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Corporate America is back! The recession is over, corporate profits rose by 47 percent last year, and these giants are now awash in cash, having some $2 trillion stashed in their vaults. So, at last, the directors of corporate America are declaring that it’s time for long-suffering employees to see their paychecks catch up to pre-recession levels.
Great, huh?
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Oh, I hope you didn’t think they meant your paycheck. No, no, Bucko. It’s the CEOs the directors are concerned about. While plain old workers did receive a two-percent boost in their wages in the past year, practically every penny of this tiny increase was gobbled up by inflation. But top executives did much, much better, enjoying a median pay hike of 27 percent more than they got the previous year. This adds up to a nice round number of $9 million in pay for each of them.
Of course, many did far better than that mid-level number. The barista-in-chief at Starbucks, for example, poured $21 million into his cup. The big cheese at Disney Inc. snapped up $28 million for his year at the helm of the Mickey Mouse empire. Black & Decker’s top tool got $32 million. But the richest haul of all was made by the honcho of the media giant, Viacom – he reeled in $84 million.
Yes, I know that they point to that 47 percent rise in overall profit levels as the reason these soaring paychecks are warranted. But take a closer peek at that number. The profit performance is mostly due to eliminating the jobs of thousands of workers last year and downsizing the hours and wages of others. Real profit – derived from increased sales – edged up by only seven percent.
How’s that for “shared sacrifice” in hard times? Workers get offed, which artificially inflates the bottom line, letting CEOs cash in on middle class misery.
“CEO pay soars while workers’ pay stalls,” USA Today,” April 1, 2011.