Friday, July 08, 2011
Bonanza Column 243 - Who Are the GOP Working For?
The New York Times reports that high-ranking executives at 200 of the biggest U.S. companies saw their pay increase an average of 23 percent from 2009 to 2010, bringing them close to pre-recession earnings. Those big paychecks didn't trickle down to the rest of the workforce, with the average American employee seeing less than a 1 percent increase in pay. The average CEO made $10.8 million last year, with CEO Philippe Dauman leading the pack with a whopping $84.5 million.
You read it right – eighty-four and a half million dollars. Now I’m sure Viacom is a very nice company – they are in the entertainment business, and it’s hard to fault that. Still, after a lifetime of working with some top CEOs, I can’t imagine anyone being worth that kind of money, or even $10.8 million, particularly when the people who are actually doing the work that earns the company its money get a 1% increase against 23% for top executives.
In addition to working with CEOs and top executives as a consultant, I’ve been an executive myself, and I don’t subscribe to the view that “the suits” or “the people on the top floor” don’t produce anything of value. On the contrary, it’s been my experience that the work of strategic design and strategy execution are what allow companies to grow, innovate, and be profitable and what allow employees to focus on customer service, quality, and sales. Still, if the top salesperson in a company makes, say, $250,000 per year and top executives make $10 million, it’s hard for me to imagine that what the executives do is worth 40 times more to the company than what the salesperson does.
All this becomes more relevant when you consider the current debate between the GOP and the Democrats over closing tax loopholes for the wealthiest Americans (In case you’ve been living in a cave, the GOP opposes this). Now the Right would have you believe that the debate is over raising taxes “on the American people,” but what the Obama Administration and Congressional Democrats want is to raise revenues by closing tax loopholes and exceptions for the very wealthiest Americans, not for the middle or working classes. Republicans, on the other hand, under the dubious banner of “no tax increases” would reduce spending by cuts in programs like Social Security and Medicare.
However they clothe it, it’s hard to escape the conclusion that the GOP, or at least the right wing of the GOP, which seems to be driving the Republican train, don’t really care about the vast majority of Americans. According to factcheck.org, roughly one family in 50 will make over $250,000 this year – that’s 2% of the population that would be affected by closing tax loopholes or even raising taxes on those making more than a quarter million a year. Said another way, the GOP is fine with protecting this 2% at the expense of 98% of the people in the US.
I know this is not a popular argument here in Incline Village, where probably the percentage with incomes over $250k is considerably higher than 2%. But for humanity’s sake, what happened to noblesse oblige, the idea that people born into the upper social classes must behave in an honorable and generous way toward those less privileged?
If the United States is not to become a two-class society¸ with a huge working class supporting a privileged few, Republicans in Congress will have to stop pandering to their wealthy patrons and lying to people about who is paying their freight, and start thinking in terms of what’s good for the people who elected them.