OWS let the Gini out of the bottle (with a boost from T Party?)
Meritocracy vs. Plutocracy
As Barry has described it, “there is an unfocused financial rage in the United States” — and you see it in both the Tea Party and the OWS movement. Rather than mischaracterize why so many Americans — on the Left and the Right — are unhappy, let’s go to the actual data to see what is underlying this negative general sentiment.
Let’s start with the Gini Index, “the degree of inequality in the distribution of family income in a country.” Here’s our place in the world: [USA is in league with the dislikes of Mozambique and Uganda -- go read his post for details].
Well, How’d the Gini Index Get So Out of Whack?
In brief (footnotes removed):In recent decades, CEO pay has grown dramatically in the United States. Between the 1930s and the 1970s, CEOs of the largest companies received approximately $1 million in total annual compensation (adjusted for inflation in year 2000 dollars). During this period, the ratio of CEO-to-worker pay narrowed as workers’ wages grew and CEO pay rose modestly. By the 1990s CEO pay grew dramatically. Business Week estimated that CEO pay at the largest companies grew from 42 times the average worker’s pay in 1980 to 531 times the average worker’s pay in 2000. In 2010, large company CEOs received $11.4 million, or 343 times worker pay, according to calculations by the AFL-CIO’s Executive Paywatch website.A $1MM reduction in a CEO’s pay could be used to fund 13 jobs at $75k/year; nothing too complex about that math.
Meanwhile, while CEOs and other executives have feathered their nests — largely by exploiting overly-friendly relationships with all-too-compliant boards to negotiate outrageous compensation and severance packages — things have not been going quite as well for the rest of the country, as those at the top continue to rise while the remainder continue to drift
There is plenty of other data and commentary that follows, so be sure to click the link: Read the rest of this entry ».
Labels: Politics of wealth