The Rich Getting Richer: CEO Salaries Are Soaring Again
There was a 23-paragraph story in The New York Times on Saturday. In case you don't have time to click through, the gist is something you may have heard whispered about: the rich are getting richer, and other Americans are getting ripped off.
“Middle-class America experienced a lost decade in their retirement accounts, whereas executives enjoyed record compensation packages through the subterfuge of stock option programs,” Mr. Meyer says.
“There has been a massive wealth transfer from middle-class America’s retirement accounts to the bank accounts of the privileged few. The social consequences of this wealth transfer bear scrutiny.”
On Sunday in the Times, there was a 37-paragraph story with some more details about rising executive compensation:
For the average C.E.O., however, the good times have returned. The median pay for top executives at 200 major companies was $9.6 million last year. That was a 12 percent increase over 2009, according to a study conducted for The New York Times by Equilar, a compensation consulting firm based in Redwood City, Calif.
Many if not most of the corporations run by these executives are doing better than they were in the downturn. Many businesses were hit so hard by the recession that even small improvements in sales and profits look good by comparison. But C.E.O. pay is also on the rise again at companies like Capital One and Goldman Sachs, which survived the economic storm with the help of all those taxpayer-financed bailouts.
Against such a backdrop, it’s noteworthy that recent moves to empower shareholders seem to have done little to tamp down corporate enthusiasm for paying top dollar to top executives.
A 12 percent increase for people in the top 1/20th of 1 percent of the population. That's an average raise of $110,000 a month, enough to buy a new Mercedes G550. If you want to see some individual results, check out this chart. While the Times dutifully points out that millions of Americans are having trouble paying their mortgages and millions are still part of the worst unemployment situation in the post-World War II era, there is no mention that the median pay increase for all U.S. workers who had jobs in private industry in 2010 was 2.3 percent, an average raise of $88 a month, enough for one tank of gas in a Mercedes G550.
There is a reason they call it trickle down.