Let’s look at what all the collective, depression-preventing action is accomplishing. In a word or two, it is protecting the insiders, like some of America’s top CEOs, at the expense of the outsiders. That is, it is doing what government always does. But it is doing it in a particularly galling way. Here’s the latest on what the insiders are up to, from the Guardian:
Revealed: huge increase in executive pay for America’s top bosses
Exclusive survey shows America’s CEOs enjoyed pay hikes of up to 40% last year — with one chief executive earning $145m
Chief executive pay has roared back after two years of stagnation and decline. America’s top bosses enjoyed pay hikes of between 27 and 40% last year, according to the largest survey of US CEO pay. The dramatic bounceback comes as the latest government figures show wages for the majority of Americans are failing to keep up with inflation.
America’s highest paid executive took home more than $145.2m, and as stock prices recovered across the board, the median value of bosses’ profits on stock options rose 70% in 2010, from $950,400 to $1.3m. The news comes against the backdrop of an Occupy Wall Street movement that has focused Washington’s attention on the pay packages of America’s highest paid.
Three of this year’s top 10 earners come from the healthcare industry. Top earner John Hammergren at McKesson, the world’s largest healthcare firm, made $145,266,91 last year — most of it from stock options.
2010 was a great year to lose your job as a CEO. Four of the 10 highest paid CEOs were retired or departing executives. Ronald Williams, former head of Aetna, a health insurer, exercised 2.4m options for a profit of $50.4m. Aetna’s stock price declined by 70% from when Williams assumed the role of CEO in February 2006 until his retirement. At pharmacy chain CVS, Thomas Ryan made a $28m profit on his options. During Ryan’s 13-year tenure as CEO, CVS Caremark’s stock price decreased almost 54%.
Omnicare’s Joel Gemunder retired last August and received cash severance of $16m, part of a final-year pay package worth $98.28m.
Interesting, no? Many of the top earners are in the zombie health care industry. It is a zombie industry because it is so heavily controlled, subsidized, and protected from competition by the zombie government.
In our way of seeing things, no CEO is worth $145 million. Or even $1 million, for that matter. But that’s what you get in a degenerate pseudo-capitalist system.
Meanwhile, the average working man — who has no clue about the whys of it — is getting pretty chuffed.
“$740 billion pay gap threat to US recovery” says The Financial Times. That amount is the money that would have gone to US working people if they had maintained their share of national income at post-war average.
The FT is scratching its head, trying to figure out how the economy can recover when the people who do the buying have so little money. According to its figures, the average worker would have $5,000 more this year alone, if wages were still at 63% of national income. Instead, they have sunk to only 58% of national income…with more going to the bosses and stockholders.
For his part, the working stiff is less concerned with what it means to the economy and more concerned with what it means to him:
“Like a lot of Americans, I’m pretty ticked off,” said an Occupy Wall Street protestor. “It’s not that there are rich people. It’s that the people with a lot of money over the past few decades have rigged the system so that there’s not a fair chance to anyone anymore.”
He’s right. The system is rigged. Probably not the way he thinks. But rigged nonetheless.
The feds rigged it. They turned America’s leading business sectors into zombie-controlled, value-destroying industries. They turned the nation’s money into an ersatz currency. And they pushed the country’s middle class households in debt holes they find it difficult to climb out of….
And then, when the whole degenerate system was ready to come crashing down…they bailed out the debt-mongers…and propped up the whole corrupt system with $29 trillion in money that didn’t belong to them.
A merry little economic depression would have been so much better.
for The Daily Reckoning Australia