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Entries tagged "CEO Pay"

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Both California Senate Candidates Use IPS Reports to Slam Each Other

September 21, 2010 ·

In an election year in which voters are concerned with the record high unemployment numbers and the lack of a robust economic recovery, candidates around the country are using all they can to taint their opposing candidates’ economic records.

In California’s heated Senate race, both incumbent Senator Barbara Boxer (D) and Republican challenger Carly Fiorina have used Executive Excess reports to attack one another. The Institute for Policy Studies has published these annual reports on CEO pay for 17 years.

Friends of Barbara Boxer has cited our Executive Excess 2003 report in the attack ad below:

As the advertisement points out, we found that Fiorina laid off 25,700 workers in 2001, and then saw her pay jump 231 percent, from $1.2 million in 2001 to $4.1 million in 2002. Whereas previous HP heads had strived to avoid layoffs, IPS pay analyst Sarah Anderson described Fiorina as “like the Annie Oakley of the corporate world, coming in with her guns blazing.” Whether the layoffs directly led to her salary jump is unclear. However, it is obvious that Fiorina was a CEO that has put her own interests before her employees’ wellbeing, whether she would continue that management style if she becomes an U.S. Senator is something that no one can say for sure.

Fiorina, on the other hand, has cited our 2010 Executive Excess Report, CEOs and the Great Recession, on her website. She makes the claim that Senator Boxer has received thousands of dollars in campaign contributions from Bank of America, Verizon, Pfizer, Johnson & Johnson, Boeing and Microsoft—companies that have outsourced jobs and laid off workers since the beginning of our current economic recession.

Assuming that the website has correctly cited The Center for Responsive Politics, it is true that these companies that are funding Boxer’s campaign are among the top 50 “layoff leaders” in this recession. From this, you could argue that Boxer supports and is being supported by corporations that have laid off workers and have shipped workers overseas.

But unlike Fiorina during her axe-wielding days at HP, Boxer wasn’t the one directly responsible for mass layoffs.  Moreover, if you look at Boxer’s legislative record, the claim that she doesn’t support “Made in America” jobs creation is dubious. For one thing, she did support the $787 billion Recovery Act that has significantly helped lower the unemployment rate in the United States. So is Senator Boxer really a candidate that doesn’t believe in domestic job creation? It is hard to say…what do you think?

One thing we do know for sure is this: Job creation and reining in corporate executive excess are two very important issues that voters care about, which is evident from the heavy circulation and citation of our Executive Excess reports in one of the most heated electoral battles during the 2010 midterms. We are glad that both senatorial candidates are concerned with these issues. We just hope that whoever wins the election will take a look at our legislative score card at the end of our 2010 report (it starts on page 13) and actually start championing some of the legislative proposals that would rein in executive corporate excess.

CEO Pay and the Great Recession

September 1, 2010 ·

Baron with checkOver 15 million workers were fired from their jobs from January 2007 through December 2009, according to the Bureau of Labor Statistics.

Keep that in mind while looking at these numbers from IPS’s just-released 17th annual Executive Excess Report, CEO Pay and the Great Recession:

  • Fred Hassan, the ex-CEO of Schering-Plough, received a $33 million golden parachute when his firm merged with Merck in late 2009. The merger led to 16,000 workers being fired.
  • William Weldon of Johnson & Johnson took home $25.6 million, more than three times as much as the S&P 500 CEO average, at a time when his firm slashed 9,000 jobs and while the company was facing a massive drug recall scandal.
  • Mark Hurd of Hewlett-Packard, currently famous for failing to cover up a relationship with a contractor/erotic film star, has been awarded $24.2 million for laying off 6,400 workers. On top of that, he received an additional $28 million in severance.

These two sets of data illustrate a pretty dire picture, especially at a time when we are experiencing record unemployment. Both the government and the private sector are unwilling to take sufficient measures to put Americans back to work. The federal government is moving away from job-creating stimulus to supposedly austere measures, like cutting much needed social safety net programs (see here for an obvious example). The private sector, on the other hand, is making record short-term profits by eliminating jobs—furthering the income gap between the rich and the poor, while also significantly decreasing the consumption and taxpaying power of regular workers.

CEO Pay and the Great Recession is a report we released today that illustrates this irresponsible behavior in the corporate sector. According to the report, the 50 top CEOs that have laid off the most workers in 2009 received $12 million on average, while the S&P 500 companies have earned around $8.5 million on average.

Some additional key findings:

  • Five of the 50 top layoff leaders were recipients of major financial bailouts. Of these, American Express CEO Kenneth Chenault took home the highest 2009 pay, $16.8 million, including a $5 million cash bonus. American Express has laid off 4,000 employees since receiving $3.4 billion in taxpayer bailout funds.
  • The $598 million combined compensation of the top 50 CEO layoff leaders could provide average unemployment benefits to 37,759 workers for an entire year — or nearly a month of benefits for each of the 531,363 workers their companies laid off.

At a time when we're experiencing the worst economic crisis in the past 80 years, CEOs who slash jobs should have to tighten their own belts, not just so they’re in line with today’s S&P norm, but moving towards CEO pay levels in previous decades when the U.S. economy was more stable. This is a move that is necessary to establish robust sustainable economic growth. It would also help prevent future economic crises like the one we are experiencing today.

From the Frontlines: June 21, 2010

June 21, 2010 ·

Oil spill cleanup in the Niger Delta"Conservatives have declared a new class war, but it's not on bankers earning seven-figure bonuses," even though "[a] recent study [finds] that when such factors as education and work experience are accounted for, state and local employees earn 11 to 12 percent less than comparable private sector workers…By attacking public workers, they can demonize "big labor" and "big government" at the same time, while deflecting attention from the more logical target of Middle America's rage: the irresponsible Wall Street traders, whose risky, high-profit business practices brought down the economy, and the lax regulators who let them get away with it." (The Nation) If GOP senators are saying this, maybe they should volunteer to have their salaries cut first?

"It's as if the Earth has been smoking two packs a day," say the authors of a new Australian report on the decline of our oceans. (Scientific American)

The Guardian interviews Story of Stuff's Annie Leonard (with whom we collaborated on the Story of Cap and Trade) on her new book:"If you're going to vote with your dollar that's fine," Leonard says. "But you need to remember that Exxon has a lot more dollars than you. We need to vote with our votes; re-engage with the political process and change the balance of power so that those who are looking out for the wellbeing of the planet dominate, instead of those who are just looking out for the bottom line."

Anger at the BP oil disaster is turning into action. Yes! Magazine shows how. (You could also take a page from Rep. Barton's book and apologize to BP. Via OpenLeft.)

But if you think the situation in the Gulf is bad, take a look at the Niger Delta. By IPS board member Ethelbert Miller, in the FPIF Focal Points blog. You can also go to Niger Delta Rising for more background.

Unemployed? Laid off and left out? The National Employment Law Project wants to hear your story, because America's workers deserve better.

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