If CEOs cared about the economy . . .
Chuck Sheketoff
According the newly published report Executive Excess 2011 by the Institute for Policy Studies, of last year’s 100 highest-paid corporate chief executives in the United States, 25 took home more in CEO pay than their company paid in 2010 federal income taxes.
The report also noted that in 2010 S&P 500 CEOs collected $10.8 million in average compensation, including the value of new stock and options grants awarded during the year — a 27.8 percent compensation increase over 2009.
With this pay increase, the gap between CEO and average U.S. worker pay rose from 263-to-1 in 2009 to 325-to-1 last year, according to the report.
The gulf between CEO and average worker pay is part of the larger phenomenon of income inequality, which stands at near historic levels.
As OCPP’s latest commentary notes, income inequality is bad for business and the broader economy:
Business is booming . . . for those catering to the rich. The New York Times recently reported that luxury retailers are seeing $9,000 tweed coats and $1,400 shoes fly off the shelves.
But far from taking flight, the nation’s economic recovery may have stalled. And it never got off the ground for much of Main Street.
As concern lingers over the possibility of a double-dip recession, lawmakers in both Oregon and the nation’s capital would be wise to listen to the growing chorus of economists and business people now drawing a link between income inequality and economic weakness.
If CEOs cared about the economy they’d help curb income inequality.
Read Narrow the Income Gap to Lift the Economy and discuss.
Chuck Sheketoff is the executive director of the Oregon Center for Public Policy. You can sign up to receive email notification of OCPP materials at www.ocpp.org.
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12:39 p.m.
Sep 2, '11
Chuck, As I have mentioned before, I believe that the corporate bosses think they don't need a middle class in the US any more, having new markets in China, India, and Brazil, for example. The editor of Advertising Age recently commented that ads targeted at other than the rich are a waste of money. And there is now running on network TV an ad for an Audi in which the price is given down in the corner: $78,000. That is to assure that the right viewers get the message and to exclude the rest of us.
What to do? The same old same old won't get the bosses to care about a middle class here at home. A change I'd like to see: workers represented on the boards of the huge corporations that dominate their sector, participating in decisions about investments, production, profit distribution, and wages. That's an important site for the struggle to preserve our middle class.
3:44 p.m.
Sep 2, '11
Corporations and their CEOs are about maximizing shareholder value, regardless of those warm and fuzzy sponsorship announcements on OPB/PBS. If we want to save the middle class, we need to look to elected leaders and to progressive legislation. I don't blame GE if they offshore jobs or their taxible "situs" to make more money and save taxes beause that is what corporations are supposed to do. At this moment, I think the US electorate is undecided on whether they want to save the middle class. Time will tell.