What I Do
Christy McGill, Art Teacher - Divide Elementary School, Lookout, WV.
Christy McGill, Art Teacher - Divide Elementary School, Lookout, WV.
Good morning and thank you for joining us.
The AFL-CIO is launching the 2013 Executive PayWatch website today to coincide with Tax Day, when working families are gathering around the country to highlight growing wealth inequality and call for a fair tax system.
Our latest data confirm what you have probably already guessed: American chief executives continued to do very well for themselves in 2012, while workers struggle to make ends meet.
The CEOs of S&P 500 Index companies received, on average, $12.3 million last year. Meanwhile, rank-and-file American workers took home just $34,645 in 2012. Not surprisingly, the pay gap between CEOs and workers remains high: CEOs made 354 times the typical worker in 2012.
CEO-to-worker pay disparities have increased dramatically over the past several decades. Thirty years ago, CEOs were paid 42 times that of rank-and-file workers in the U.S. This pay gap grew to 201 times in 1992. Ten years ago, the CEO-to-worker pay gap reached 281 to 1.
Not only is U.S. CEO pay out-of-whack with historical norms, but it is off the chart globally. For example, in Switzerland, where voters recently imposed new limits on executive pay, the gap is only about half as big as in America.
In the United Kingdom, the CEO-to-worker pay gap is one-quarter as large as ours. And in Japan, the gap is even smaller. Poland has the smallest pay gap out of all developed countries, where CEOs earn 28 times that of the average worker. In no other country is the ratio of CEO pay to typical worker pay even close to 354 times.
Now, you probably know as well as I do that American companies want to hide the hard numbers of CEO pay. But the public and investors need to know this information. We should be able to ask why CEOs continue to hurt the companies that employ them and the workers who produce the company’s value by taking such a large share of the earnings.
The Dodd-Frank Wall Street Reform and Consumer Protection Act requires companies to disclose their CEO-to-worker pay ratio. But these pay ratios continue to remain secret, in part because corporate lobbyists have delayed the Securities and Exchange Commission from implementing the law.
This is a big problem, and it’s hurting our economy, because regular working people are earning less and less. The flip-side of the larger incomes of the top 1 percent in the U.S. is the stagnant income of the 99 percent.
After the Wall Street financial crisis, between 2009 and 2011, income for the bottom 99 percent of households fell 0.4 percent, while the income of the top 1 percent grew by 11.2 percent.
Business groups like the Business Roundtable and Fix the Debt have been drumming up a deficit scare to distract attention from America’s real economic problems, and to hide their efforts to get even more tax cuts for corporations while hacking at Social Security, Medicare and Medicaid.
This year, with Executive Paywatch, working people are exposing the CEOs behind these efforts. We are revealing the ruinous tactics of the Wall Street CEOs, who always cry for more corporate tax cuts while squeezing the retirement security of working America.
The Campaign to Fix the Debt wants to overhaul the tax system so that corporate profits kept overseas are permanently exempt from U.S. taxes. Many of the companies whose CEOs are members of Fix the Debt have millions in corporate profits stashed offshore.
On Paywatch, you will find out just how much money these CEOs’ companies stand to gain. For example, Jeffrey Immelt, the CEO of General Electric, is a member of the Fix the Debt’s steering committee. His company has accumulated $108 billion in overseas profits that it is sheltering from U.S. taxes.
Meanwhile, the Business Roundtable, which represents the nation’s largest blue-chip companies, wants to increase the retirement age for collecting Social Security and Medicare to 70. The Business Roundtable also wants to cut the benefits by changing the way they are calculated.
On Paywatch, we have published the golden retirement nest eggs of the CEOs who make up the Business Roundtable’s executive committee. For example, David Cote, the CEO of Honeywell International, doesn’t have to worry about his retirement. He stands to collect a handsome $134.5 million in pension and other retirement benefits.
These CEOs should be ashamed for trying to balance the federal budget deficit on the backs of America’s working families, while at the same time they are demanding corporate tax cuts for overseas profits. The American public deserves to know the truth about their self-serving agenda.
Now I’d like to turn this over to Brandon Rees, acting director of the Office of Investment, to walk you through the new website.
Thank you.
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AFL-CIO Media Outreach Department 202-637-5018
Gonzalo Salvador , 202-637-5033
