How do I handle an abusive supervisor

I have a supervisor that is failing at their job and has gone on record saying that I have a better job and wishes that he had mine. I am performing a very high level and have consistently been one of the highest performing employees in the company. I have received regular promotions and bonuses.

The problem I have is with my new supervisor. This person is not performing, constantly verbally attacks employees and co-workers. Gossips about everyone and has hurt our position with suppliers. This person is an officer of the company, but is driving business away and running off good employees. I too am an officer, what can I do about this. My Boss has told me that he wants my job, because it is better in his opinion. I think this is because he thinks it is easier and would have a better chance of making his numbers. He is in trouble with his supervisor and every time he gets yelled at, it just gets transferred to me and the rest of the staff. A number of employees are discussing quitting, but I love my job and the company, just not my supervisor. What can I do. He just installed spyware to monitor all of the employee's emails.