Let them eat cake.
— attributed to Marie Antoinette
Were communism not a thing of the past, one might worry that its appeal to the poor would begin to resonate with U.S. workers and it would enjoy a resurgence. Happily, that won't happen. By now the American worker is reconciled to the fact that some have it and some don't and those who don't, won't, as long as George Bush is president.
At first it was simply news of the tax cut. As Mr. Bush loves to explain, if his plan is passed there will be an average tax cut that affects rich and poor alike. Under the proposed budget, the rich will get $1.4 trillion in tax cuts. The less-affluent will receive cuts in programs that provide food stamps, school lunches, health care for the poor and disabled, etc. Nonetheless, who among the poor is so mean-spirited as to begrudge the wealthy the extra money they will get if the tax cut is passed? It is, after all, the wealthy who are the engines that drive our economy. The poor do little to help it along, being mainly the recipients of the programs that will be cut. And it's not only the tax cut that will benefit the wealthy.
A report in The Wall Street Journal gives examples of how some large companies have gone to extraordinary lengths to protect their executives from the sorts of disappointment that others have suffered. United Airlines employees saw the value of their pension plans drop from hundreds of thousands of dollars to almost nothing, thanks to the management of that company by its executives. That had a demoralizing effect on UAL rank-and-file employees and that company and others like it do not want their high-paid executives to be similarly demoralized. They won't be.
According to a recent story in The Wall Street Journal, Delta Air Lines has set up special retirement trusts of $25 million to ensure pension payments to 33 of its top executives. Delta is not alone in taking steps to protect the pensions of its high-paid executives. Altria Group Inc. (formerly known as Philip Morris) did it, as did LTV Corp., UAL Corp. and Abbott Laboratories. These trusts turn the retirement accounts over to the executives and in the unlikely event that the companies are forced to take bankruptcy, the money is protected from avaricious creditors. When money is paid to executives earlier than contemplated when the accounts were set up, the executives incur additional taxes. Not wanting to inflict that hardship on these hardworking folk, some of the companies like Delta and Abbott pay them additional amounts in order to cover the taxes. United Airlines' recently hired CEO, Glenn F. Tilton, had $4.5 million put into three trusts in his name to make up for retirement benefits he gave up in leaving his prior job at ChevronTexaco Corp.
The only slightly troubling thing about the news of the executives' compensation (and this can be blamed on neither the executives nor the media) is that the stories were prominently featured exactly one day before news of the most recent figures on unemployment were published. Talk about bad timing! The Journal story came out on April 3, and the unemployment news came out on April 4.
The news on April 4 was that the job market continued to deteriorate in March. The economy lost 108,000 jobs. The unemployment rate stayed at 5.8 percent but that is because of a rise in the number of people who are not looking for work. In the last two years employment has fallen by almost 2.4 million jobs or 1.8 percent of employment. That is worse than in the early 1990s, when employment never fell by more than 1.3 percent over a two-year period.
Not to worry, however. Help is on the way in the form of the tax cut if Congress doesn't lose heart and cut it in half. Those voting to cut the tax cut in half have probably never been unemployed and don't know what it's like. If they could stop for a moment and put themselves in the shoes of the unemployed, they would realize that anything less than the full $726 million cut is the equivalent of saying to the unemployed, "We don't care about you."
Don Evans, Secretary of the Department of Commerce, whose net worth increased to $23.8 million while serving as chairman of Tom Brown, a small oil firm based in Denver, has an understanding of money that those with less lack. On the department's Web site he is quoted as saying: "President Bush and I share the belief that governments don't create wealth and prosperity: people do. It is government's role to create the right conditions for America's workers and businesses to flourish." Talking about the need for the tax cut, he said: "Now is the time for Congress to act on the president's plan to ensure that the economic news gets better, the American economy grows stronger and American jobs grow faster. America's unemployed workers are counting on them to do so."
A tax cut that puts $90,222 in the pockets of those earning more than $1 million annually and less than $100 into the pockets of 49 percent of the rest of the employed (according to the Center on Budget and Policy Priorities) should be a big first step toward accomplishing that. The unemployed can hardly wait to find jobs so that they, too, can enjoy the benefit of the tax cut.
Christopher Brauchli is a Boulder lawyer and and writes a weekly column for the Knight Ridder news service. He can be reached at email@example.com
Copyright 2002, The Daily Camera