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executive compensation
Meet 100 CEOs Getting Filthy Rich at Their Workers’ Expense
This year’s edition of the annual Institute for Policy Studies Executive Excess report finds that CEOs of the 100 S&P 500 firms with the lowest median wages, a group we’ve dubbed the “Low-Wage 100,” have enjoyed skyrocketing pay over the past six years.
The Low-Wage 100
In 2024, average compensation for Low-Wage 100 top executives rose to $17.2 million, up 34.7% since 2019 (not adjusted for inflation). Global median worker pay at these firms stood at just $35,570, after increasing at a nominal rate of only 16.3% since 2019—significantly below the 22.6% US inflation rate. The Low-Wage 100 pay ratio increased 12.9% to 632 to 1 over the past half decade.
Buybacks Bonanza
Here’s yet another sign of the Low-Wage 100’s skewed priorities: Between 2019 and 2024 these firms spent a combined $644 billion on stock buybacks. This once-illegal financial maneuver artificially inflates the value of a company’s shares and, in the process, pumps up the value of CEOs’ stock-based compensation. Even the most inept executives can rake in vast fortunes through this scam.
Every dollar spent on buybacks represents a dollar not spent on workers. The tradeoffs can be downright staggering. At Lowe’s, for instance, every one of their 273,000 employees could’ve gotten an annual $28,456 bonus over the past six years with the money the retailer blew on stock buybacks. Lowe’s median worker pay in 2024: $30,606.
80% of workers said they view corporate CEOs as overpaid, and nearly 70% said they do not believe their own company’s CEO could do the job they do for even one week.
If McDonald’s had spent their buyback outlays on worker bonuses during this period, they could’ve given all their employees an extra $18,338 per year—more than that company’s median wage.
Siphoning resources from workers to make CEOs even richer is especially outrageous at a time when so many Americans are struggling with high costs for groceries, housing, and other essentials.
Stock buybacks also divert resources from capital investments vital to long-term growth, such as employee training or upgrading technology, equipment, and properties.
At 56 Low-Wage 100 companies, outlays for stock buybacks actually exceeded capital expenditures between 2019 and 2024. If we exclude Amazon, a CapEx outlier, the Low-Wage 100 as a whole spent considerably more on buybacks than on capital expenditures over this six-year period.
Extensive research has also shown that excessive CEO compensation is bad for business because extreme internal pay disparities undermine employee morale and boost turnover rates.
Solutions to Executive Excess
As poll after poll after poll has shown, Americans across the political spectrum are fed up with overpaid CEOs and want government action. In one rather amusing recent survey, 80% of workers said they view corporate CEOs as overpaid, and nearly 70% said they do not believe their own company’s CEO could do the job they do for even one week.
How could policymakers incentivize more equitable pay practices? Several bills in the US Congress and state legislatures would increase taxes on corporations with huge CEO-worker pay gaps. Polls suggest this would be enormously popular. In one survey of likely voters, 89% of Democrats, 77% of Independents, and 71% of Republicans said they’d like to see tax hikes on companies that pay their CEOs more than 50 times what they pay their median employees.
Congress could also increase the 1% excise tax on stock buybacks that went into effect in 2023. If that tax had been set at 4%, the Low-Wage 100 would have owed approximately $6.3 billion in additional federal taxes on their share repurchases during the past two years. That revenue would’ve been enough to cover the cost of 327,218 public housing units for two years.
Policymakers have ample tools for tackling the problem of runaway CEO pay. Now they just need to listen to their constituents and get the job done.
Sanders Report Exposes How Nonprofit Hospitals Exploit Tax Breaks, Fail Poor Patients
The report explains that "in return for the tax benefits, the federal government requires those hospitals to operate for the public benefit by providing a set of community benefits, which includes ensuring low-income individuals receive medical care for free or at significantly reduced rates—a practice known as 'charity care.'"
However, as Sanders stressed, "despite these massive tax breaks, most nonprofit hospitals are actually reducing the amount of charity care they provide to low-income families even as CEO pay is soaring."
"In recent years, nonprofit hospitals have provided less charity care even as these hospitals saw a steady increase in their revenues and operating profits."
The report—which takes aim at 16 of the largest nonprofit hospital systems in the country—found that such hospitals "spent only an estimated $16 billion on charity care in 2020, or about 57% of the value of their tax breaks in the same year," and "have made information about their charity care programs difficult to access, leaving many patients unaware that they may qualify for free or discounted care."
Meanwhile, "in 2021, the most recent year for which data is available for all of the 16 hospital chains, those companies' CEOs averaged more than $8 million in compensation and collectively made over $140 million," according to the publication. "CommonSpirit Health led the way, with a combined $32 million compensation package for the outgoing and incoming CEOs. In the same year, the company spent only 1.5% of its revenue on charity care."
Of the chains examined, the Methodist Hospital led the group in terms of percent of revenue spent on charity care, at 8.05%. However, the report also begins with a story from a patient at one of those hospitals:
In 2007, Carrie Barrett needed a heart catherization after experiencing chest pain and shortness of breath. She went to a Methodist Le Bonheur (Methodist) hospital in Memphis, Tennessee, and walked out with the needed procedure completed and a $12,019 bill for her medical stay. Ms. Barrett made less than $12 an hour and had no hope of paying back that bill. But the hospital not only refused to help Barrett afford her bill, it instead piled on interest and sent the bill to collections. By June 2019, Ms. Barrett owed over $33,000, nearly three times the original cost of the procedure and more than twice what she earned in a year.
Stories like Ms. Barrett's are far too common. But they are even more egregious when the hospital is a nonprofit that is required to be "organized and operated exclusively for charitable purposes."
"In recent years, nonprofit hospitals have provided less charity care even as these hospitals saw a steady increase in their revenues and operating profits," the report says. "One study found 86% of nonprofit hospitals spent less on charity care than they received in tax benefits between 2011 and 2018."
"Another recent study found that nonprofit hospitals increased their average operating profit by more than 36%, from about $43 million to almost $59 million, between 2012 and 2019," the document details. "In the same time period, the hospitals almost doubled the cash balances they held in reserve, from an average of about $133 million to more than $224 million."
As hospitals stash cash and line the pockets of executives, many patients are putting off care. The publication points out that "in 2022, about 1 in 7 Americans delayed or went without hospital services due to high costs," and that "those delays create much higher risks of more serious conditions, worse health outcomes, and higher costs for patients."
For those who initially go to the doctor, unpaid bills may prevent them from getting more care later, due to hospital policies. For example, Allina—which spent just 0.346% of its revenue on charity care—previously "blocked employees from scheduling future appointments for patients who had outstanding bills exceeding $4,500," according to the report.
"Even when patients entered into payment plans, Allina blocked them from making appointments until the entire debt was cleared. These practices result in patients being denied needed care, including children who could not receive the necessary medical forms to enroll in day care or school," the document adds. "Only after extensive reporting detailing Allina's practices did the hospital change its policies."
Current conditions are "absolutely unacceptable," declared Sanders.
"At a time when 85 million Americans are uninsured or underinsured, over 500,000 people go bankrupt because of medically related debt, and over 60,000 Americans die each year because they cannot afford to go to a doctor when they need to, nonprofit hospitals should be providing more charity care to those who desperately need it, not less," he argued. "And if they refuse to do so, they should lose their tax-exempt status."
The report calls on Congress and the Internal Revenue Service (IRS) to "hold nonprofit hospitals accountable for the benefits they reap and their moral obligation to serve as pillars of accessible healthcare in their communities," and offers some steps they both could take.
Federal lawmakers could ensure hospitals offer charity care at levels consistent with tax breaks, establish standards for financial assistance programs, and define the community engagement necessary to justify nonprofit status, the report says, while "the IRS could address the administrative gaps that allow nonprofit hospitals to benefit off of the people they are failing to help."
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