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Executives receive one-third of all pay in the U.S.

By Pat Garofalo on Jul 21, 2009 at 9:45 pm

wsjcharteditAccording to a Wall Street Journal analysis of Social Security Administration data, more than one-third of all pay in the U.S. now goes to executives and other highly-paid employees:

Executives and other highly compensated employees now receive more than one-third of all pay in the U.S., according to a Wall Street Journal analysis of Social Security Administration data — without counting billions of dollars more in pay that remains off federal radar screens that measure wages and salaries. Highly paid employees received nearly $2.1 trillion of the $6.4 trillion in total U.S. pay in 2007, the latest figures available. The compensation numbers don’t include incentive stock options, unexercised stock options, unvested restricted stock units and certain benefits.

Between 1979 and 2006, the inflation-adjusted after-tax income of the richest 1 percent of households increased by 256 percent, compared to 21 percent for families in the middle income quintile. Despite these numbers, Democratic leaders, “bowing to unease among lawmakers and governors in their own party,” are reconsidering the House Ways and Means committee’s proposal to implement a surtax on the richest one percent of Americans as a way of financing a portion of health care reform. The Wonk Room has more.

Politics

Matthews To GOP Rep. Advancing ‘Birther’ Myth: ‘You Are Feeding The Wacko Wing Of Your Party’

By Ben Armbruster on Jul 21, 2009 at 7:30 pm

Over the past several months, the right wing has been advancing the discredited myth that President Obama is not a natural-born U.S. citizen. These so-called “birthers” claim that Obama hasn’t produced his a valid birth certificate to prove that he is eligible to be president. (He has). CNN’s Lou Dobbs is the latest to traffic in this nonsense, despite the fact that his own guest-host debunked the “birther” claims on Dobbs’s show.

Today on MSNBC, host Chris Matthews interviewed Rep. John Campbell (R-CA), co-sponsor of a bill that would require candidates for president in the future to present a copy of his or her birth certificate “to establish that the candidate meets the qualifications” for president. “The proposal is not crazy,” Campbell said in defense of the measure. “Congressman, nice try,” Matthews replied. “What you’re doing is appeasing the nutcases…you’re verifying the paranoia out there,” he said. Matthews then held up a copy of Obama’s birth certificate and said, “That’s the way to deal with this, mail this birth certificate to the wacko wing of your party.”

Matthews asked Campbell seven times if he believes Obama is a natural born U.S. citizen, and after a series of dodges, Matthews said, “You are feeding the wacko wing of your party.” Campbell finally answered, “As far as I know, Yes.” “As far as you know? I’m showing you his birth certificate!” Matthews exclaimed:

MATTHEWS: It’s on the screen now, take a close look. It says “Barack Hussein Obama.” He was born August 4, 1961 in Honolulu, is that a state? Yes it was. His mother was caucasian, his father was African. What more do you want? He’s male. He was born, by the way at 7:20 P.M. in the island of Oahu. What more do you want? I mean, I’m serious, you say “as far as you know?” You are playing to the crazies.

“Was he born in this country?” Matthews asked again. “Yes, I believe so,” Campbell replied. “Ok, finally we’re making progress,” Matthews said. Watch it:

Rep. Mike Castle (R-DE) was barraged by birthers at a local town hall meeting in Delaware recently and was forced to inform the crowd — much to their dismay — that Obama is indeed a natural born citizen.

Security

Beck: ‘Nothing Like Starting Your Week’ By Slamming Unions For Getting Rich Off ‘Illegals’

By Andrea Nill Sanchez on Jul 21, 2009 at 7:00 pm

Last night, Glenn Beck and guest Tim Phillips from Americans for Prosperity — one of the lead organizations behind the Tax Day Tea Party protests — kicked off the week by bashing the Employee Free Choice Act (EFCA) and attacking unions for wanting to represent undocumented workers. According to Beck and Phillips, unions don’t care about the American worker:

BECK: Anybody who says, hey the unions — they just love America–they do. They love America with all their little itty-bitty heart. And they love the American worker. And that’s all they’re trying to do — is help the American worker…Why would a union want to bring in illegals that are working below minimum wage, working in awful conditions? Why would they want to do that unless they were trying not to protect American jobs but just trying to get rich and have a whole bunch of new people signed up to be union members?

PHILLIPS: You hit it Glenn. They simply want more of the forced dues that come from new union members, regardless of their status — whether they’re here legally or not. They just want more money for their coffers to pursue their genuinely crazy liberal agenda.

BECK: …There’s nothing like starting your week just, ya know, going after the unions.

Watch it:

There are actually a lot of reasons why unions would want to organize immigrant workers who earn low wages working in miserable conditions — and they don’t include any sort of get-rich-quick scheme or “crazy liberal agenda.”

When immigrant workers are exploited, it drives down the wages, benefits, and working conditions of all workers in that industry. Cristina Jiménez, an immigration policy consultant at the Drum Major Institute for Public Policy has pointed out that “consigning undocumented workers to a precarious existence undermines all who aspire to a middle-class standard of living.” By organizing both immigrant and native-born workers, unions are better able to negotiate contracts that improve the standard of living for all of their members across the board.

Undocumented workers are extremely difficult to organize and EFCA would in fact make that job easier by strengthening penalties against companies that illegally coerce or intimidate workers to prevent them from forming a union. Increased union membership would help establish a secure workforce and lead to increased output and a more productive economy. Union workers earn 30% higher wages than their non-union counterparts and pay 8% less in health care deductibles. 72% receive retirement pension benefits compared to the 15% of non-union workers. EFCA is essentially a profit-making endeavor for the U.S. economy as a whole.

The most important thing that Beck misses is that it’s not the unions, but rather the unscrupulous employers who profit from hiring and exploiting undocumented immigrants that hurt American workers. It is not the union’s responsibility to verify the immigration status of a company’s employees, but it is a union’s duty to represent the interests of all of its members.

Climate Progress

Energy and Global Warming News for July 21st: American Meteorological Society endorses geoengineering research

By Climate Guest Blogger on Jul 21, 2009 at 6:55 pm

Geo-engineering remains at best a secondary climate strategy if you first do really aggressive CO2 reductions and keep concentrations below 450 ppm.  For now, as Obama’s science advisor put it [and reiterated to me this year], “The ‘geo-engineering’ approaches considered so far appear to be afflicted with some combination of high costs, low leverage, and a high likelihood of serious side effects.” At worst, geo-engineering is an utterly false hope that will undercut efforts to achieve the kind of emissions reductions needed for it to have any value.  That, of course, is why conservatives love it (see here).  Still, there is no reason not to do some research, as long as one is realistic….

Climate engineering research may get green light

Hacking the planet to rein in humanity’s effect on the climate has been given a scientific stamp of approval.

The umbrella body for meteorological scientists in the US is about to endorse research into geoengineering as part of a three-pronged approach to coping with climate change, alongside national policies to reduce emissions.

New Scientist has seen the final draft of the American Meteorological Society‘s carefully worded position paper on geoengineering. The AMS is the first major scientific body to officially endorse research into geoengineering.

The document states that “deliberately manipulating physical, chemical, or biological aspects of the Earth system” should be explored alongside the more conventional approaches to climate change. Conventional approaches means reducing emissions – “mitigation” in policy-speak – and adjusting to the unavoidable effect of climate change – known as “adaptation”….

Opponents of geoengineering may be reassured to find that the statement calls for studies into the social, ethical and legal implications of geoengineering solutions, and for methods to be developed in a transparent fashion.

Riding a Wave of Culture Change, DOD Strives to Trim Energy Demand

Read more

Security

Huckabee To Broadcast His Fox News Show From An Israeli Settlement

By Matt Duss on Jul 21, 2009 at 6:15 pm

hikind-huckabee1Israel’s Haaretz reports that “former U.S. presidential hopeful Mike Huckabee plans to broadcast his weekend show on Fox News” from a settlement construction site in East Jerusalem:

New York State Assemblyman Dov Hikind said Huckabee will air the talkshow during a solidarity visit to the site of the project, which is in the Palestinian neighborhood of Sheikh Jarrah.

Hikind, who is active in right-wing Jewish causes, told Haaretz that dozens of U.S. activists will participate in the mission, in order to express their support for the project and the man behind it, Irving Moskowitz.

Hikind is a former follower of Meir Kahane, a Jewish extremist who was assassinated in 1990. Two Kahanist organizations, Kach and Kahane Chai, are on the U.S. State Department’s list of Foreign Terrorist Organizations.

Irving Moskowitz is a Florida-based gambling magnate who funds right-wing pro-Israel organizations in the United States and radical Israeli settler groups and settlement projects in the occupied territories, like the one in Sheikh Jarrah. Moskowitz is also a longtime funder of conservative think tanks like the Hudson Institute, the American Enterprise Institute (AEI), the Jewish Institute for National Security Affairs, and the Center for Security Policy (CSP).

Huckabee has been an outspoken supporter of Israeli settlements — and opponent of a two-state solution. Last July, Huckabee told World Net Daily that “the two-state solution is no solution, but will cause only problems. … The Palestinians can create their homeland in many other places in the Middle East, outside Israel.”

Update

A source now tells me that Fox News has denied the Haaretz story, and that there are no plans to do ‘Huckabee’ from East Jerusalem.


Update

,Huckabee did end up traveling to Israel.

Yglesias

Endgame

By Matthew Yglesias on Jul 21, 2009 at 6:14 pm

Forgot to do one of these yesterday:

— Libertarians respond to progressive government by touting nutty alarmist books then cite “soaring sales” for nutty alarmist books to vindicate alarmism.

— Today in stilt analogies.

— Roundabout fever keeps on spreading.

— Crippling recession in Spain leads to surge of bank robberies.

— Greg Mankiw’s political commentary is deplorable.

— Why do doctors keep using Body Mass Index when it doesn’t measure anything useful?

Song of the day is the mashup the internet’s been waiting for, Nirvana vs Rick Astley “Never Gonna Give Your Teen Spirit Up”.

Politics

McCain refuses to endorse Steele’s charge that Obama’s health care plan is ‘socialism.’

By Ben Armbruster on Jul 21, 2009 at 5:40 pm

Yesterday during a confusing question-and-answer period after a speech at the National Press Club, RNC Chair Michael Steele was asked if he thought President Obama’s health care plan amounted to “socialism.” “Yes. Next question,” Steele quipped. Piling on the GOP’s new strategy to kill health care reform, Steele later added, “Slow down, Mr. President. We can’t afford to get health care wrong. Your experiment proposes too much, too soon, too fast.” This morning on CNN, host Kiren Chetry asked Sen. John McCain (R-AZ) if he agreed with Steele, but McCain — who hasn’t been shy to drop the S-bomb in relation to Obama — wouldn’t endorse the charge:

CHETRY: Yes, Michael Steele called it an experiment. He called it socialism, talking about the health care plan that’s out there right now in the House. Do you agree?

MCCAIN: I have my own opinions on most issues now, and I’ll be glad to give you my opinions, and I appreciate the opportunity to do so.

Watch it:

McCain isn’t the only GOP member of Congress Steele is having trouble convincing. When Rep. John Shadegg (R-AZ) was asked on MSNBC today if he agreed with Steele’s claim that Obama’s health care reform plan was “dangerous and reckless,” he woudn’t take the bait. “Well, those are pretty strong words,” he said, quickly changing the subject.

Economy

Executives Receive One-Third Of All Pay In The U.S., But Congress Is Still Afraid Of A Surtax

By Pat Garofalo on Jul 21, 2009 at 5:30 pm

The New York Times reported today that Democratic leaders, “bowing to unease among lawmakers and governors in their own party,” are reconsidering the House Ways and Means committee’s proposal to implement a surtax on the richest one percent of Americans as a way of financing a portion of health care reform.

wsjchartThere has indeed been a lot of pushback against the surtax proposal, which prompted Speaker of the House Nancy Pelosi (D-CA) to suggest that only households making more than $1 million should be subject to it, instead of the graduated scale starting at $350,000 that Ways and Means proposed.

But those feeling squeamish about the tax should take a look at this analysis in the Wall Street Journal, which shows how big a slice of the income pie the rich are currently receiving:

Executives and other highly compensated employees now receive more than one-third of all pay in the U.S., according to a Wall Street Journal analysis of Social Security Administration data — without counting billions of dollars more in pay that remains off federal radar screens that measure wages and salaries. Highly paid employees received nearly $2.1 trillion of the $6.4 trillion in total U.S. pay in 2007, the latest figures available. The compensation numbers don’t include incentive stock options, unexercised stock options, unvested restricted stock units and certain benefits.

In the five years ending in 2007, earnings for American workers rose 24 percent, while the highest-paid saw a 48 percent increase. So as Kevin Drum noted, “in other words, the executives got a 48% increase, the rest of us got approximately nothing, and it all averaged out to 24%.” And to top it all off, median pay raises for this year and next are set to be the lowest in decades.

incoemgrowthIncome growth in America for the last few decades has been overwhelmingly concentrated at the top. Between 1979 and 2006, the inflation-adjusted after-tax income of the richest 1 percent of households increased by 256 percent, compared to 21 percent for families in the middle income quintile. According to the Center on Budget and Policy Priorities, households in that richest one percent “had $617 billion more income in 2006 (or $656 billion more if measured in 2009 dollars) than they would have had if the 1979 income distribution still prevailed.”

Increasing taxes on this small percentage of people — who have done very well for a very long time — would raise revenue to put toward health reform, which is the single biggest problem for America’s bottom line. As Sen. Bernie Sanders (I-VT) said, “it certainly is okay for me to tell my friends on Wall Street, who just got a bonus of $600,000, they’re going to pay more in taxes so we can lower health care costs in America.”

Yglesias

Health Care and National Character

By Matthew Yglesias on Jul 21, 2009 at 5:28 pm

There’s really nothing I find more annoying that the lazy attribution of policy differences to vaguely defined “cultural” norms. For example, Jacob Weisberg writes that:

Health care systems are not just policy choices but expressions of national character and values. The alternatives he describes work better than ours not just because they’re well-designed and competently managed but because they reflect the expectations and traditions of their societies.

It’s hard to know how to test a proposition like that. But since Weisberg’s thoughts were inspired by T.R. Reid’s book, consider Reid’s explication of the three broad families of national health care systems.

— Beveridge: “Countries using the Beveridge plan or variations on it include its birthplace Great Britain, Spain, most of Scandinavia and New Zealand.”

— Bismark: “The Bismarck model is found in Germany, of course, and France, Belgium, the Netherlands, Japan, Switzerland, and, to a degree, in Latin America.”

— National Health Insurance: “The classic NHI system is found in Canada, but some newly industrialized countries — Taiwan and South Korea, for example — have also adopted the NHI model.”

Of course the United States of America is in a fourth category, applying the so-called “make everything terrible” model. Now the implication of the Weisberg Thesis is that the UK is more culturally aligned with Spain than it is with Canada. And that Canada is more aligned with South Korea than with the UK. And that the Netherlands has more in common with Japan than with Scandinavia. I don’t think that outside of the context of trying to make a cute point about health care, anyone would seriously try to argue in favor of any of those claims.

Yglesias

The Rich: Getting Richer

By Matthew Yglesias on Jul 21, 2009 at 5:27 pm

blog_wsj_executive_pay_2002_2007

You often hear the question of compensation for ordinary workers counterposed with the idea of profits. The reality, however, is that the total share of GDP that goes to workforce compensation remains eerily steady in the 56-59 percent range year after year.

What does change is what Kevin Drum points to, the share of compensation going to executives. In particular, pay is becoming more concentrated in the hands of the top managers. The rich, in other words, are getting richer. Exactly why this is happening is a matter of some dispute. The general timing of the explosion in CEO pay is, somewhat paradoxically, coincident with a revolution in corporate governance (“shareholder value”) that on paper should have reduced the ability of managers to self-deal.

But whatever the reason, that’s the trend. And it means that additional taxes on rich people, whether in the form of a surtax, in the form of curbing itemized deductions, or in the form of modifying the tax exempt status of employer-provided health benefits would be an appropriate countermove. That’s where the lion’s share of the wealth generated recently has wound up, so it’s a reasonable place to go hunting for revenue.

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