Even as American workers and families struggle with the lingering effects of the Great Recession — a recession spurred in large part by Wall Street malfeasance — the nation’s biggest banks have rebounded, as have the pay packages of their CEOs. For instance, JP Morgan Chase CEO Jamie Dimon received more than $20 million in compensation for 2010, while Morgan Stanley CEO James Gorman made more than $15 million.
But American workers saw their pay grow by a measly two percent last year. And this is nothing new. Between 2000 and 2009, American workers experienced a “lost decade,” with incomes falling nearly five percent. As Marie Diamond noted, “the lack of wage growth has made it difficult for average Americans to keep up with rising prices on everything from gas to food.” Big bank CEO’s, meanwhile, made an average of $19 million per year between 2001 and 2010, as Fortune’s Colin Barr showed today:
Over the past decade the too-big-to-fail banks have showered a staggering $1.15 billion in cash and stock on a changing cast of hard-charging if inept chief executives, according to regulatory filings. That works out to an average paycheck of $19 million a year – this in a decade in which the biggest banks ripped off everyone in sight on their way to very nearly turning the lights out on the U.S. economy.
It’s not only in the banking industry that CEO pay has come roaring back. In 2010, median CEO pay climbed 27 percent. Median CEO compensation last year was $9 million, the highest since 2007, while the average CEO bonus grew by nearly 20 percent. CEOs at America’s largest companies now earn 343 times more than the typical worker. In 1970, the average CEO earned 28 times as much as the typical worker.
This disparity is contributing towards America’s sky-high income inequality, which is currently the worst its been since the 1920s. Currently, the top one percent of households make nearly 25 percent of the total income in the country, after they made less than 10 percent in the 1970s. Between 1980 and 2005, “more than 80 percent of total increase in Americans’ income went to the top 1 percent.”