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"If we shifted gears and only extended taxpayer-funded contracts and subsidies to corporations that limited their CEO pay to no more than 25 or 50 times worker pay," writes Pizzigati, '"top execs at companies that get our tax dollars would have an ever-present incentive to raise their worker pay, not squeeze it."
(Photo by Ben Rosett on Unsplash)
Titanic Pay for Corporate CEOs Leaves Workers Drowning
Should we care about these astounding sums now filling the pockets of our top corporate execs? We sure should.
Jul 11, 2023
Can you imagine a president of the United States proposing a federal budget that quadruples the paychecks that go to top federal officials? Of course not. No president would dare risk wandering down that road. America’s taxpayers, our top pols understand, have a distinct aversion to seeing anyone get rich off their tax dollars.
Pay rates for top executives within the federal government reflect that aversion. The U.S. Department of Health and Human Services has, for instance, over 80,000 employees, and the work these employees do can literally make the difference between life and death for millions of people the world over. Yet the top executive at HHS, Xavier Becerra, last year took home less than $250,000 in compensation.
Within Corporate America’s top executive suites, by contrast, $250,000 wouldn’t even rate as a decent paycheck for a mere week’s worth of labor. Last year’s highest-paid U.S. CEOs pocketed over $250,000 per day.
Should we care about these astounding sums now filling the pockets of our top corporate execs? We sure should. Unlike cabinet secretaries like Xavier Becerra, corporate execs are getting rich off our tax dollars. Large numbers of these execs are either running corporations with massive federal contracts or annually raking in fistfuls of federal subsidies.
Need some specifics? Consider the pharmaceutical industry and the race against Covid. Back in 2012, notes a just-published Fierce Pharma analysis, five biopharma CEOs pocketed over $18 million in annual compensation. Last year, biopharma’s 15 highest-paid execs all took home at least $19 million. Their ranks included the CEOs at the two most prominent Covid vaccine firms: Pfizer’s Albert Bourla and Moderna’s Stefane Bancel. In 2022, their paychecks together totaled over $52 million.
What did execs like these two CEOs do to reap their immense windfalls? They surfed a Covid wave of tax dollars. That wave enabled their personal “success.” Notes a Health Affairs journal analysis: “The government invested extensively in every aspect of the basic science, preclinical development, and clinical trials for the vaccines.” Tax dollars even “reduced manufacturing risk by underwriting capacity investments.”
Overall, as data from the People’s Vaccine Alliance would show, the “excessive profits” Big Pharma giants made off Covid vaccines created “at least” nine new billion-dollar fortunes in the pandemic’s first year alone.
We have, unfortunately, learned little in the way of lessons from our Covid experience. Our tax dollars, a new study from Good Jobs First indicates, are now turbocharging supersized climate-change fortunes.
The just-released Good Jobs First analysis — Power Outrage: Will Heavily Subsidized Battery Factories Generate Substandard Jobs? — examines a little-known provision in the 2022 Inflation Reduction Act that may end up costing U.S. taxpayers more than $200 billion over the next decade, a sum above and beyond the $13 billion that state and local governments have promised as battery incentives.
We clearly can create a more equal United States.
Lawmakers see all those billions of tax dollars as a generator of good wages, but nothing in the battery subsidy fine-print mandates — or even incentivizes — decent worker paychecks. Ford Motor, for instance, will be eligible for $6.7 billion in federal subsidies for its new $3.5-billion battery plant in Michigan, and state and local officials have already handed Ford $1.7 billion for that plant.
How does that math play out for real-life workers?
“The company has promised to create 2,500 new jobs that it says will pay an average annual wage of just $45,000 a year,” Good Jobs First points out, “while reaping subsidies of $3.4 million per job.”
The Good Jobs First study offers a variety of policy proposals “to set the country’s emerging EV-battery industrial complex on the path to ‘high road’ employment,” steps ranging from requiring subsidy recipients to pay wages that at least match the local market rate to including contract provisions that “claw back” tax-dollar subsidies should companies fail to deliver the jobs they’ve promised.
Will steps like these be enough to ensure that the benefits of the transition to electric vehicles get “justly shared,” as the Good Jobs First report puts it, “with the workers and communities building America’s fossil-free economy”? Not unless we also take steps that meaningfully discourage any attempts by top corporate execs to grab much more than their “fair share” of federal tax dollars.
How could we do that discouraging? We could include in every government contract and subsidy provisions that deny public tax dollars to firms that compensate their top execs at over 25 or 50 times the compensation that goes to their workers.
A bit of historical perspective: Back in the mid-20th century, few corporate chiefs pocketed over 20 times the annual compensation of their average workers. CEOs at major U.S. corporations, the Economic Policy Institute reported last fall, are now averaging nearly 400 times worker annual pay.
If we shifted gears and only extended taxpayer-funded contracts and subsidies to corporations that limited their CEO pay to no more than 25 or 50 times worker pay, top execs at companies that get our tax dollars would have an ever-present incentive to raise their worker pay, not squeeze it.
Two municipalities, Portland and San Francisco, have already taken steps in that direction. State and federal lawmakers have introduced similar proposals, as this Inequality.org CEO-Worker Pay Resource Guide details.
We clearly can create a more equal United States. Corporate paychecks could lead the way.
An Urgent Message From Our Co-Founder
Dear Common Dreams reader, It’s been nearly 30 years since I co-founded Common Dreams with my late wife, Lina Newhouser. We had the radical notion that journalism should serve the public good, not corporate profits. It was clear to us from the outset what it would take to build such a project. No paid advertisements. No corporate sponsors. No millionaire publisher telling us what to think or do. Many people said we wouldn't last a year, but we proved those doubters wrong. Together with a tremendous team of journalists and dedicated staff, we built an independent media outlet free from the constraints of profits and corporate control. Our mission has always been simple: To inform. To inspire. To ignite change for the common good. Building Common Dreams was not easy. Our survival was never guaranteed. When you take on the most powerful forces—Wall Street greed, fossil fuel industry destruction, Big Tech lobbyists, and uber-rich oligarchs who have spent billions upon billions rigging the economy and democracy in their favor—the only bulwark you have is supporters who believe in your work. But here’s the urgent message from me today. It's never been this bad out there. And it's never been this hard to keep us going. At the very moment Common Dreams is most needed, the threats we face are intensifying. We need your support now more than ever. We don't accept corporate advertising and never will. We don't have a paywall because we don't think people should be blocked from critical news based on their ability to pay. Everything we do is funded by the donations of readers like you. When everyone does the little they can afford, we are strong. But if that support retreats or dries up, so do we. Will you donate now to make sure Common Dreams not only survives but thrives? —Craig Brown, Co-founder |
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Sam Pizzigati
Sam Pizzigati, veteran labor journalist and Institute for Policy Studies associate fellow, edits Inequality.org. His recent books include: The Case for a Maximum Wage (2018) and The Rich Don't Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970 (2012).
Can you imagine a president of the United States proposing a federal budget that quadruples the paychecks that go to top federal officials? Of course not. No president would dare risk wandering down that road. America’s taxpayers, our top pols understand, have a distinct aversion to seeing anyone get rich off their tax dollars.
Pay rates for top executives within the federal government reflect that aversion. The U.S. Department of Health and Human Services has, for instance, over 80,000 employees, and the work these employees do can literally make the difference between life and death for millions of people the world over. Yet the top executive at HHS, Xavier Becerra, last year took home less than $250,000 in compensation.
Within Corporate America’s top executive suites, by contrast, $250,000 wouldn’t even rate as a decent paycheck for a mere week’s worth of labor. Last year’s highest-paid U.S. CEOs pocketed over $250,000 per day.
Should we care about these astounding sums now filling the pockets of our top corporate execs? We sure should. Unlike cabinet secretaries like Xavier Becerra, corporate execs are getting rich off our tax dollars. Large numbers of these execs are either running corporations with massive federal contracts or annually raking in fistfuls of federal subsidies.
Need some specifics? Consider the pharmaceutical industry and the race against Covid. Back in 2012, notes a just-published Fierce Pharma analysis, five biopharma CEOs pocketed over $18 million in annual compensation. Last year, biopharma’s 15 highest-paid execs all took home at least $19 million. Their ranks included the CEOs at the two most prominent Covid vaccine firms: Pfizer’s Albert Bourla and Moderna’s Stefane Bancel. In 2022, their paychecks together totaled over $52 million.
What did execs like these two CEOs do to reap their immense windfalls? They surfed a Covid wave of tax dollars. That wave enabled their personal “success.” Notes a Health Affairs journal analysis: “The government invested extensively in every aspect of the basic science, preclinical development, and clinical trials for the vaccines.” Tax dollars even “reduced manufacturing risk by underwriting capacity investments.”
Overall, as data from the People’s Vaccine Alliance would show, the “excessive profits” Big Pharma giants made off Covid vaccines created “at least” nine new billion-dollar fortunes in the pandemic’s first year alone.
We have, unfortunately, learned little in the way of lessons from our Covid experience. Our tax dollars, a new study from Good Jobs First indicates, are now turbocharging supersized climate-change fortunes.
The just-released Good Jobs First analysis — Power Outrage: Will Heavily Subsidized Battery Factories Generate Substandard Jobs? — examines a little-known provision in the 2022 Inflation Reduction Act that may end up costing U.S. taxpayers more than $200 billion over the next decade, a sum above and beyond the $13 billion that state and local governments have promised as battery incentives.
We clearly can create a more equal United States.
Lawmakers see all those billions of tax dollars as a generator of good wages, but nothing in the battery subsidy fine-print mandates — or even incentivizes — decent worker paychecks. Ford Motor, for instance, will be eligible for $6.7 billion in federal subsidies for its new $3.5-billion battery plant in Michigan, and state and local officials have already handed Ford $1.7 billion for that plant.
How does that math play out for real-life workers?
“The company has promised to create 2,500 new jobs that it says will pay an average annual wage of just $45,000 a year,” Good Jobs First points out, “while reaping subsidies of $3.4 million per job.”
The Good Jobs First study offers a variety of policy proposals “to set the country’s emerging EV-battery industrial complex on the path to ‘high road’ employment,” steps ranging from requiring subsidy recipients to pay wages that at least match the local market rate to including contract provisions that “claw back” tax-dollar subsidies should companies fail to deliver the jobs they’ve promised.
Will steps like these be enough to ensure that the benefits of the transition to electric vehicles get “justly shared,” as the Good Jobs First report puts it, “with the workers and communities building America’s fossil-free economy”? Not unless we also take steps that meaningfully discourage any attempts by top corporate execs to grab much more than their “fair share” of federal tax dollars.
How could we do that discouraging? We could include in every government contract and subsidy provisions that deny public tax dollars to firms that compensate their top execs at over 25 or 50 times the compensation that goes to their workers.
A bit of historical perspective: Back in the mid-20th century, few corporate chiefs pocketed over 20 times the annual compensation of their average workers. CEOs at major U.S. corporations, the Economic Policy Institute reported last fall, are now averaging nearly 400 times worker annual pay.
If we shifted gears and only extended taxpayer-funded contracts and subsidies to corporations that limited their CEO pay to no more than 25 or 50 times worker pay, top execs at companies that get our tax dollars would have an ever-present incentive to raise their worker pay, not squeeze it.
Two municipalities, Portland and San Francisco, have already taken steps in that direction. State and federal lawmakers have introduced similar proposals, as this Inequality.org CEO-Worker Pay Resource Guide details.
We clearly can create a more equal United States. Corporate paychecks could lead the way.
Sam Pizzigati
Sam Pizzigati, veteran labor journalist and Institute for Policy Studies associate fellow, edits Inequality.org. His recent books include: The Case for a Maximum Wage (2018) and The Rich Don't Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970 (2012).
Can you imagine a president of the United States proposing a federal budget that quadruples the paychecks that go to top federal officials? Of course not. No president would dare risk wandering down that road. America’s taxpayers, our top pols understand, have a distinct aversion to seeing anyone get rich off their tax dollars.
Pay rates for top executives within the federal government reflect that aversion. The U.S. Department of Health and Human Services has, for instance, over 80,000 employees, and the work these employees do can literally make the difference between life and death for millions of people the world over. Yet the top executive at HHS, Xavier Becerra, last year took home less than $250,000 in compensation.
Within Corporate America’s top executive suites, by contrast, $250,000 wouldn’t even rate as a decent paycheck for a mere week’s worth of labor. Last year’s highest-paid U.S. CEOs pocketed over $250,000 per day.
Should we care about these astounding sums now filling the pockets of our top corporate execs? We sure should. Unlike cabinet secretaries like Xavier Becerra, corporate execs are getting rich off our tax dollars. Large numbers of these execs are either running corporations with massive federal contracts or annually raking in fistfuls of federal subsidies.
Need some specifics? Consider the pharmaceutical industry and the race against Covid. Back in 2012, notes a just-published Fierce Pharma analysis, five biopharma CEOs pocketed over $18 million in annual compensation. Last year, biopharma’s 15 highest-paid execs all took home at least $19 million. Their ranks included the CEOs at the two most prominent Covid vaccine firms: Pfizer’s Albert Bourla and Moderna’s Stefane Bancel. In 2022, their paychecks together totaled over $52 million.
What did execs like these two CEOs do to reap their immense windfalls? They surfed a Covid wave of tax dollars. That wave enabled their personal “success.” Notes a Health Affairs journal analysis: “The government invested extensively in every aspect of the basic science, preclinical development, and clinical trials for the vaccines.” Tax dollars even “reduced manufacturing risk by underwriting capacity investments.”
Overall, as data from the People’s Vaccine Alliance would show, the “excessive profits” Big Pharma giants made off Covid vaccines created “at least” nine new billion-dollar fortunes in the pandemic’s first year alone.
We have, unfortunately, learned little in the way of lessons from our Covid experience. Our tax dollars, a new study from Good Jobs First indicates, are now turbocharging supersized climate-change fortunes.
The just-released Good Jobs First analysis — Power Outrage: Will Heavily Subsidized Battery Factories Generate Substandard Jobs? — examines a little-known provision in the 2022 Inflation Reduction Act that may end up costing U.S. taxpayers more than $200 billion over the next decade, a sum above and beyond the $13 billion that state and local governments have promised as battery incentives.
We clearly can create a more equal United States.
Lawmakers see all those billions of tax dollars as a generator of good wages, but nothing in the battery subsidy fine-print mandates — or even incentivizes — decent worker paychecks. Ford Motor, for instance, will be eligible for $6.7 billion in federal subsidies for its new $3.5-billion battery plant in Michigan, and state and local officials have already handed Ford $1.7 billion for that plant.
How does that math play out for real-life workers?
“The company has promised to create 2,500 new jobs that it says will pay an average annual wage of just $45,000 a year,” Good Jobs First points out, “while reaping subsidies of $3.4 million per job.”
The Good Jobs First study offers a variety of policy proposals “to set the country’s emerging EV-battery industrial complex on the path to ‘high road’ employment,” steps ranging from requiring subsidy recipients to pay wages that at least match the local market rate to including contract provisions that “claw back” tax-dollar subsidies should companies fail to deliver the jobs they’ve promised.
Will steps like these be enough to ensure that the benefits of the transition to electric vehicles get “justly shared,” as the Good Jobs First report puts it, “with the workers and communities building America’s fossil-free economy”? Not unless we also take steps that meaningfully discourage any attempts by top corporate execs to grab much more than their “fair share” of federal tax dollars.
How could we do that discouraging? We could include in every government contract and subsidy provisions that deny public tax dollars to firms that compensate their top execs at over 25 or 50 times the compensation that goes to their workers.
A bit of historical perspective: Back in the mid-20th century, few corporate chiefs pocketed over 20 times the annual compensation of their average workers. CEOs at major U.S. corporations, the Economic Policy Institute reported last fall, are now averaging nearly 400 times worker annual pay.
If we shifted gears and only extended taxpayer-funded contracts and subsidies to corporations that limited their CEO pay to no more than 25 or 50 times worker pay, top execs at companies that get our tax dollars would have an ever-present incentive to raise their worker pay, not squeeze it.
Two municipalities, Portland and San Francisco, have already taken steps in that direction. State and federal lawmakers have introduced similar proposals, as this Inequality.org CEO-Worker Pay Resource Guide details.
We clearly can create a more equal United States. Corporate paychecks could lead the way.
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