CEOs Get One-Third of All Pay; Bank of America Uses Taxpayer $$ for Lobbying
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Two news items out today highlight how far the nation needs to go in re-balancing the economy toward working people.
First, Think Progress points to a Wall Street Journal analysis that shows more than one-third of all pay in the U.S. now goes to executives and other highly-paid employees.
Highly paid employees received nearly $2.1 trillion of the $6.4 trillion in total U.S. pay in 2007, the latest figures available. The compensation numbers don’t include incentive stock options, unexercised stock options, unvested restricted stock units and certain benefits.
The Wall Street Journal based its analysis on Social Security Administration data, which doesn’t count billions of dollars more in pay that remain off federal radar screens that measure wages and salaries.
Next, it turns out that Bank of America, which received $45 billion in taxpayer-funded bailout support, has spent more than $1.5 million lobbying on Capitol Hill.
The Charlotte, N.C., company wants flexibility on spending the bailout funds and also wants to fend off restrictions on executive compensation, home mortgage lending and credit card fees. The bank also is lobbying on a consumer rights bill, on student lending issues, on a bill that would’ve allowed bankruptcy judges to alter mortgages and on a proposed federal regulatory oversight agency.
And none of its positions on any of these bills would help working families.
As we noted in April when we released the AFL-CIO Executive PayWatch data, the Bank of America lost nearly $2.4 billion in the fourth quarter of 2008 due to deeper than expected trading and loan losses. Even after receiving billions of dollars in taxpayer money, the bank plans to eliminate up to 35,000 jobs over the next three years—but CEO Kenneth Lewis collected nearly $10 million in 2008, more than 400 times the average amount a bank teller is paid each year. Since becoming CEO in April 2001, Lewis received $134 million in pay, bonuses, stock awards and pension accruals.
As Think Progress notes, between 1979 and 2006, the inflation-adjusted after-tax income of the richest 1 percent of households increased by 256 percent, compared with 21 percent for families in the middle income quintile.
While U.S. worker productivity has skyrocketed over the past 30 years, wages have not kept pace.
America’s working middle class made it clear last November that they wanted change—and reshaping the nation’s economic framework to strengthen the middle class and close the wage disparity between the very top and the rest of us, is fundamental to that change.
CEOs Protected by Big Contracts Make Sure Their Employees Aren’t
The AFL-CIO’s new Executive PayWatch data shows that many CEOs and top execs have contracts that give them high pay, job security and numerous benefits. Yet these same executives are fighting a vicious battle to prevent their workers from having an opportunity to get workplace contracts by opposing passage of the Employee Free Choice Act.
A big double standard is at work here—corporations are giving generous contracts to top execs with one hand while suppressing workers’ freedom to form unions with the other.
Take Wal-Mart, one of the most active opponents of the Employee Free Choice Act and its workers’ freedom to form unions. Wal-Mart went so far as to warn store managers not to vote for Obama last fall, and former Wal-Mart CEO Lee Scott summed up corporate opposition to Employee Free Choice like this:
We like driving the car and we’re not going to give the steering wheel to anybody but us.
Citigroup Uses Taypayer Dollars to Fight Workers’ Rights
It seems that another bank on the public dole is using its taxpayer-subsidized time and resources to lobby against the Employee Free Choice Act.
Today, Sam Stein of the Huffington Post reports that Citigroup hosted a private conference call yesterday to bolster opposition to the Employee Free Choice Act that included a senior executive at the U.S. Chamber of Commerce, a business lobbying group that has put tens of millions of dollars into the anti-Employee Free Choice disinformation campaign. Jane Hamsher at Firedoglake notes that the Citi stock analyst who downgraded Wal-Mart over fears of the Employee Free Choice Act passing was on the call, too.
Citigroup, the Huffington Post reports, has received some $50 billion in federal bailout funds—funds that are meant, in theory, to shore up the financial system, not allow Big Business to continue to distort the political process and lobby against critical legislation.
Did Opponents of Employee Free Choice Break the Law?
Last year, major opponents of the Employee Free Choice Act took part in a conference call, organized by a giant banking institution that was set to receive taxpayer bailout funds, in which they insisted that CEOs and industry contribute to anti-Employee Free Choice Act candidates for public office. That violates the law, says a complaint filed this morning by the AFL-CIO and Change to Win.
The complaint against the Center for Union Facts and the Marcus Foundation alleges that their leaders, Richard Berman and Bernie Marcus, took part in the call organized by Bank of America last year. Marcus and Berman were organizing corporate donors to fight the Employee Free Choice Act and solicited donations to Berman’s organization and to specific candidates hoping to influence the election and prevent passage of the Employee Free Choice Act, a bill that would protect workers’ freedom to form unions and bargain.
Were Bailout Funds Used to Plot Against Employee Free Choice?
This week, we learned that shortly after the approval of billions in bailout funding for major banks, at least two bailout recipients were involved in a conference call for lobbyists and Big Business figures plotting to defeat the Employee Free Choice Act.
Now, a coalition of five major government-reform groups is asking Congress to fulfill its duty of overseeing the bailout funds and making sure they aren’t being used for political purposes like fighting the freedom to form unions.
In a letter sent to Congress today, leaders of Public Citizen, U.S. PIRG, Change Congress, Democracy Matters and Public Campaign asked for an investigation into whether taxpayer dollars are being spent on political influence-peddling.
This story may be the tip of the iceberg. That’s why we’re calling for Congress to investigate whether Bank of America, AIG, or other recipients of billions in bailout money used taxpayer dollars to send “large contributions” to any political organizations.
Bailed-Out Bank Uses Taxpayer Cash to Fight Employee Free Choice
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When Congress entrusted billions of dollars to banks last fall, it wasn’t with the expectation our taxpayer money would be used to hustle for political campaign cash, spread disinformation and fight legislation aimed at improving the economy for everyone. Yet that’s exactly what Bank of America did last fall, coordinating CEOs and lobbyists to oppose the Employee Free Choice Act.
According to reporting by Sam Stein in The Huffington Post, within three days of being approved for $25 billion in taxpayers’ money, Bank of America officials hosted an Oct. 17 conference call with key corporate leaders to strategize about the upcoming election and how to fight the Employee Free Choice Act in the next Congress. Stein obtained audio of the call, led by mega-lobbyist Rick Berman and Bernie Marcus, founder and former CEO of Home Depot. The call, which included major finance industry figures and representatives from big corporations (including AIG, itself a recipient of $85 billion in taxpayer-funded loans), featured apocalyptic rhetoric and demands that those on the call donate to anti-Employee Free Choice Act politicians. (Click here and check out the audio samples from the call.)
Three Cheers for Workers Who Waged the Sit-In
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Congratulations to workers at Republic Windows & Doors who made justice happen. After a six-day sit-in at the plant, workers at Republic Windows & Doors in Chicago voted to accept a settlement late last night.
This from the United Electrical, Radio and Machine Workers of America (UE) site, via Jobs with Justice:
The settlement totals $1.75 million. It will provide the workers with:
- Eight weeks of pay they are owed under the federal WARN Act;
- Two months of continued health coverage; and
- Pay for all accrued and unused vacation.
JPMorgan Chase will provide $400,000 of the settlement, with the balance coming from Bank of America. Although the money will be provided as a loan to Republic Windows and Doors, it will go directly into a third-party fund whose sole purpose is to pay the workers what is owed them. In addition, the UE has started the “Window of Opportunity Fund” dedicated to re-opening the plant.
Victory for the Sit-In Strikers
This just in from AP:
Bank of America says it will extend credit to a Chicago window and door manufacturer whose workers have occupied the factory for five days.
The bank says it’s willing to give the Republic Windows and Doors factory “a limited amount of additional loans” so it can resolves claims of employees who have staged a sit-in since Friday.
This is the same Bank of America that, after receiving $25 million in taxpayer bailout cash, cut off the company’s line of credit. The factory closed Friday and told workers they would not receive severance and accrued vacation pay.
10 Reasons to Support the U.S. Auto Industry
Chances are the upcoming holiday get-togethers will provide plenty of encounters with relatives and friends who are against helping out the auto industry. Opponents of a bridge loan have plenty to say. And we should, too. Here’s a quick list of reasons for countering arguments by Uncle CEO and Cousin It.
1. Unlike the taxpayer giveaway to Wall Street, the funds for the auto industry are loans. These loans have to be paid back. The Big Banks who got our $700 billion get to keep it.
2. It’s cheaper to support the auto industry than to let it die. Anderson Economic Group and BBK Ltd. determined that over a two-year period, a $30 billion bridge loan with only half of the amount repaid would result in a $16.4 billion cost to taxpayers in lost sales, taxes and jobs, while a bankruptcy would cost $65.9 billion when costs for pensions, unemployment insurance, loan losses and professional and other fees are added.
Worker Sit-In Highlights the Shift in the Political Winds
What a difference an election makes. Here’s what President-elect Barack Obama has to say about the 250 workers in Chicago who have staged a peaceful sit-in at the factory they worked at after it closed without paying them their salaries. From Bloomberg:
“I think they’re absolutely right,” Obama said today in response to a question at a Chicago news conference. “And understand that what’s happening to them is reflective of what’s happening across this economy.”
Obama said the workers are justified in demanding their benefits and pay.
