Readers Write: CEO compensation and composition, popping personal bubbles, income inequality

Sunday morning coffee and the Star Tribune go hand in hand in our household. Upon opening to the Business section and its executive compensation report July 21, we were met with yet another example of income disparity between top CEOs and median Minnesota households. A shocking 510 times more than most of us could even imagine earning. That in itself is disheartening, but I saw more.

As owners of a small business, we make a decent living and are proud of our contribution to our community and the service we provide. We pay a lot in taxes and have to buy "individual health care," which I can tell you is ridiculous for what we get in return. But yet that is still not what I was thinking as I looked over all of the information gathered for that report.

When I turned to the center of the section and saw the double-page spread of the top 10 CEOs, what I clearly saw was 10 men, all white — no diversity, no women. I held up the paper to my husband and said, "What is the first thing you see?" His response was immediate and the same.

I've been speaking out for years, starting back in high school athletics — the girls' sports and facilities weren't the same as the boys'. When I worked in advertising and had to conform to the "good old boys club," and was treated differently and asked to do things the men wouldn't do, I was diminished for what I could actually bring to the companies I worked for. Sadly, I really thought that things would change during my lifetime, yet we are still seeing headlines about income inequality, and men are still predominantly at the helm.

As I continued to read through the list of all of the top 50 executives, I noticed very few women, and from what I could decipher from names, very little diversity. I'd be curious if the Star Tribune could clarify not just compensation but gender and diversity in these annual reports, so we can hold these companies accountable. I am still holding out hope to see a change in our business culture before I die, knowing that there are many, many women who could do great things for any of those companies.

I appreciate Michael Nesset's conclusion in "The world outside my bubble" (Opinion Exchange, July 21) that our country and state need a new civil-rights movement. An essential element is the need to deepen and broaden the understanding of our national origin — to face the reality that our country was built on racism with free slave labor essential to our economy, not only in the South.

In his autobiography "Born a Crime," Trevor Noah states that we in the U.S., as in his native South Africa, have not confronted the reality of racism. He would affirm Nesset's view that our superficial understanding of racism can lead us to assume that the problem was resolved with the Civil Rights Act of 1964. In order to combat this shallowness, Noah suggests that we look at the way Germany educates its children about the Holocaust and the Nazi era. German children, he says, are taught in depth "the how, the why, and the meaning" of this shameful period in their past, whereas children in the U.S. learn some facts about slavery and racism, but "never the emotional or moral dimensions."

Nesset's life journey and lifelong learning well qualify him to interpret the socioeconomic diversity of the many cultures that comprise our nation. The retired Lakewood Community College professor described his 24 years of interaction with his students (immigrants from Africa and Asia … and, various backgrounds, ages, and kinds of intelligence) as having been greatly enriching and "bubble-popping."

Nesset counsels that what we all have in common is greater, and more important than, our differences — for example, "different-colored" skin. A takeaway from the professor's interpretations is that culture, more than race, primarily determines mentality — and, accordingly, one's socioeconomic advancement.

Nesset cites Minnesota's "appalling social and economic disparities between blacks and whites" and suggests the remedial action of a new civil-rights movement — aka, federal and state legislation.

Serious discussion of the status of Minnesota's communities of Native Americans and blacks (i.e., those who are slave descendants) invites "racist" labeling. But the issue is cultural — not racial. It cannot be legislatively resolved.

The socioeconomic advancement of those communities is primarily dependent upon "bubble-popping" their leaders.

It would be clearer to use a uniform measurement of income inequality, widely recognized by economists — the Gini index. This number ranges from 0 (perfect equality) to 1 (perfect inequality: one person has all the income) and takes into account the income of all individuals, rather than cherry picking some particular groups. The U.S. Census Bureau charts the rise of the Gini index in the country from 1967, when it was 0.397, to 2014, when it reached 0.480 (tinyurl.com/cb-gini). I regularly have my calculus students find this value from census data.

To understand this in context, I think a comparison with other countries would be useful. The CIA does just this, publishing a Gini index for 157 countries of the world (tinyurl.com/cia-gini).

Among those countries, the U.S. is definitely on the more unequal end, listed as 39th most unequal, between China (29th) and Russia (57th, with a Gini index of 0.412). The next developed economy after the U.S. is Japan (78th, with an index of 0.379). Developed Western European countries are noticeably less inequitable with Gini indices between 0.249 (Sweden) and 0.359 (Spain).

It would be worthwhile to debate what is the optimal Gini index for a sustainable, robust economy. One can plausibly argue that Sweden may be too low, but Russia is widely reputed to be highly inequitable — and the U.S. is rated worse by its own CIA. Inequality in the U.S. is not as blatant as in Russia, but it negatively affects the great majority of our people.

The writer is a mathematics professor.