Sunday, March 07, 2010

Executive Pay vs. Worker pay and the Tea Bagger movement

I took a look this morning at why so many Americans are mad and why this Tea Bagger's movement has gained such strong traction in light of the recent violence directed (or misdirected) at the government. In part some elected officials are responsible for where we find ourselves today, but it is simply amazing to me that the anger that is building, spawned by Republicans like Glenn Beck, Rush Limbaugh and the likes of these Republican Senators, Sen. Kyle, Sen. Jim DeMint, Sen. John Cornyn, Sen. Mitch McConnell, former Republican Congressmen Dick Armey and Minority leader John Boehner, is not placed where it should be. It should be aimed at the Republican Party and its leaders, as is shown in the chart above! (Click on the charts to enlarge them.)

From the chart above on EXECUTIVE COMPENSATION, from the NY TImes you can see the divide between Executive pay and average worker pay since 1940. It is very clear to me that around 1985 this trend skyrocketed upward. This was when Pres. Reagan had massive tax cuts for the wealthy and trickle down economics was touted as going to be a good thing for the Middle Class and the debt began to rise. It is my opinion, and I will get the facts on this, that it was the Financial sectors Executives which were primarily responsible for this move up coincidently with the invention of Credit Default Swaps and other derivative instruments created in those years. Both charts track very well.

It was also emboldened by Sen. Phil Gramm's legislation, called the Gramm–Leach–Bliley Act, to deregulate the Banking and Insurance Industry by getting rid of Glass-Steagall in 1999 tied to a bill to provide the funds to keep the government running, when Newt Gingrich threatened to shut down all government. The amendment passed in the middle of the night and was signed into law by President Clinton, who in my view didn't know what he was really signing and the implications, but that's another debate for a different time. Suffice to say he signed the legislation to prevent a government shutdown. The effect of this and those new financial instruments changed most significantly Executive compensation possibilities as the stock market had soared to over 10,000 and the Nasdaq to over 5,000.

So enough of the history and now focusing on the chart, the folks to be upset with are those who passed Banking and Insurance deregulation in the first place (Mostly Republicans with the assistance of Bill Clinton and weak Democrats and also Executives in the Financial Institutions and their Boards who approve these ridiculous levels of compensation. The Democrats should be knocking the heck out of Republicans with this issue as they have stood with the workers and trying to help them with programs such as Social Security and Medicare. But instead it is the Republicans who are getting the masses all worked up to "throw the bums out."

I agree with them on that point, but it is Republicans who should be thrown out, all of them, for creating this mess and being on the side of lobbyists on the healthcare debate and backing the Insurance company Executives from For-Profit companies. The Democrats have got to start to play hardball and reverse this inequity of pay for the middle class and help the poorest amongst us. I'll bet if you if you check donations made to Haiti for the earthquake which devastated the country, most were small donations and made by people who could little afford it compared to the salaries of those Executives. It is morally wrong and inhumane. The problem is the entitlement attitude of these people. They see nothing wrong with their compensation compared to the workers. They actually believe they deserve what they are stealing, and I use the word stealing deliberately. It's a crime and they have no shame or conscience. They want to pay off TARP quickly so they can get back to wealth accumulation. What do you think?

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Anonymous darkflux said...

news flash: ALL politicians suck. Demicraps and Retardlickin's alike. Medicare and other financial aide is being abused, and Social Security allowances are nearly run dry! what we need is someone who's not affiliated with either group, that wants happiness for ALL, and not just one group of belief systems. too bad you have to be 35 or older to be Pres., or i'd run (lol).

6:45 AM  
Blogger janeen67 said...

I want mine 1st and I want it all. I only care about you if you can help me get it. Otherwise all you whiney, bleeding heart liberals just shut up. You sniveling, do gooder, tree hugging, ass wipes who want to “share” my wealth with
people who are sick, jobless, underpaid, homeless, old, poor. Screw ‘em, I just want mine, don’t bother me.

6:54 AM  

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