A Year of Contrasts: Courage, Sacrifice and …Corporate Greed
As we reflect on the year 2001, our minds catapult to the World Trade Center in flames and hundreds of courageous firemen and police officers racing up stairs to try to save their trapped fellow citizens. Almost all of them gave their lives in this heroic effort.
For the last several months, the nation has been impressed by the dedication and discipline of American troops in Afghanistan successfully fighting to help rid the world of international terrorism. Some of these young people have died or been wounded.
Throughout the country, in the wake of September 11th, there has been a growing sense of coming together and shared sacrifice. Hundreds of millions of dollars have been donated to special funds for the families of the victims, and Americans are taking a deeper look at the meaning of their lives.
And then of course there are the titans of corporate America. Unfortunately, for many of them, it’s the same old story. Greed, greed and more greed.
Case in point is the Enron Corporation, which, just last year, was the seventh largest company in America with revenue exceeding $100 billion and over 20,000 employees. Having contributed millions in campaign contributions to the Republican Party and the President, the company was strongly positioned to influence the direction of energy policies in the Bush Administration. One of the results of their efforts was a huge increase in electric rates in California.
Earlier this year, Enron was forced to admit that it had over-reported its profits by nearly $600 million. This led to the largest bankruptcy in history. While Enron was exaggerating its profits, and before its artificially high stock price plummeted, three top executives in the company, Lou Pai, Kenneth Lay and Jeff Skilling cashed in stock options worth some $560 million. Like rats on a sinking ship, they got their money out just in time. But they didn’t give that same opportunity to their employees. While Enron’s stock was crashing, the company forced more than 12,000 of its employees to retain Enron stock in their 401(k) pension plans. This caused massive losses for the workers and many lost their entire retirement savings.
Taxpayers will be delighted to know that the House Republicans included a $254 million corporate welfare check for Enron as part of their so-called “economic stimulus plan.” But it’s not just Enron.
The American people continue to pay by far the highest prices in the world for prescription drugs. Many of the same drugs sold in this country by American drug companies are sold abroad at a fraction of the price. The result is that millions of Americans suffer, and some die, because they are unable to afford the medicine they need.
Meanwhile, year after year, drug companies constitute the most profitable industry in our country. Last year, they had profits that exceeded $30 billion. At a time when elderly citizens cut their dosages in half, nine executives at the top pharmaceutical corporations in the U.S. were given $890 million in stock options according to Families USA. This is on top of the $169.9 million in wages, bonuses and other compensation that these executives are already receiving.
How does the pharmaceutical industry manage to rip off the American people, generate huge profits, get massive tax breaks and provide outrageous compensation packages for their top management? Easy. As the wealthiest political lobby in Washington they have spent, over the last three years, more than $200 million in campaign contributions, lobbying activities and media advertising
Even in the face of the bioterrorism attack on the United States, the drug giants are choosing profits over the health of the American people. When the federal government chose to stockpile the antibiotic Cipro, the “deal” struck with the drug companies requires the government to pay far more than is charged by generic manufacturers abroad, and, in fact, more than the federal government itself already pays under a different program.
But wait, corporate self-dealing doesn’t end there. Take, for example, Big Blue. As the holiday season approached, IBM announced a new round of job cuts. According to published news reports, the company has cut more than 5,000 jobs in the United States since July. Meanwhile, they are building two new micro-processing plants in China where workers are paid a fraction of what American workers receive. To IBM watchers, this latest act is par for the course.
Two years ago, despite record-breaking profits and a pension fund surplus of some $10 billion, IBM slashed pension and retirement health benefits for workers in 1999 and 2000 and curtailed salaries in 2001. Meanwhile, the CEO of IBM, Louis Gerstner, raked in $176 million in total compensation and stock options over the past 2 years. In addition, he has accumulated over $260 million in unexercised stock options from IBM during his tenure. While slashing the pension plans of IBM employees, he negotiated a retirement plan over $1.1 million a year for himself.
Once again, no bad deed goes unrewarded. If the House Republican leadership gets its way IBM will receive $1.4 billion in corporate welfare this year.
This country has gone through an extremely traumatic year, and we are now confronting serious economic and security issues. It would be nice if, for once, some of our corporate leaders looked out for someone other than themselves.