Jim Stillman
NevarRewards to the arrogant and selfish
April 23rd 2011 10:11
Sharing the sacrifice? Where is the anger?
Over the past several years, employees at Gannett Corporation were told of substantial and continued layoffs, unpaid furloughs and reductions in salary and benefits. All of these were, they were told, necessary for the company to continue in business, much less flourish. A matter of survival. The austerity did not extend to the top two executives at Gannett.
Last month, the company announced that it paid Chairman and CEO Craig Dubow $9.4 million last year -- double his 2009 pay -- as the company laid off hundreds of workers and imposed wage cuts on thousands more. His pay included a $1.75 million all-cash bonus. COO Gracia Martore got $8.2 million, more than double her $4.0 million in 2009, according to a report filed with federal regulators. Her pay included a cash bonus of $1.25 million. The report credited the duo with orchestrating the layoffs, unpaid furloughs and slashing of salaries and benefits.
The events at Gannett are not that unusual. More and more, rank and file employees are sacrificed so the top of the corporate food chain can have caviar and foie cras.
To its credit, Gannett’s USA Today published an exhaustive analysis of a report on Executive Compensation in companies that had ordered substantial layoffs in the very recent past. A few of the most egregious examples of tossing workers to the wolves and profiting mightily as a result:
Ivan Seidenberg of Verizon pulled in $17 Million in salary, bonuses and stock options, a 5.2% raise from last year, after laying off 21,000 people. United Technologies rewarded its CEO, Louis Chenevert, a 9% pay raise to $19.5 Million, after announcing layoffs of almost 14,000. The Walt Disney organization was quick to pare workers at its theme parks, thus allowing Robert Iger a 29.8% increase in total compensation to $28 Million! The “king” of CEO’s who earned major increases following layoffs is Fred Hassan of Schering-Plough. Mr. Hassan was given a raise to $47 Million per year following scrapping over 16,000 low level jobs.
Samuel Palmisano of IBM managed to be given a 19% raise to $25.1 Million, partially on the success he had in laying off nearly 8,000 lesser paid employees while Michael Duke who has guided Walmart and was rewarded with a compensation package of $19.3 Million after getting rid of more than 13,300 rank and file people. Mr. Duke is likely over income for Food Stamps, not so for the thousands sacrificed at the altar of corporate greed.\
At a time when most employees can barely remember their last substantial raise, median CEO pay jumped 27% in 2010 as the executives’ compensation started working its way back to prerecession levels. According to the U. S. Department of Labor, average compensation, outside of the executive suite, in the private sector increased by less than 2%
.
The Institute for Policy Studies reports the CEOs who fired the most workers during the current economic recession also rewarded themselves with the highest pay. Top managers at the fifty corporations with the greatest number of layoffs were paid an average of $12 million in salary, bonuses and other perks -- 42 percent more than the average for the Standard & Poor's 500. To make matters worse, at about three quarters of those companies, layoffs were announced at a time when earnings were increasing. Isn't it comforting to know that while you and I are experiencing the worst economy we've seen in our life-times, with jobless claims rising to 500,000, the CEOs are thriving? They are purchasing luxury cars, yachts, new homes, and even buying off foreclosed properties at fire-sale prices. Perhaps we should sleep better at night knowing that they are working so hard to offset their ruthless firings of employees by trying to revive the Rolls Royce dealerships and mortgage companies!
Where is the outrage?
GOP leaders, in Congress and, more significantly, in state capitals, have sold whatever souls may remain to the corporate interests who bankroll their election efforts. Governor Rick Scott, in Florida (“Vote for me; I was never indicted.) is a prime example of reverse Robin Hood. Stick it to the poor, Reduce accessibility to affordable health clinics. Cut school budgets. Reduce public safety outlays. But, lower corporate taxes and, by all means, don’t impose taxes on the corporate chieftains.\
I can understand the venality of some elected officials; I cannot understand how so many of us accept it.
Over the past several years, employees at Gannett Corporation were told of substantial and continued layoffs, unpaid furloughs and reductions in salary and benefits. All of these were, they were told, necessary for the company to continue in business, much less flourish. A matter of survival. The austerity did not extend to the top two executives at Gannett.
Last month, the company announced that it paid Chairman and CEO Craig Dubow $9.4 million last year -- double his 2009 pay -- as the company laid off hundreds of workers and imposed wage cuts on thousands more. His pay included a $1.75 million all-cash bonus. COO Gracia Martore got $8.2 million, more than double her $4.0 million in 2009, according to a report filed with federal regulators. Her pay included a cash bonus of $1.25 million. The report credited the duo with orchestrating the layoffs, unpaid furloughs and slashing of salaries and benefits.
The events at Gannett are not that unusual. More and more, rank and file employees are sacrificed so the top of the corporate food chain can have caviar and foie cras.
To its credit, Gannett’s USA Today published an exhaustive analysis of a report on Executive Compensation in companies that had ordered substantial layoffs in the very recent past. A few of the most egregious examples of tossing workers to the wolves and profiting mightily as a result:
Ivan Seidenberg of Verizon pulled in $17 Million in salary, bonuses and stock options, a 5.2% raise from last year, after laying off 21,000 people. United Technologies rewarded its CEO, Louis Chenevert, a 9% pay raise to $19.5 Million, after announcing layoffs of almost 14,000. The Walt Disney organization was quick to pare workers at its theme parks, thus allowing Robert Iger a 29.8% increase in total compensation to $28 Million! The “king” of CEO’s who earned major increases following layoffs is Fred Hassan of Schering-Plough. Mr. Hassan was given a raise to $47 Million per year following scrapping over 16,000 low level jobs.
Samuel Palmisano of IBM managed to be given a 19% raise to $25.1 Million, partially on the success he had in laying off nearly 8,000 lesser paid employees while Michael Duke who has guided Walmart and was rewarded with a compensation package of $19.3 Million after getting rid of more than 13,300 rank and file people. Mr. Duke is likely over income for Food Stamps, not so for the thousands sacrificed at the altar of corporate greed.\
At a time when most employees can barely remember their last substantial raise, median CEO pay jumped 27% in 2010 as the executives’ compensation started working its way back to prerecession levels. According to the U. S. Department of Labor, average compensation, outside of the executive suite, in the private sector increased by less than 2%
.
The Institute for Policy Studies reports the CEOs who fired the most workers during the current economic recession also rewarded themselves with the highest pay. Top managers at the fifty corporations with the greatest number of layoffs were paid an average of $12 million in salary, bonuses and other perks -- 42 percent more than the average for the Standard & Poor's 500. To make matters worse, at about three quarters of those companies, layoffs were announced at a time when earnings were increasing. Isn't it comforting to know that while you and I are experiencing the worst economy we've seen in our life-times, with jobless claims rising to 500,000, the CEOs are thriving? They are purchasing luxury cars, yachts, new homes, and even buying off foreclosed properties at fire-sale prices. Perhaps we should sleep better at night knowing that they are working so hard to offset their ruthless firings of employees by trying to revive the Rolls Royce dealerships and mortgage companies!
Where is the outrage?
GOP leaders, in Congress and, more significantly, in state capitals, have sold whatever souls may remain to the corporate interests who bankroll their election efforts. Governor Rick Scott, in Florida (“Vote for me; I was never indicted.) is a prime example of reverse Robin Hood. Stick it to the poor, Reduce accessibility to affordable health clinics. Cut school budgets. Reduce public safety outlays. But, lower corporate taxes and, by all means, don’t impose taxes on the corporate chieftains.\
I can understand the venality of some elected officials; I cannot understand how so many of us accept it.
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Comment by RickB_GA
Random thoughts … same subject … we agree, well, sorta, but from a different perspective.
1. Management has the obligation to use only the work force to do the task at hand. It is not Corporate America’s job to keep people on the payroll just because times are hard. Right now I consider times at least difficult for many people, I know they are for me. If management can maintain needed production with a smaller work force then so be it. If I were management at this point in time and I found I could reduce costs and still maintain product sufficient to meet demand I would use those savings to reduce pricing to the consumer, hopefully driving up demand and maybe leading to reemploying some of those folks recently sent packing. I would not add to the number of rubber ducks in the CEO’s swimming pool. Maybe that is why I am not Management.
2. Individual income above a maximum level (arbitrarily $500,000/year) would have to be paid by businesses as an after tax expense. It would have to be paid out of the pockets of shareholders/owners and it would not be subsidized by the tax payer nor would it not be tax deductible to the individual owner/shareholder; it would be a gift. This could be monitored by the IRS and would even include professional athletes and entertainers. I do not think this would reduce the incentive to invest because investing makes you an owner/shareholder. Who knows, it might even encourage more smaller investors if they felt their money was not going to end up as the new rubber duck in some CEO’s swimming pool. But then, I also think you could put all the ethics on Wall Street in a one gallon pail, with room to spare.
3. I do not think the sellout finger can be pointed at the Republicans alone. Eventually I think we are going to find out both parties are in the pockets of big business and Wall Street. Don’t forget, the Democrats (Obama, Pelosi and Reid) perpetrated the biggest fraud in history on the American Taxpayer under the guise of ObamaCare just about a year ago. At the rate we are going we are returning to a society of hunters and gatherers and will get there sooner than later if we do not stop borrowing and spending.
Good to see you writing again Jim … and I have not changed my mind, anybody but Obama in 2012 . . . . . . . A N Y B O D Y! And the two best investments today are still can goods and ammunition.