“Watchdog Or Lapdog”: Big Corporations And Wall Street Still Hiding CEO Pay Ratios
Corporations are obligated to disclose how much their CEOs earn compared to the average worker, thanks to Section 953(b) of the financial reforms of 2010 known as Dodd-Frank.
However, three years after that bill became law, some of the nation’s largest corporations are battling regulators to prevent such disclosure, according to Bloomberg.
“The fact that corporate executives wouldn’t want to display the number speaks volumes,” said Phil Angelides, who was the chairman of the Financial Crisis Inquiry Commission, which investigated the collapse that led to the Great Recession.
Angelides says that the attempt to block this provision is just one example of the “street-by-street, block-by-block fight” that corporations and Wall Street are waging against implementation of the modest reform package that passed only after it was weakened to garner Republican support in the Senate.
Groups including the American Insurance Association, Business Roundtable, National Investor Relations Institute, and the U.S. Chamber of Commerce have petitioned the Security and Exchange Commission (SEC), making the argument that “it is unclear how the pay ratio disclosure will be material for the reasonable investor when making investment decisions.” They claim that calculating such ratios is time consuming and almost impossible for multinational corporations.
Without obligated disclosure, there’s no clear way to assess CEO-to-worker ratio. In 2010, the Bureau of Labor Statistics reported large-company CEO compensation was 319 times the median worker’s pay. Currently the average multiple of CEOs to a typical worker is 204 — up 20 percent since 2009, according to statistics collected from workers’ compensation estimates.
Bloomberg‘s Elliot Blair Smith and Phil Kuntz point to Ron Johnson, the recently ousted CEO of J.C. Penney, who earned a whopping 1,795 times what a typical $8.30-an-hour JCP salesperson took home.
The AFL-CIO has been attempting to counter the corporate lobbying with an effort to make the SEC put in place what is already law.
“The impact of high levels of CEO pay on employee morale is particularly important in today’s weak economy, when workers are being asked to do more for less,” suggests an online petition it is circulating to pass on to the government regulators.
“Estimates by academics and trade-union groups put the number at 20-to-1 in the 1950s, rising to 42-to-1 in 1980 and 120-to-1 by 2000,” Smith and Kuntz write.
Even if corporations are forced to disclose how much their top executive is paid, there are a variety of ways for them to cloak compensation.
Still the Campaign for America’s future calls enforcing Section 953(b) a crucial test for new SEC chair Mary Jo White to find out if she’ll be a “watchdog or a lap dog for Wall Street.”
By: Jason Sattler, The National Memo, May 2, 2013
“A Word On Obamabot-ism”: The Republican Party Is A Radical Oppositionist Party
I don’t mind being called an Obamabot. I mean, I’ve written a few columns about the guy that were brutal, tougher than anything Dowd’s written, especially at the time of the debt ceiling fiasco. But I understand the game, and it doesn’t bother me.
I have something I wish to make crystal clear, however. If it seems to you (I mean you, pumpkinface!) that I’m always excusing Obama, you’re misreading me. I am instead seeking to cast blame where it properly belongs. And that is almost always the Republican Party. I’ve said all this a jillion times before, but it is simply not a mainstream political party in the traditional American sense. It is a radical oppositionalist faction, way beyond the normal American parameters both in terms of ideology and tactics. And that needs to be pointed out, unfortunately, again and again and again.
Just today, Pat Toomey said of the background-check bill:
“In the end it didn’t pass because we’re so politicized. There were some on my side who did not want to be seen helping the president do something he wanted to get done, just because the president wanted to do it.”
A helpful admission on his part, and a rare piece of Republican candor. But this is the case time after time after time. It’s not normal. It’s not–and I mean not remotely–“the same thing” the Democrats did under Bush. Today’s GOP is a complete historical outlier.
Yes, I’m sure there were many Democrats who didn’t want to hand Reagan or either Bush a political victory. But historically, that is one of a handful of legislative considerations, and not even the first. Probably more like the fourth, after votes and money and what’s right for the country. But today’s GOP has turned it into iron law. It is relentlessly destructive.
On the subject of Gitmo, which I wrote about yesterday: In normal America, when a presidential candidate says he wants to do X once in office and then wins the election by a significant margin, Congress usually does X. The opposition party always attaches strings and conditions and so forth, but they obey the will of the people. Democrats, enough of them, led by Tip O’Neill, put Reagan’s programs through. Same thing with Bush’s tax cuts. (Republicans did not grant Clinton the same courtesy, but as bad as they were then, they’re worse now.)
So in normal America, a deal would have been worked out whereby Gitmo would close. After all, remember, the Republican candidate in 2008 supported closing Gitmo too. It was the GOP’s position! And yet, once Obama as president wanted to do it, they killed it cold in 2009.
They have been blocking it ever since. Here’s a vote on the question of use of funds to transfer Gitmo detainees from last November, after Obama had been handily reelected. Every Republican present voted no. Every one.
That was on an amendment to the defense reauthorization. That passed, and Obama signed it. But he issued a statement to accompany the signing explaining that he was dead-set against the provisions I referred to in this morning’s post. Under the Constitution, of course, there is no line-item veto; a president either signs or vetoes an entire bill. This was a defense authorization, so he signed. But he made his position crystal clear. Here’s the letter for you to see.
I’m sure there’s more he could have done or could now be doing. But wouldn’t you get a little discouraged? Oh, fucking hell, he thinks to himself at 3 am. Yes, I want to keep this promise I made. But why should I bang my head against that particular wall again? If I’m for it, they’re against it. I won’t get one Republican vote.
He is, obviously, a flawed human being; aloof, a little superior, not especially warm (so it seems), and no, he doesn’t scare anybody. He has all of these flaws and more. Maybe a different human being could get Susan Collins or Rob Portman or Lamar Alexander to vote his way once in a while.
But I don’t really think so. Collins and Portman and Alexander and others are, I’m certain, a little ashamed of their party today, and of themselves. But they are afraid of the right-wing agitprop media and their hard-shell base (and of course the threat of a primary from the right). So they don’t have the guts to the right thing, and they likely never will.
So it’s not that I’m always straining to defend Obama, although I can understand how it ends up looking that way. I am trying to tell as many people as I can that this Republican Party is extreme and wholly against American norms and traditions. And I think any opinion writer who isn’t saying this over and over is, in ascending order of likelihood, lying, dense, or deceiving him or herself.
By: Michael Tomasky, The Daily Beast, May 1, 2013
“Managing Expectations”: How Conservatives Are Helping Obamacare
Yuval Levin, among other conservatives, has made an offer to liberals: Let’s delay the implementation of Obamacare for a year and make everybody better off:
Congressional Democrats surely want to avoid being blamed for a meltdown of American health care during a congressional election year, the people implementing this law at every level could certainly use the time, and Republicans believe that more time would not make Obamacare more popular but would allow them to further develop and articulate their alternatives (and allow another election to intervene earlier in the rollout process, making a replacement more plausible).
Liberals, wisely, are saying no. What’s funny about this conversation is that conservatives have been accidentally managing expectations for implementation: By harping constantly on what a disaster the rollout is going to be, they will make what actually happens look good by comparison.
Jonathan Cohn has a good piece in the New Republic arguing that implementation won’t be as bad as people are saying. This is his really important observation:
Notice that the worries about implementation chaos apply strictly to people who would otherwise be uninsured or at the mercy of the existing individual insurance market, in which plans are inconsistently priced, full of coverage holes, and of unpredictable reliability — and in which financial assistance for buying private coverage is not available at all. Even if it takes these people a while to get insurance, and even if finding that coverage is a maddening experience, they’re going to end up with something they don’t have now: Coverage that meets more of their needs and is available to them, with substantial financial assistance. Don’t forget: Today, people with pre-existing medical conditions frequently cannot get any coverage on the individual market.
This is something that has been lost in the discussion of Obamacare implementation difficulties:
Implementation won’t much affect the 78 percent of Americans currently covered through Medicaid, Medicare, or employer group health plans. It will make some people who currently buy individual coverage worse off. But only 5 percent of Americans get insurance through the individual market, which is already hugely dysfunctional. Three times as many Americans are currently uninsured, and they can only stand to gain from Obamacare implementation, even if it does not go smoothly.
For those 5 percent who buy individual coverage now, the new law will be a mixed bag. Some people will probably have frustrating bureaucratic experiences with the new exchanges that they didn’t have buying directly from insurers. And some people (particularly young and healthy people) will see their premiums go up. But others will see their premiums go down, either because they currently pay a lot because of age or health status, or because income-based premium subsidies will more than offset any premium increase.
There will also be people who lose group health coverage, when premium subsidies make it attractive for their employers to send them to shop in the exchanges. (Others will gain group coverage if employers decide it is better to offer it than to pay a penalty for uninsured workers.) But neither this effect nor any problems faced by people with existing individual insurance is likely to create a clamor for repeal that is any more effective than the din of the last three years.
That is because the most obvious way to fix the problem of those who have trouble in the health exchanges will be to fix the exchanges, not repeal them. Let’s say your employer dropped group coverage and you’re having trouble with the exchange. Will you want the whole law repealed in the hope that will lead your employer to reverse course and offer a group plan again? Or will you want the exchange fixed so you are guaranteed access to coverage?
Cohn looks back to Medicare Part D and the Children’s Health Insurance Program and argues that those programs got through their rocky implementations in large part because benefits obtained with bureaucratic difficulty are better than no benefits at all. He’s right, and this is why conservatives are “magnanimously” offering to delay implementation of Obamacare. They realize that once people have guaranteed access to health coverage, they won’t want to give it up, even if there are implementation problems.
The political landscape is already dire for those who still hope to repeal Obamacare, and they’re actually making their position worse by talking constantly about what a nightmare implementation is going to be. This fall, as the exchanges come on line, tens of millions of people are going to find they can get health coverage they never could before. They are likely to be quite happy about that, especially if they’ve been hearing for months in advance that it will be a mess.
By: Josh Barro, Bloomberg, April 29, 2013
“The Jan Brewer Cycle Of Death”: Turning The Gun-Buyback Model On Its Ear
I’m not an expert in gun buyback programs, but the basic idea seems pretty straightforward. In the hopes of getting more guns off the streets, there are organized events in which members of the public bring their firearms, and exchange them for cash. They’re usually publicly funded, though as Rachel noted on the show in March, some are privately financed.
But what matters is the point of the programs: removing guns from circulation. It’s possible Arizona Republicans find this confusing.
Arizona cities and counties that hold community gun buyback events will have to sell the surrendered weapons instead of destroying them under a bill Gov. Jan Brewer signed into law Monday.
The bill was championed by Republicans in the GOP-controlled Legislature who argued that municipalities were skirting a 2010 law that was tightened last year and requires police to sell seized weapons to federally licensed dealers. They argued that destroying property turned over to the government is a waste of taxpayer resources.
Hmm. Let’s say a local sheriff’s office in Arizona wants to reduce gun violence in its community by getting more guns off the streets. The sheriff decides to do this through a gun buyback program, encouraging local citizens to participate in exchange for money, helping to keep weapons out of the hands of children and criminals. The guns are then destroyed.
Under a new law championed by state Republicans, however, that sheriff’s office can’t destroy the guns — the firearms collected during the buyback will instead be brought to gun stores, where they then can be sold and put back on the streets.
The Arizona GOP wants to turn gun buyback programs into gun recycling programs — watch the assault rifle go from the street … to the police … to the gun dealers … back to the street.
Let’s all marvel at the cycle of life, or more accurately in this case, death.
By: Steve Benen, The Maddow Blog, April 30, 2013
“When Policy No Longer Has Value”: Pat Toomey’s Candor Sheds Light On The Post-Policy Republican Party
When Senate Republicans last week killed expanded background checks on firearms purchases, they were taking a political risk. After all, it was only four months after a massacre at an elementary school, and the bipartisan proposal enjoyed overwhelming support from the public. Some of the senators who supported the Republican filibuster are now paying a steep price.
So why did GOP senators put aside common sense and popular will? According to Sen. Pat Toomey (R-Pa.), who co-authored the bipartisan measure, it wasn’t just about the gun lobby — some of his Republican colleagues didn’t want to “be seen helping the president.”
“In the end it didn’t pass because we’re so politicized. There were some on my side who did not want to be seen helping the president do something he wanted to get done, just because the president wanted to do it,” Toomey admitted on Tuesday in an interview with Digital First Media editors in the offices of the Times Herald newspaper in Norristown, Pa.
Later, Toomey tried to walk that back a bit, saying he was referring not just to Senate Republicans, but also Republican voters, but I think in this case, Toomey’s original line was his honest assessment. Indeed, the clarification doesn’t even make sense — GOP voters “did not want to be seen helping the president”? C’mon.
I think the senator’s candor is important for a couple of key reasons. The first, of course, is that it puts the debate over gun reforms in a fresh light. You’ll recall that two weeks ago, much of the political commentary surrounding the Senate vote focused on holding President Obama responsible — he didn’t “twist arms” enough; he didn’t “lead” enough; he didn’t act like an Aaron Sorkin character enough. Blame the White House, we were told, for Republican intransigence.
According to Toomey — who presumably has a pretty good sense of the motivations of his own colleagues in his own party — the media’s blame game had it backwards. No amount of presidential arm-twisting can overcome the will of lawmakers who want to defeat the president’s agenda because it’s the president’s agenda.
The second angle to keep in mind is the post-policy thesis I’ve been harping on for weeks.
If you’re just joining us, Rachel used the phrase on the show two months ago, asking whether Republicans have become a “post-policy” party. This was the exchange between Rachel and Ezra Klein:
MADDOW: Does that mean that [Republican policymakers are] post-policy, that the policy actually — even some things that seem like constants don’t actually matter to them, that it’s pure politics, just positioning themselves vis-a-vis the president, and they’re not actually invested in any particular outcome for the country?
KLEIN: I would like to have an answer where that isn’t true. I really would.
In context, they were talking about budget issues, but note how well the thesis applies to just about every contemporary policy debate in Washington.
Indeed, according to Toomey, some Senate Republicans might have considered simple steps to prevent gun violence, but it was more important to them to play a partisan game — they were invested in pure politics, positioning themselves vis-a-vis the president, and the GOP was unconcerned with any particular outcome for the country.
This is unsustainable. The American system of government is dependent on a series of compromises — between the two parties, between the two chambers of Congress, between the executive and legislative branches — and governing breaks down when one party decides policy no longer has any value and there’s simply no need to consider concessions with those on the other side of the aisle.
By: Steve Benen, The Maddow Blog, May 1, 2013
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