Too Much?

High-salaried executives get a lot of complaints about the size of their paychecks. Recently, 29 corporation presidents got the same letter from a complainant named Guy K. Benson, of Manhattan. Benson wrote that he was a small stockholder in their companies and that he thought their salaries too high; they should be cut. The presidents had no way of knowing that Forbes Magazine had put Mr. Benson, a free-lance writer, up to his letter-sending. It wanted to make a sly test of corporate public relations.

Last week Forbes published the results. The two Charles E. Wilsons (no kin) who boss General Motors Corp. and General Electric Co. flunked the test, along with six other corporation presidents.* They did not answer Benson. But the rest all passed handsomely. Benson even got two to agree with him. Curtiss-Wright Corp.'s Guy W. Vaughan and Sinclair Oil Corp.'s Harry F. Sinclair reported that they had already cut their salaries. Republic Steel Corp.'s Charles M. White, who makes $200,000 a year, made no such concession. Said he: "I have no intention of suggesting that my salary be reduced, and, on the contrary, if it were it would be my present thought to resign immediately."

The biggest tycoon of the lot, E. I. du Pont de Nemours & Co.'s Walter S. Carpenter Jr., took time to write the longest letter, four single-spaced pages packed with some hard sense about salaries. What it came down to, Carpenter told Complainant Benson, was this: How much did the company profit on the high-priced executives--and how much were they worth in the going market? As for Du Pont executives, he wrote: "I believe competitors . . . would be willing to pay . . . as much. . . . I believe the company's interest is better served by paying that compensation than in losing their services."

Taxes were so high, said Carpenter, that a raise in salary from $50,000 to $100,000 a year gives a man an actual increase of only $12,000, and leaves him a spendable total of $38,000. If the salaries of Du Pont's nine executive committeemen (the top management) were completely eliminated, said he, it would add only 9.3-c- per share to the company's earnings (some $113,000,000 in 1947). Carpenter then checked his present salary ($175,000) against what he earned 25 years ago ($78,570). He found that present taxes leave him $48,251, where in 1922 he had $60,843 left after taxes.

* Gillette Safety Razor Co.'s J. P. Spang Jr., Cities Service Co.'s W. Alton Jones, Decca Records Inc.'s Jack Kapp, Childs Co.'s Edward C. Field, American Chicle Co.'s Thomas H. Blodgett, Artloom Corp.'s A. S. Mitchell.

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