Thursday, August 29, 2013

Taxpayer Dollars Paid A Third Of Richest Corporate CEOs: Report


Since the inception of our site a little over a year ago, we have published more than a few article on the greediest among us - the upper 1 percent.

Such articles as "The Very Rich Are Different Than You And Me (http://www.criminalizeconservatism.com/2013/03/the-very-rich-are-different-from-you.html)," "The Rich Are Greedier Than The Poor...WAY Greedierhttp://www.criminalizeconservatism.com/2012/08/the-rich-are-greedier-than-poorway.html)," "Who Are The Rich 1 Percent? (http://www.criminalizeconservatism.com/2012/08/who-are-rich-1-percent.html)," "The Wealthy: Entitled, Greedy, And Narcissistic (http://www.criminalizeconservatism.com/2013/08/the-wealthy-entitled-greedy-and-narcissistic.html)," and "3 Conservative Lies Keep Taxes Low On The Wealthy (http://www.criminalizeconservatism.com/2012/11/3-conservative-lies-to-keep-taxes-low.html)" come to mind as we've explored the basic philosophy of the American Conservative: the quest for complete control of the 98 percent of us by the upper class.

"Taxpayer Dollars Paid A Third Of Richest Corporate CEOs: Report," a report by Katherine Burkhart at Huffingtonpost.com helps complete the portrait of America's captivity by the Rich Gone Wild:


"WASHINGTON -- More than one-third of the nation's highest-paid CEOs from the past two decades led companies that were subsidized by American taxpayers, according to a report released Wednesday by the Institute for Policy Studies, a liberal think tank.

"'Financial bailouts offer just one example of how a significant number of America's CEO pay leaders owe much of their good fortune to America's taxpayers,' reads the report. 'Government contracts offer another.'

"IPS has been publishing annual reports on executive compensation since 1993, tracking the 25 highest-paid CEOs each year and analyzing trends in payouts. Of the 500 total company listings, 103 were banks that received government bailouts under the Troubled Asset Relief Program, while another 62 were among the nation's most prolific government contractors.

"Many of the companies appeared multiple times on the annual top 25 list, with Bank of America appearing 18 times, Citigroup appearing 15 times, while Morgan Stanley and American Express each secured 12 slots. JPMorgan Chase CEO Jamie Dimon has landed on the list twice since the bank received $10 billion under TARP, and American Express CEO Kenneth Chenault has appeared three times since his company accepted $3.4 billion in bailout money. Goldman Sachs received $10 billion under TARP, and made the list seven times in the past two decades, once after receiving its bailout. Washington Mutual and Lehman Brothers, both of which failed in 2008, also appeared on the list, with Leman making eight appearances before filing for bankruptcy.

"Banks piled on financial risk in the years leading up to the banking crash, fueling record profits from their investments. Those high profits translated into strong 'performance-based' bonuses and stock compensation. But when the risk backfired in 2008, companies either collapsed or were rescued by taxpayers.
"But our analysis reveals widespread poor performance within America's elite CEO circles. Chief executives performing poorly -- and blatantly so -- have consistently populated the ranks of our nation's top-paid CEOs over the last two decades."
"Citigroup, Goldman, American Express and JPMorgan declined to comment for this article. Morgan Stanley emphasized that the company has not appeared on the list of the 25 highest-paid CEOs since receiving TARP money. Wells Fargo told HuffPost that its CEO pay packages were necessary to retain top talent; the bank received $25 billion from TARP.

"'We take a disciplined approach for determining compensation based on four principles: pay for performance, promote a culture of risk management that avoids unnecessary or excessive risk taking, attract and retain highly qualified executives with competitive pay, and align executives' interests with those of stockholders,' Wells Fargo spokesman Michael McCoy said.
"'Sky-high CEO pay purportedly reflects the superior value that elite chief executives add to their enterprises and the broader U.S. economy,' IPS wrote. 'But our analysis reveals widespread poor performance within America's elite CEO circles. Chief executives performing poorly -- and blatantly so -- have consistently populated the ranks of our nation's top-paid CEOs over the last two decades.'


"About 12 percent of the 500 CEOs listed comprised executives who ran firms that did extensive business with the federal government. IBM landed on the top CEO pay list 11 times, securing about $11 billion in total government contracts during those years, while General Electric appeared on the annual list eight times, with $16.5 billion in contracts. GE also has a large banking wing, which issued more than $70 billion in debt guaranteed by the federal government at the height of the financial crisis, making it one of the biggest beneficiaries of the bank rescue.

"'Approximately 4 percent of GE's annual revenues come from sales to the U.S. government, primarily work to support the U.S. military,' GE spokesman Seth Martin told HuffPost. Martin emphasized that none of its government-backed debt defaulted, and that the company paid taxpayers $2.3 billion in guarantee fees as part of the program.

"Major government contractor United Technologies has appeared on the annual highest-paid CEO list six times, bringing in $32.8 billion in government business, while Lockheed Martin has scored five appearances, generating a total of $125 billion from government contracts from those years.

"'Competitive executive compensation is critical to attracting and retaining key talent. The objective of our compensation program is to align pay to performance,' said a Lockheed Martin spokesperson. 'The program is designed to provide employees with a competitive compensation package that rewards performance against specific identified financial, strategic, and operational goals that the compensation committee and the board believe are critical to the corporation's long-term success and the achievement of sustainable long-term total return to our stockholders.'


"Executive pay has steadily increased relative to average worker pay for several decades, but has exploded since 1993. That year, CEOs of companies in the S&P 500 Index made an average of 195 times as much their average worker. By 2012, that ratio had ballooned to 354 to 1.

"Even corporations that do not do business with the government or receive bailouts receive subsidies for CEO pay. All companies are currently able to deduct unlimited amounts in CEO pay from their federal tax bills, so long as the pay takes the form of 'performance-based' compensation such as bonuses or stock payments.

"The 2010 Dodd-Frank financial reform bill required all corporations to disclose more information about executive pay, and publish a simple ratio comparing the pay of a company's CEO to the pay of its average worker. The bill also directed regulators to bar any pay scheme that 'encourages inappropriate risk.' Regulators have not finalized those rules in the ensuing three years since the bill's passage.

"The IPS report also chronicles the lack of representation of women at the most lucrative private-sector positions, noting that just four women have appeared on the list of 25 highest-paid CEOs over last 20 years. While women remain statistically underrepresented in Congress, the report notes, the percentage of women has at least climbed from 10 percent to 18 percent in the last two decades."

Read the full report.


*****


The gobbledygook from the Lockheed Martin spokesperson, "'Competitive executive compensation is critical to attracting and retaining key talent. The objective of our compensation program is to align pay to performance," and "The program is designed to provide employees with a competitive compensation package that rewards performance against specific identified financial, strategic, and operational goals that the compensation committee and the board believe are critical to the corporation's long-term success and the achievement of sustainable long-term total return to our stockholders," points to the mantra used by corporations for decades over decades: the taxpayers take second place to the profits of the company, so it's all right if the corporation steals from the taxpayers.

Much of what we now see in the ongoing Fall of The American Empire would have captured the imaginations of Marx and Engels, and the road to Communism that they predicted was thwarted by the rise of the American Middle Class.  But the Middle Class has been shrinking overnight, the depreciation of its wealth commensurate with the increase in the wealth of the 1 percent, and the rich better watch out.


The crimes abound, and when the Sheldon Adelsons and Koch brothers of the world are able to fund their Conservative minions in office in exactly the way that criminal syndicates bribed their pet legislators in the past, it stands to reason: today's Conservatives are no different than yesterday's Syndicate hoods - except today's capos are protected by their people in the Supreme Court.



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"While we are reading, we are all Don Quixote."

Mason Cooley.  (American aphorist.  1927 - 2002.)

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