To Over Pay CEOs, it Helps If You Can Use Tax Dollars
|December 28, 2013||Posted by Staff under Editorials|
This 2013 excerpt of OtherWords, Oct 9, is by Sam Pizzigati, author of The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class.
Those janitors who clean Smithsonian museums? Those cooks at military bases? Those programmers writing software for Medicare? More and more of the workers who keep our government running work for private contractors. And many of these workers don’t make much at all. About 560,000 Americans employed by contractors have jobs that pay $12 an hour or less.
Meanwhile, the federal government reimburses private firms for up to $763,039 of the compensation they pay executives, a figure that will shortly rise to $950,000 under federal law. The federal government is now spending $20.8 to $23.9 billion annually, overall, for the compensation of top private contractor executives.
The government pays the President $400,000, the Vice President $230,700. If government reimbursed CEO salary at $230,700, it could give a $6 an hour raise to the 560,000 federal contractor workers who currently make $12 or less an hour.
Contractors like Lockheed Martin and other weaponeers owe their robust profitability to federal contracts. This profitability keeps corporate share prices high. Stock options and other stock awards translate these high share prices into whopping executive windfalls. Lockheed’s CEO Stevens took home $23.8 million last year.
The federal government already denies our tax dollars to companies with employment practices that discriminate on the basis of race or gender. We’ve decided, as a society, not to subsidize racial or gender inequality. Why should we subsidize economic inequality?
Ed. Notes: Bigger picture, why subsidize anything? We could forget about padding the wages for low-skilled work if instead we shared the worth of Earth. If everyone got an extra income from the value of land and resources — a la Alaska’s oil dividend or Singapore’s land dividend — then people could directly negotiate higher wages without having to have government intervene. People could also afford retraining. Or maybe even start their own business. All those futures sound brighter than being locked into an undemanding, tho’ better paying, job with a boss.
Even better, if we not only paid ourselves a Citizen’s Dividend but also axed the counterproductive taxes on earnings, purchases, and houses, why would we subsidize anything, even schools and clinics? Costs of living would be lower and with income higher, we would have the wherewithal to choose our own teachers and doctors, again without having to have government intervene.
Let our concern for struggling workers, and our distaste for income inequality, blossom into a campaign for geonomic justice.