The Institute for Policy Studies just released it’s 17th annual study of CEO compensation revealing that the CEOs of the 50 corporations that cut the most jobs over the last two years received average bonuses higher than those paid to CEOs of the largest 500 businesses in America. You follow that? The CEOs who cut jobs got the largest rewards.
What’s worse, the Institute for Policy Studies found that 36 of those 50 CEOs cut jobs at a time when their corporations were reporting record profits. They cut jobs, helped sink the economy and put even more money in their own pockets. And now Republicans (and, unfortunately, some conservative Democrats) want to reward these richest of the rich by giving them giant tax cuts?!?
Bailing out the super rich won’t help grow the economy. It will only further grow the monstrous gap between unemployed and struggling average American workers and the elite ranks of greedy CEOs — which is part of the problem in the first place.
In the Wall Street Journal, Michael Boskin (the former chair of the Council of Economic Advisors under George W. Bush) writes: “Businesses are flush with cash and profits have been solid.” In fact, businesses have been flush with cash for over a decade but as a matter of corporate policy and culture, big business has spent its money raising CEO salaries and paying higher short-term dividends instead of hiring more workers, creating better products and services and investing in our economy’s — and our nation’s — future.
Structurally, Wall Street has encouraged this extreme greed and inequality under the rationale of “trickle down” economics. But while even the Wall Street Journal acknowledges that big business is faring just fine in this economic crisis, the estimated 75% of Americans who’ve been touched by unemployment and recession aren’t feeling a drop of that trickle.
Meanwhile, the New York Times echoed a report in the Financial Times that the business lobby is bucking against new disclosure requirements in financial reform legislation that will require corporations to compute the discrepancy between salary and benefits paid to CEOs compared with those paid to regular workers in companies. The business lobby insists the complaint over the regulation is about “logistical” challenges — but, in truth, they don’t want the failure of “trickle-down economics” to be so blatantly and indisputably proven.
The New York Times writes: “It is clear that C.E.O. pay has skyrocketed while workers’ pay has stagnated; it is also clear that skewed pay and rising income inequality correlate to bubbles and crashes.” While in 1960 the average American CEO made 61 times what the average worker in his or her company was paid, now CEOs make an average of 411 times what their workers are paid. Some CEOs make 900 times more than their lowest paid employees. Are those CEOs really working 900 times harder? Or have we rigged our economic system to help CEOs and hurt the rest of us? Income and wealth for the top 1% of America has been growing while, adjusted for inflation, the rest of us are actually working harder and harder for less and less reward.
Given all that, conservatives want to give the richest of the rich EVEN MORE money from our public pockets?
In the Constitution, our Founding Fathers gave the federal government the ability to “lay and collect taxes, duties, imposts, and excises, pay the Debts and provide for the common Defense and general Welfare of the United States.” That “general Welfare” includes distributing resources more fairly and creating equal opportunity for all. These are core American values. We recognize that the children of Donald Trump inherently start off their lives several steps ahead of your kids or mine — let alone the child of a single, young mother who doesn’t have a job or a place to live. What makes America a great nation is not that the rich get richer but that we create conditions so those who start below have a chance at catching up and even getting rich themselves. Our national pride comes from what everyday Americans are able to achieve here, not from multiplying the largess of already-successful billionaires.
But conservatives have corrupted the idea of fair distribution not just to oppose providing vital supports for poor and working class families but to endorse policies that actually re-distribute money from average Americans to the very, very rich. Make no mistake about it, when Republicans call for extending Bush-era tax breaks on the richest of the rich, that means re-distributing OUR government funds away from unemployment benefits, veterans services, food stamp programs and public schools.
The independent Council of Economic Advisors has said government spending to stimulate the economy created between 2.5 and 3.6 million jobs in the second quarter of 2010. According to the Wall Street Journal 70% of economists say that government stimulus spending helped the economy. So let’s make this simple — a dollar in the hands of government does more to help the economy and jobs (including YOUR job and YOUR family’s bottom line) than that same dollar in the hands of the richest of the rich.
Our economic crisis was caused by deep, structural problems — free trade agreements sending manufacturing jobs oversees, to decimating worker protections to letting finance capital run wild. But scholars have also found a striking correlation between inequality and economic crises — as the gap between the rich and the rest of us gets bigger, recessions erupt. Conservatives are right in accusing some of us “liberals” of seeing an opportunity within this financial crisis. We see an opportunity to finally make the American economy work for working people instead of the just the super rich.