Laura Crawshaw's Answer:
Your CEO exhibits the top five behaviors that characterize abrasive (aka "bully") bosses, namely; over-control, threats, public humiliation, condescension and overreaction.
As I have discovered through my many years of coaching these individuals, their overly-aggressive behaviors stem from profound insecurities regarding their own competence. They may look confident and self-assured, but don't be fooled. What you see are your CEO's frantic efforts to defend against this unconscious anxiety by continually "proving" that everyone else is wrong, inadequate, and incompetent and that he, in contrast, "knows everything, first and better."
There are two basic of strategies that I have seen some fed-up (and courageous) employees use successfully to tame their abrasive boss: issuing a request or a threat.
The first option, requesting that one's boss refrain from abrasive behavior, should be done calmly and respectfully, incorporating a strong dose of reassurance of your commitment to competence:
"Could I ask something of you? I am totally committed to meeting your expectations, but when you have concerns about how I'm proceeding, I would like to ask that you not refer to me as 'stupid' or 'idiotic' – instead, could you just tell me your specific concerns so I can better address them?"
Surprisingly, this style of polite request often yields results, as it can shock abrasive bosses into awareness of the negative impact of their behaviors on others.
These individuals are notoriously blind to the pain they inflict, often having been treated similarly in earlier life and concluding that such aggression is normal. As one VP I came across declared: "My father kicked my ass to get me moving and look where it got me today!"
The second strategy, that of issuing a threat to one's boss, consists of the same polite request to refrain from specified abrasive behaviors, followed by a calmly-stated threat to seek recourse if things don't improve.
"I told her that if she kept shouting at me, I'd be forced to take it further up the chain." As one employee noted: "The boss treats everyone badly, except for Jean. He doesn't pull that with her. He did at first but then one day she said she wasn't going to put up with that kind of treatment, and he never did it again."
Certainly both of these courses of action are fraught with risk and should be considered carefully before proceeding, but unfortunately, I don't think either will help you.
Your boss has demonstrated that he is on the extreme end of the abrasive continuum, executing threats to exile anyone who displeases him in any way. Secondly, there is no recourse at higher levels – he sits atop the pile of pain he has created.
I suppose that you could psychologically prostrate yourself and beg for mercy, but then you might be viewed as weak and subjected to additional torment. Or you could resign yourself to continual abuse, trying somehow to grow a thicker skin that wouldn't show all the bruises.
My mission is to reduce suffering in the workplace, and in all honesty, I don't believe you have any options to deal with your CEO and make it work, and end your suffering.
I honestly believe your only option to stop the inevitable and progressive mental and physical deterioration you describe is to seek out a healthier work environment. Even though you state that this is not an option, think carefully about the value of your life on this earth.
If you devote this next year to plotting a successful escape, could there be hope of extricating yourself before you are rendered non-functional and/or your CEO schedules your execution?