The $16.5 trillion national debt does not strike AFL-CIO
president Richard Trumka as the country's leading economic problem.
Income inequality tops the list for the labor union leader and
confidante of President Obama. Trumka said the deficit hawks in
corporate America are trying to "scare" voters and "distract
attention from America's real economic problems."
The AFL-CIO released Monday its 2012 "Paywatch" survey of the
compensation of 350 CEOs with companies in the
Standard & Poor's 500
(INDEXSP:.INX) index. Their compensation averaged $12.3 million
last year, 354 times more than what a typical American earns
according to the
Bureau of Labor Statistics
. But the union's political push has yet to make a serious dent in
the decades-long trend. Organized labor finds itself playing
defense - less than two years after the Occupy Wall Street movement
drew attention to the issue.
Stagnant wages have a disturbing ripple across the economy. As
incomes barely change for much of the country, more and more
Americans must either take on debt, save less, or downgrade their
lifestyle - all of which becomes an impediment to economic growth.
The AFL-CIO has yet to succeed in pushing the Securities and
Exchange Commission to implement a requirement from the 2010
Dodd-Frank law that companies disclose their own CEO-to-employee
ratios in filings.
Trumka blamed intense corporate lobbying against the rule, but he
said that wasn't "100 percent" of the reason for the delay. The
AFL-CIO is hoping the confirmation of Mary Jo White as the new SEC
end the stalemate
Some corporate representatives argue that the requirement would add
millions of dollars in new compliance costs. Trumka noted that he
faces more public scrutiny than these executives, saying, "Since
1959, labor leaders have had to disclose everything that they get."
The AFL-CIO also has a White House that submitted a 2014 budget
with a less generous cost-of-living adjustment for Social Security
recipients and cuts to Medicare, two policies meant to reduce the
deficit that the union staunchly opposes for their impact on
middle class retirees
"I talked to him before the budget was released," Trumka said about
his conversation with the president. "I told him why we thought it
was bad policy and why we thought it was a bad strategy. He
obviously chose not to follow the wisdom that I tried to impart."
Shareholders can hold say-on-pay-votes to express their displeasure
with CEO compensation. But even when the majority oppose a generous
package, the vote is merely symbolic, Trumka noted.
The CEO pay ratio was higher in 2011 than last year at 380 times an
average salary, but that figure was distorted by
) CEO Tim Cook's $378 million pay package and on the whole CEO
salaries continue to outpace wages nationwide. It's a somewhat
crude metric, since the AFL-CIO can only compare the CEO pay
packages with the salaries tracked by the Labor Department. But it
does reflect a growing chasm, since the ratio was 42-to-1 in 1982.
This year's edition of Paywatch specifically targeted the CEOs who
are part of the Business Roundtable and the Campaign to Fix the
The AFL-CIO looked at the retirement benefits of CEOs on the board
of the Business Roundtable, which favors increasing the retirement
age to 70 and realizing savings by the use of chained CPI to
measure inflation for Social Security recipients.
Trumka singled out
) Chairman and CEO David Cote, a member of the Business Roundtable
with a retirement package worth more than $134 million that begins
at the age of 60. "The hypocrisy never ceases to amaze me," Trumka
The union also attacked the non-partisan Campaign to Fix the Debt,
a project that receives funding from Pete Peterson, who also owns
The Fiscal Times. Among the recommendations from members of the
Campaign to Fix the Debt would be a move to a territorial tax
system where companies would not pay US taxes on foreign profits.
In January, John Engler, president of the Business Roundtable, a
CEO lobbying group, said that President Obama was open to
considering a new territorial tax system in order to encourage
companies to bring trillions of dollars back to the US that are
being sheltered abroad. Most foreign companies pay no US taxes on
Editor's Note: This article by Josh Boak originally appeared on
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