Corporations don’t seem willing to take the CEO pay problem seriously on their own. It’s time for public policy to treat massive inequality as the problem that it is by taxing the gap between CEO and median worker pay.
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THIS WEEK
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Did you see my colleague Sarah Anderson on CNBC last week? Over a decade has passed since the recklessness fueled by runaway CEO pay helped crash the U.S. economy, she reminded viewers, but the same characters who justified that recklessness — and even benefited from it — are still appearing on our TV screens.
Corporations don’t seem willing to take the CEO pay problem seriously on their own. We need public policies — like hiking taxes on companies with wide CEO-worker pay gaps — that treat inequality as the danger to our social well-being it most definitely is. Much more on that this week.
Chuck Collins, for the Institute for Policy Studies Inequality.org team |
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INEQUALITY BY THE NUMBERS
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FACES ON THE FRONTLINES
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A Night Celebrating Environmental Rights Defenders
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| Each year, our Institute for Policy Studies honors a pair of groups doing some of the most pathbreaking work to advance human rights across the Americas. Last week, we celebrated two such groups working on the frontlines of environmental justice. Members of the Comité Municipal en Defensa de Bienes Comunes y Naturales del Municipio de Tocoa have risked detention to block access to the mines that pollute their drinking water. And the students of Zero Hour are fighting climate change – and the systems of oppression that intersect with its causes and impacts. We have more on both awardees this week. |
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WORDS OF WISDOM
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PETULANT PLUTOCRAT
OF THE WEEK
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America’s Wealthy: Ever Eager to Pay Their Taxes!
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| Why do many of the wealthiest people in America oppose a “wealth tax,” an annual levy on grand fortune? Could their distaste reflect a simple reluctance to pay their fair tax share? Oh no, JPMorganChase CEO Jamie Dimon recently told the Business Roundtable: “I know a lot of wealthy people who would be happy to pay more in taxes; they just think it’ll be wasted and be given to interest groups and stuff like that.” Could Dimon have in mind the interest group he knows best, Wall Street? In the 2008 financial crisis, federal bailouts kept the banking industry from imploding. JPMorgan alone, notes the ProPublica Bailout Tracker, collected $25 billion worth of federal largesse, an act of generosity that’s helped Dimon lock down a $1.5-billion personal fortune. Under the Elizabeth Warren wealth tax plan, Dimon would pay an annual 3 percent tax on that much net worth. Fortunes between $1 billion and $2.5 billion would face a 5 percent annual tax under the Bernie Sanders plan. |
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GREED AT A GLANCE
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TOO MUCH
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| The Key to Distributing Our Wealth More Equitably |
| The idea of taxing corporations with wide gaps between CEO and worker pay at higher rates than firms with modest pay divides is exciting activists all across the United States. But the idea also has critics in circles that normally lean progressive. These critics see the progressive income tax as the more appropriate antidote to CEO pay excess. High tax rates on high incomes, analysts who share this perspective point out, can dampen excessive executive pay. In the years after World War II, high rates did just that. But these rates could not be sustained. What lessons ought we take from our tax-the-rich history? Inequality.org co-editor Sam Pizzigati, author of The Case for a Maximum Wage, has more. |
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MUST READS
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This week on Inequality.org
Sarah Anderson, We’ve Waited Too Long for Corporations to Fix the CEO Pay Problem on Their Own. A decade after bonus-chasing executives like Angelo Mozilo crashed the economy, we need tax incentives to push companies to narrow the gaps between CEO and worker pay.
Brian Wakamo, California Takes On the NCAA, Allows College Athletes to Get Paid. A new law could change the culture of college sports, and upturn a model that lets coaches feast while players struggle to make ends meet.
Sarah Anderson and Sam Pizzigati, Paying the Boss 1,000 Times More Than a Worker Encourages Corporate Recklessness. At the city, state, and federal levels, momentum is building to tax corporations with extreme gaps between CEO and worker pay.
Elsewhere on the Web
Opheli Garcia Lawler, The ‘Forbes 400’ list is basically class warfare, Mic. A world without billionaires might not be a perfect world, but it would certainly be a better one.
Juvaria Jafri, The Code of Capital: How the Law Creates Wealth and Inequality, LSE Review of Books. How changes in the legal system since the 1980s have privileged intangibles like patents, copyrights, and trademarks and sped maldistributions of wealth in the process.
Christopher Ingraham, Capital in the 21st century (B.C., that is), Washington Post. A look at the archaeological evidence on inequality’s earliest days.
Eric Levitz, Harvard’s Affirmative Action for Rich Whites Exposes Myth of Meritocracy, New York. You don’t have to be white to give a large donation to Harvard, but you do need a lot of disposable income.
Jonathan Ruga and Scott Young, We are businessmen in the 1%. It's time to increase taxes on us, Guardian. Two financiers explain why. |
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A FINAL FIGURE
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CAREER OPPORTUNITIES
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Work with Inequality.org: The Institute for Policy Studies is hiring for three new positions on our Inequality team! We’re looking for an Inequality Policy Researcher and an Administrative Assistant and Events Coordinator to join our Boston office, as well as an Inequality Data Researcher to be based in Washington, D.C. You can read more about the positions and apply here.
Apply for the Atlantic Fellows for Social and Economic Equity: Are you a change-maker committed to fighting inequality? Do you want to learn from scholars, innovators, activists and social change organisations, and the latest academic research and expert insights on inequalities? The Atlantic Fellows are looking for applicants who are bold and ready to challenge power; who see the bigger picture of how inequalities are playing out; who are imaginative and daring in the way they envision solutions; who bring care and collaboration into their practice; who recognize the significance of lived experience of inequality and whose own lived experience informs their practice; who are not focused on advancing their careers, but are truly committed to changing the world through collective and collaborative approaches. The Atlantic Fellows for Social and Economic Equity programme is a funded fellowship based at the International Inequalities Institute at the London School of Economics and Political Science. Read more about the program and apply here. |
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