THE WEEKEND to celebrate the fruits of our labor has been supplanted by the
shock of discovering that the orchard has been picked clean, with only the cores
of 401(k)s left scattered on the ground. Undaunted, Americans will flock to the
beach for one last moment of solar serenity, hoping that when they return to the
parking lot they will not discover that the CEOs have struck again, leaving broken
glass and a hole in the glove compartment where the wallet used to be.
That assumes that the car itself will be there.
Most Americans scream when their wallet or car is actually stolen. They scream if somone comes into their garden to pilfer the fruit. This summer $5 trillion of paper wealth is missing in the dot-com crashes and book-cooking scandals highlighted by the collapses of Enron, WorldCom, Global Crossing, and Arthur Andersen. It remains to be seen whether this historic theft of American labor is enough to inspire a revolutionary yell against renegade capitalism.
Up to now, corporate America has successfully distracted us from white-collar crime by throwing us a lot of toys to make us think we feel the power - cellphones, big-screen TVs, PCs, DVDs, and SUVs. Politicians and the media have distracted us with stereotypes. In the 1980s and '90s, the symbol of greed was welfare mothers, not the corporate welfare kings and queens whose tax breaks cost the federal treasury a quarter of a trillion dollars a year, according to Pulitzer Prize-winning reporters Donald Bartlett and James Steele. That was 11 times more than welfare for the poor.
The symbol of crime was African-American and Latino drug offenders, many of whom were nonviolent yet were swept into prison under long mandatory sentences. The public railed against educational and recreational amenities for them while the few white-collar criminals who went to jail went to plush facilities and were allowed to keep millions of dollars.
It is no wonder CEOs felt free to raid the orchard. In 1982, the average CEO made 42 times more money than an average production worker. Today, CEOs make 411 times more, according to the progressive think tanks United for a Fair Economy and the Institute for Policy Studies.
If production workers had received the same rate of pay increases that CEOs received from 1990 to 2001, production workers, according to the two think tanks, would be making an average of $101,156 a year instead of $25,467. The minimum wage, if it had grown at the same rate as CEO pay, would now be $21.41 an hour instead of $5.15.
Such statistics used to be ignored as coming from liberal sourpusses. After all, with that cellphone in the SUV, people felt too powerful to identify with the working class. No more. Pro-business publications are now saying things have gone too far.
Fortune magazine figured out that at 25 companies that lost at least 75 percent of their stock value since 1999, a mere 466 people cashed out for $23 billion. That happens to match what the federal government annually spent on welfare for 14 million poor people in the early 1990s.
Fortune, whose fortune usually depends on reporting on people's fortunes, was compelled to write: ''The billions of dollars of insider sales make absurd many of the rationales executives used to justify their wealth. Take, for instance, the notion that executives were being rewarded for performance. Plainly, the executives on this list did not perform. They failed miserably.''
Researchers at the Brookings Institution estimate that the corporate scandals could cost the economy $35 billion over the next year. The Financial Times calculates that since the beginning of 2001, 100,000 people have lost their jobs at the 25 largest American companies to collapse.
Suddenly people are talking about working past their retirement age because of stock losses at the very time that companies cut the average work week in July back to 34 hours a week, the shortest average since 1964 except for brief blips caused by Sept. 11 and an eastern blizzard in 1996.
Since March of last year, the United States has experienced a net loss of 1.7 million jobs. Nearly a third of the losses came in the telecom industry, according to Business Week, as the likes of Global Crossing, WorldCom, and Qwest were going bankrupt or cooking their books.
That would seem to represent a theft worth screaming about. As Americans return from the beach, they can no longer just gawk at the empty orchard and shrug their shoulders at the stolen fruit. Calling for one or two swindlers to be jailed will not do. Americans have to look past the cellphone, past the big screen, and past distracting stereotypes to demand that the system itself can no longer pay CEOs 400 times more than workers. The scandals give the people a glowing chance to demand that their sweat be rewarded instead of watching it evaporate like their 401(k)s.
Copyright 2002 Boston Globe Company