Tuesday, June 28, 2011
Rep. Nan Hayworth, standing up for CEOs
House Republicans are supporting a lobbying effort by corporations to repeal new rules requiring the disclosure of executives’ salaries.
Publicizing the pay of corporate leaders, which was included in the Wall Street reform legislation adopted last year, is intended to show the disparity between the top and bottom of company payrolls—a comparison labeled as “useless” by GOP lawmakers.
But Democrats say the repeal is really about avoiding embarrassment on the part of CEOs and other top officials whose compensation has soared since the early 1990s, while the pay rates of rank-and-file workers have remained largely the same.
“The real reason House Republicans want to keep the typical worker’s pay secret is that it may embarrass some companies to reveal that they pay their CEO in the range of 400 times what they pay their typical worker,” Senator Robert Menendez (D-New Jersey) told The Washington Post.
Forty years ago, the average executive pay was 28 times that of the average worker. By 2005, the disparity had ballooned to 158 times.
More than 80 major companies are pushing to do away with the disclosure rules. The corporations include McDonald’s, Lowe’s, General Dynamics, American Airlines, IBM and General Mills.
The House Committee on Financial Services last week approved legislation, sponsored by Rep. Nan Hayworth (R-New York), containing the repeal. Of the 33 lawmakers voting in favor, 29 were Republicans and 4 were Democrats. Twenty-one Democrats opposed the measure.
Between 1970 and 2005, the average American worker’s wage, adjusted for inflation, increased 26%. During the same period, corporate profits went up 250% and the median executive income increased 430%.
-Noel Brinkerhoff
Business Group: Public Companies Shouldn’t Have to Compare CEO and Worker Pay (by Peter Whoriskey, Washington Post)
(Not) Spreading the Wealth (Washington Post)
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