The average wage level is a mere 7% higher than 30 years ago, when CEO compensation was limited to 40 times the average wage level of the CEO’s own industry.  Today CEO compensation is up 759% over 30 years ago – which is 300 times higher.  But that does not tell the whole story, considering the average compensation today of the S&P 500 Index CEOs is over $12,000,000 and the average compensation of the worker in most of these businesses is about $35,000.  Workers make more in computer related industries and the ratio of CEO comp is still at the upper level.  For fast food and retail the ratio for CEO comp is also at the top end of the scale, with food and retail workers at $30,ooo to $24,000.

Apr 15, 2013 – The chief executive officers of the S&P 500 Index companies received, on average, $12.3 million in total compensation for 2012, according to a 
Apr 30, 2013 – It’s been almost three years since Congress directed the Securities and Exchange Commission to require public companies to disclose the ratio 
Looks worse sickening when you realize this, but this is one reason so much money has been redistributed to the rich – tax laws are another. Top tax rates have been lowered, and the Bush tax laws even conferred Hedge Fund status for venture and vulture capital companies which changed ordinary income taxation from nearly 40% to capital gains tax at 15%. 

Is it any wonder that so much wealth has been redistributed to the already rich, and the already rich have lobbied incessantly to never raise the minimum wage which has created financial inequality of obscene proportions in America, the land of opportunity.  Isn’t America the land of the war against the minimum wage?

From:  “How We Got Swindled by Wall Street Godfathers, Greed & Financial Darwinism ~ The 30-Year War Against the American Dream:”

chapter 18  Executive Compensation, Reasonable or Disgusting: Tax Laws Promote Bonuses Not Dividends; No Enforcement of IRS Sec. 162(m)

The growth of Executive Compensation has been unstoppable since the mid-60s and for the past ten years has accelerated like a mushroom shaped cloud. Forty years ago the average compensation for a CEO was 25-30 times the average wage level of the CEO’s corporation. By 1980, it was up to forty times. Today it is not unusual for it to be five hundred times. The average worker’s pay, measured in terms of real dollars has essentially not increased for twenty-five years and is actually lower in buying power than thirty years ago.

Yet Congress could not figure how to “increase” the minimum wage for nineteen years. It is worse than alarming to note that not since 1929 have so few people controlled so much of the wealth. And Michelle Bachmann who wants to be your President, supported by T Party survival of the fittest pawns, wants to “get rid of the minimum wage – to create jobs!”

Congress feigned confusion, in 2009, over how top public company executives could take so much in income. A definition of income from the IRS, based on our tax code, would include all forms of remuneration: fees, bonuses, stock options, deferred compensation and retirement benefits, green parachutes, life insurance, health benefit plans which cost in excess of $40,000, the imputed value of having a plane for personal travel, cars, drivers, and clubs. …

There is a section of the Internal Revenue Service code – Sec. 162 (m) which specifically addresses unreasonable compensation for top executives of publicly held companies by limiting the deduction for remuneration paid only to what the service defines as a “covered” employee to $1 Million per year. This would not apply to the thousands of top traders and bankers; for thousands of top traders and bankers; for example, of the nine largest financial firms that in 2008 the year of the collapse, and into 2009 received more than $1M each, even at Citigroup and Bank of America. So was it logical to accept that if a bank lost billions the CEOs justified this compensation because it was paid to retain their most important people.  Clearly, paying out TARP dollars to not lose the morally bankrupt money makers was not in the interests of shareholders of worthless National City Bank stock or the United States taxpayers who bailed them out. …

The following information and discussion will not be warm and cozy reading, but it is necessary to expose the lies, misrepresentations and misunderstandings circulated at the time we were told by an ex Goldman CEO, and Secretary of the Treasury under Bush that if we did not bail out the billionaire bankers and their counterparties (their investors) with TARP we were doomed. And we were also told there was nothing that could be done about existing “contracts” to compensate the pigs that were directly culpable in creating a financial holocaust. Further, because the underlying core ethic is “Survival of the Richest,” always keep in mind unreasonable compensation is one of the key issues.

Sec.162(m) limits corporate deductions paid to certain executives to $1M. These limits apply only to publicly held corporations and to compensation paid to covered employees. There are other applicable sections which further define how this section is applied, and neither you nor I want to become tax attorneys, but it is good to know that Congress does have some existing IRS leverage to deal with swine pay. Think of the tax code as a swine-flu shot.

Early in 2008, the IRS issued Revenue Rule 2008-13 which signaled the possibility of a change in the services position toward compensation that was not “qualified performance based compensation.” As a result, compensation paid to “Covered Employees” in excess of $1MM would not produce a deduction for the public company paying the compensation. The ruling was met with an avalanche of responses from more than 90 law firms who contended the agency’s position was incorrect. This ruling is within the meaning of 162(m) (2) for readers concerned with the basis of the ruling. It is of interest to know that the IRS is concerned, even if a Congress full of lawyers is not…

Sec. 162(m)(3) defines a “Covered Employee” to include the CEO and four other highest compensated officers. There is an exception for performance based compensation. To qualify, compensation must satisfy a detailed set of rules, including being based on the achievement of specified pre-determined objective performance goals established by a compensation committee comprised of two outside directors. Everyone knows there is nothing more objective than an outside director. So corporate governance can easily navigate around this and has. I will not burden you with an in-depth discussion of the requirements of Sec.162(m)(4)(c) to be considered performance-based, but they are simply: outside director – shareholder approval – certification by compensation committee performance goals were met prior to paying compensation.

So what compensation committee would approve huge salaries and bonuses for executives of companies losing mega billions of dollars, like GM and Chrysler who are still alive because of American taxpayers? Did it make sense that traders of failed companies due to WILD AND CRAZY risks (as a function of wildly speculative volatile leverage approved by leading corporate officers) should have been paid gluttonous bonuses, or given huge severance packages by tanked companies like AIG and Citi, or Merrill? …

…how can Congress and the media get past all the misinformation, mistaken ideology and misunderstandings promulgated by zealot Financial Darwinists to reach a symbiotic agreement regarding the need to build a better, more stable financial world based on fairness and common sense?  To establish a new dialogue of understanding there must be some emphasis on finding a modicum of self-interest in the common good without destroying our Capitalistic system which has been a positive, creative force for real investment and can be again.”

So  here we are in a world where the minimum wage is below poverty level.  We are actually paying for food stamps for Walmart workers while Walmart made $17 billion of profit last year and the Walton family is the wealthiest family in the world.

It is time to raise the minimum wage and properly tax the incomes of the 400 billionaires that own a staggering percentage of all the net worth in America   Cached

Sep 21, 2012 – The net worth of the richest 400 billionaires in the United States rose 13 percent from last year to $1.7 trillion. This compares to a 1.7 percent 

Isn’t time to just say no to the “job creators” and change the tax law give aways and stop this massive redistribution of wealth to so many sociopathic greedy narcissists who are firmly against the social welfare of most Americans?


Buy my book from Amazon, about which David Satterfield, former Business Editor of the Miami Herald and two times Pulitzer Prize Winner, said this:

This should be must-reading for every policy maker in Washington and every student of economics and finance.”

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  1. PJenny

    759% is 7.59 “times”, not 759. For example, if I have $5, and increase it by 100%, I’ll have $10. Are you sure this math (759 x 40 = 30,369) is correct?

  2. Good catch on that math, but still not exact. It’s a 759% increase OVER what it was so 7.59*40+40 = (7.59+1)*40 = 343. Even so, there are probably more obscure ways to interpret the text. Regardless of the exact numbers, the message remains the same. Workers produce more and more wealth and the fat cats at the top get most of it.

    • for PJenny and Duane and anyone else. I did not do the math – Oops,(Rick Perry) – first my daughter who had all As in math and in calculus in college, did the math, must not have listened to my question about the number; and now my youngest daughter has corrected the number, so maybe it is correct. I appreciate your help and know what I do not know, so math is not my basic talent, but the issue and substance are accurate, so fuck the math and the COE’s who take such advantage of people who work hard while the job creators suck up all the profits. And Duane, you are spot on – however, I am good at subtraction – and the wage against proper wages is also a subtraction from demand from consumers without enough disposable income to consume.