse" than the other?

Did Brother #1 actually earn his bonus by ensuring sufficient added (real world) income to the company each year to cover the bonus before profit? Most who receive bonus compensation at the level you describe do not actually earn the bonus they receive and get it as members of the "old boy's club". It is difficult to imagine actually earning a bonus equal to your annual income, especially if you indicate that he received a large income already. I know that some bonus packages are tied to (for example sales) performance, and potential profit depends on sales generated. However you did not mention that.

Brother #2 can turn down as many jobs as he wants if the salary is insufficient to support him or at a level he feels is below what the job should pay in the market place. At some point, he will need to work and entitlement will not pay his bills.

I vote for brother #2 as being the more noble cause. Brother #1 seems more greed driven than his sibling, but that may only be because of the way you have stated their cases.

Many times, I wish I had just applied for a job with the government as a lower level monkey manager in an entitlement program. Less pay, no bonus, ultimate job security. You must love those people. They figured out how to succeed in this down economy.

"profound sense of entitlement" -- how do you measure that? They're both being nearsighted, but Linus is damaging himself more than Albert. Albert's self destructive revenge fantasy isn't real. While his apprehension of his situation is more or less equally fantastic, Linus' plummet is real. Albert will wake up with his job intact. Linus will wake up with his unemployment running out, his savings gone, and his prospective employers asking why he spent a year doing absolutely nothing.

A more realistic test would be if Albert actually quit, but then he'd be doing the same thing Linus is doing, fishing for tuna in the pasture pond.

I don't think it matters if Albert thinks he doesn't deserve to lose his bonus because he wasn't part of the problem; I guess I put that on par with Linus thinking he should be paid more because he was in the past.

Well, I left it vague for a purpose. I'm interested in figuring out where people come down in their opinion of who's more "right" in the two cases presented. In other words, is feeling entitled to a reward greater than/equal to/lesser than feeling entitled to (what you consider) basic needs?

For the purposes of this conversation, the hypothetical company promised a bonus to Albert. He is provide the same amount, every year, and it is not related to performance. Obviously a hypothetical situation, but I'm trying to keep it as intellectually "clean" as possible.

So Albert's basic needs are being met already, and Linus's are not? I don't think Linus wanting to make the equivalent of his past income is any more realistic than Albert's desire to make the same income he thought he'd earn. To me, the principle is: don't be a drag on the rest of us and expect us to take care of you because your pretty little salary went away. Get off your ass and get any kind of job you can till things get better.

So I guess I think Linus feels more entitled and is more wrong, because he's expecting the system to care for him through unemployment benefits, when he could be working.

Your pay is directly proportional to what you ask for or demand, nothing else.

Second lesson:

Never stop negotiating your pay.

I see no sense of entitlement in either man's situation at all. Both want to get paid as much as they can get for as long as possible. That is the bargain capital makes with labor. I will pay you X if you do Y. Your job if you decide to accept it is to get as much X as possible for as little Y as they will allow.

If you think this is warped, then you do not know a thing about high compensation. Anyone can make an hourly wage. It takes real guts to make serious money though and most of the dough goes to a very, very small group of people in each and every company on the planet.

Well, good points all, but we differ on what we call entitlement.

My opinion is that pay is largely shaped by what you feel you are entitled to. In other words, you feel you deserve "X" amount of compensation for "Y" amount/type of work + "Z" amount of experience + "ZZ" amount of knowledge + "ZZZ" expectation of life style + "ZZZZ" comparable wage in the market. They're all expectations - you don't compete every day for the pay that you take home; I don't even know what a system that did so would look like.

Your job if you decide to accept it is to get as much X as possible for as little Y as they will allow.

Aw contrary, mon ami. You have clearly demonstrated the purity of the socialist, trade union mentality. This, in a nutshell, is precisely what is wrong with the country today.

My style has always been different. An employee (regardles of level), while always cognizant and ready to negotiate for X. must apply himself so seriously to Y that he ends up being the one who cannot be replaced. He must do his job so efficiently, and so steadily, that the firm for which he works cannot help but prosper from his effort...and take notice.

This is the path to success in the workplace, not joining a Union that will force a company to pay more than a job is worth, and encourage the employee to do as little as possible. I have known many employees over the years who did just as little as they had to do to keep from getting fired. They were, to a man (or woman) miserable creatures.

I suspect that you do more Y than might be expected of you. If you did not, you would not be where you are now (that is....helping my stock to go up).

Jack

The third lesson is that you are duped into thinking you have no power over your pay. You do. You may not want to hassle it that much but you do. You can always walk, that is ultimately your best bargaining chip. The rest of it are negotiating points. Ever wonder why AIG folks have contracts that pay them despite the debacle? Tons of executive pay plans are like this, tons. In fact, other than hourly workers, most executives are NOT tied to profits at all. They are tied to shareholders first who could care less about the fundamentals of a company, only trading. This is one of the worst things about our system, its skewed towards looting not merit.

Well, I did not mean do nothing for a lot of money. The point was to control how much of Y you need to do to get X in return. The lower the bar, the higher the pay per unit of work. If you do not think this is how big business works, then you are being fooled by a story in your mind. Small business is probably a different matter because you cannot hide in a small business. But in the big world which is over a 100 employees or so, my rules apply in most cases. As for stock prices...cash is king JD.

I have never known a bonus that was not tied to performance and profits. The concept of an executive getting a bonus whether or not he has done his job efficiently, is foreign to me. No one should be guaranteed a bonus. A bonus is an incentive to do more than is required.

If a company, like AIG, is going into the toilet, how can they pay bonuses....there is no profit from which to pay the bonuses? If the company suddenly thinks it's doing great because it has received $125 Billion from the Federal Government, then it is deluded and needs the lender, or beneficiary, to step in and just say no.

It is un-American for executives to get huge bonuses, at the taxpayer's expense, when they have not managed the company profitably. Whether Obama has the balls to tell them to defecate or vacate the water closet or not, remains to be seen. President Reagan wiould not have allowed it....although I think Bush probably would have caved in to the corporate interests. He never really was on our side.

Jack

Hm..so Linus is wrong to expect what he considers a basic wage, and refusing to accept anything lesser than that?

This thought process troubles me. My socialist tendencies tend to push me to believe that Albert is the one who's most wrong. However, the Linus predicament troubles me, because he should still be attemting to carry his weight, otherwise he's a drag on everyone else.

I've been mulling this over ever since I watched the news this morning while drinking my morning coffee, and heard the excuse that AIG needs to pay their huge executive bonuses to "keep talent". Obviously that talent feels entitled to their bonus, even though they didn't really "earn" it. I see this entitlement as the same as the guy on unemployment who feels entitled to a $40k/yr job, even though all the jobs he's qualified for are only paying $30k. My sympathies lie with the poor guy, but my upbringing says that the guy who's expecting his bonus has every right to quit if he doesn't get it. My intellect says that they're roughly equal situations, and neither really deserves what they think they should get. Quite a conundrum.

Hence the hypothetical question posed above. I'm curious what other people think, and the rationale for it. I don't want to complicate the thought process with politics/current events though, because people bring their emotions into the situation, and it all goes downhill from there.

What about if the bonus payout isn't on the taxpayer's dime? Do executives who didn't earn the bonus still get it?

when you're out of a job, you get what you can until you find something better, then you jump back up to your fair salary, or you become a lawyer, get involved in politics and advocate for better wages. Or you start a company, like Ben and Jerry, and tie executive pay to workers' pay with a ratio.

Since guys like Albert start crawling up the financial food chain to reach those bonuses, they feel that their hard labor at the bottom entitles them to the bonuses, as much as whatever they're doing that year. I think if you know how the structure works in say, AIG, you'll understand better why someone like Albert would sue if they didn't get that bonus. It seems absurd, and should be, but there is a reason in their minds (ie they're not crazy, they're just thinking about this the wrong way).