mission of the university. but in 2010 i started another edition. >> the press is 110 years old. [inaudible conversations] >> my name is rick parker there and the publisher of "harper's" magazine and the

process owner that i call a white hot center of resistance to the market domination as an attempt to put all other players out of business and you sometimes mean on unpleasantries from parent companies to those deals that i think generally detrimental to the authors and independent book sellers but the culture at large amazon is a culture killer not a purveyor. i urge all of you to buy his book at the end of this talk he will sign books out there when he is finished because it is a great book.

but partly because you should pay full price for books. [laughter] you should never pay a discount if you can possibly avoid it because it is really damaging for those to do the hard work trying to produce literature and in journalism in this country. "harper's" magazine is independent and that book culture is very much engaged with that independent media and fought in the conglomerate consolidation of publishing is really beginning to close-up outlets like this one that came to us for a democratic debate and conversation. and this has become a

neighborhood center for this type of conversation. if you buy books full price we can keep doing that. so i welcome all of you. so tonight i can introduce this event as a bookstore owner but i also can interview stephen clifford with multiple hats as a journalist and ceo. not on his level but and i a man interested citizen getting the conversation started but when i unfinished interviewing him c-span is recording so when you ask your questions we only have 50 minutes, please wait to be handed a

microphone before you ask the question. so the millions who will be watching this can hear your question and his answer. >> did not want to read an excerpt?. >> no. i want to keep the audience awake. >> this is a remarkable book. because not only is it the annunciation of the scandalous i co pay but the expectation of american capitalism is the first association i have from the

folklore of capitalism that people used to read back in the day as a new deal lawyer and i wish he would start off talking about that because coming from a capitalist background you are a businessman. >> i believe capitalism is the best economic system we could have as long as there are responsible people running companies and certain forms of capitalism were working and i think one of the hugest problems is the insane co pay later recanted into how it became that way but it harms the companies that use it and the employees it is terrible

for the economy in one of the principal drivers of increasing economic inequality. so it isn't just the athlete gets paid a lot in the movie star gets paid a lot this is causing major harm. >> tell us how it started because i am too focused on the funny parts. there are funny parts. [laughter] >> it used to be the ceo was paid once a year with an interview he got a 4% just like the rest of the company and tell the mid-70s co pay

did not increase any faster than the average worker. menu had the pay consultants that started in the '80s and they caved in and started to learn what their other clients were paying the ceo. they thought this is a great sales tool so they said you should do this co pay based on others and we have that data. said you should hire us there was no theoretical justification and there was no evidence but the company started to do that the whole

basis then shifted from the idea of the internal equity to the idea of the external equity and so this quickly became a tool to ratchet up the co pay. so it is a little complicated but the company creates a group of the other companies that our comparable to this company they look at what there ceos are paid then that is the score for this company. i know you will be shocked to learn that companies choose the piers that have highly paid ceos. it is stunning but every one

of theirs is a highly paid ceo. so that this step number one. so if i.m. ceo and a have maya peer group the average ceo makes $10 million july make 10 million? know. because the second step is i have to be a benchmark to. the company is the average we're superior. to say we are better than 75% we should pay that so every company i saddam the board that i have researched had the peer group the 50th or 75th or 90th

percentile so that's rather a benchmark and that translates it 15 million though i am not paid 50 millions because americans believe it pay for performance that is the bedrock of co pay so i get to negotiate my bonus targets with the committee that is three year for people that set the compensation. i am the cl i have all of the information i know what is doable and what is not. the live people have no clue so i get to negotiate a targets and ranges if i hit my targets and will make more but pay for performance

is the more the ceo does the more he should get paid so i negotiate the easy target and surpass that by a to a then the said a 15 i get 30 million. now here is the key. that 30 million the cpac in to peer group pool of all my peers so they get raises. so the next year might peer group is higher paid so it is a mathematical certainty it is a one-way ratchet that is why co pay 1980 has increased tenfold. 1,000 percent at the same time the average working

american at the same time the average american worker got about a 4 percent raise in the bottom 90% lost ground if you want to know now trump will not do anything but that is where they came from. >> but there is also something they you did to as the cultural shift. there is a different mentality maybe beyond greed and self. michael jensen is one of the blue routes there is always one weirdo and you contrast

so i want you to explain with mitt romney's father george romney who is chairman of american motors the fourth largest car company when there was for and said romney senior turn down the $100,000 bonus after he told the board that no executive needed to make more than $225,000 a year. it is estimated he turned down 260,000 over five years at the basic level of the company but the idea was to

have allotted stake with shareholders and had to take care of them. all these people who had a stake in the company and if they had the gene needed to be cognizant to deal with them. but jensen had the philosophy that was a feel-good nonsense the only thing that mattered was your share price. with those sophisticated analytics. but they said that sounds

right so over 20 years is a complete shift for the business roundtable but in the '70s talk about the stakeholders talking shareholder value is the euphemism for that stock price so that is the idea of shareholder value and there was a cultural shift. the loss of shame and celebration of greed mitt -- george romney son never turn down the raise.

that is a cultural change so they get tens of millions or should you?. >> that is interesting legislation and not just for those usual suspects but under bill clinton with those measures the you describe as well-intentioned i am not sure i agree. [laughter] but those specific aspects are fascinating. there is so much good stuff you have to read the whole thing. the talk about the stock options and what happened

with the argument of the tax reform bill. >> win bush went to japan japan, as election coverage coverage, he will with a lot of american ceos and instead of trying to make more trade is a difference between the japanese ceos. american ceos at that time were 175 so that they would make this a campaign and he

said we will clamp down on the excess co pay anything over a million dollars is not tax deductible. so clinton in got elected and bin business groups started to lobby him and said if the pay is connected with performance then this is america. id tax incentives and performance? so through lobbying and other mechanisms could get clinton with his position to say anything over 1 million that is not related to performance and by the way

since the stock options are obviously related to the performance of the country you can give as many of those as you want. it is ironic so with this change opened the floodgates and reconciliation budget deals are the new taxes. those were fought tooth and nail by the republicans. this past without a single republican vote. now once that has passed in order to be performance you have to have a committee to have red balloons. [laughter]

but once he met the test then it was automatically not unchallengeable. so in the book i have a graph of co p to it -- co pay to the average worker pay. >> does he ever express regrets in the administration?. >> he did not express regret over monica. [laughter] cpac that was an attempt at a low humor on my part. >> now let's get to the specifics there is the chapter titled very clear called collective division

maliki. but -- divisions. so he has for case studies over the insane compensated they were a remarkable business and. >> even-steven helmsley and then to brothers again they have never heard of these people and david from the discovery communications who is your favorite? those numbers are astronomical. 142 million, helmsley got 102 million in just one year

>> is not like a wet through a lot of research. i just chose the executive but as you say nobody has heard of them. it is quite serious the have heard of him. [laughter] it wasn't like this was dave ruth. so as i go through this a couple of them missed their own targets badly and the

companies had to adjust and they could digest and with those that were far beyond his control was an avalanche on mount everest. [laughter] of all places? this may have interfered with the film schedules so it is not his fault. [laughter] but i have yet to see a case where a company reduced

earnings recover as they created sunshine. [laughter] >> he did some interesting things you have to of mitt. he added some programs like dirty jobs, ed deadliest catch, my cat from hell and river monsters. i skipped a little bit because i want you to talk about one of the funnier parts is job creation. one of the big justification for those amounts of money is there allegedly innovators and great job creators. obviously creative geniuses also. [laughter] >> they are accounting geniuses at least with their manipulation but i will make the distinction between ceos of the gore great and

those who tend to be the founding ceo mike seattle or bill gates howard schultz or mark zuckerberg they make their money on the stockholders but so do their shareholders. so i'm like who i am talking about a the shareholders are getting a great deal but

that concept that ceos like myself, the average fortune 500 works for pooley 56 years said his job so how many jobs will you really create? also that fortune 500 as a whole that job creation happened that the small start at the fortune 500 companies so the idea that somehow their job creators i take that back. the art auctioneers.

>> you are very modest to dave you were better at it. >> to be in the right place at the right time avoid the wrong place. then be lucky but i do want to get back some talk about the damage to you think the have heard lots of arguments about what is damaging the economy and a disproportionate amount of

money going to the top. as the excessive ceo pay starting the economy. >> but on that side and those of tens of millions of dollars. but other than that the effects of employee morale broke making five the times we make is very hard. but then -- but when you

have that ability of a $30 million bonus you want to achieve certain goals. you'll focus on anything else.

on the number of yachts used. . . [laughter]