tagged w/ executive compensation
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Members of the 99% Power coalition disrupted Verizon's annual shareholder meeting in Huntsville, Ala., six separate times today. In each instance, a group of protesters interrupted the proceedings using “Mic Check” tactics, followed by chants such as “Shame on you!” “Verigreedy!” and “People over profit!” After each occurrence, the chanting group was led out by security people, with many in the audience applauding them. There were no arrests.
The Verizon shareholder meeting comes as the corporation is in negotiations with the Communications Workers of America (CWA) and the Electrical Workers (IBEW). The corporation—which made $100 billion in profits last year—is asking its workers for givebacks amounting to as much as $20,000 per worker, while tripling the compensation of its CEO, Lowell McAdam, from $7.2 million to $23.1 million. Verizon is the 16th largest corporation in America and made $22.5 billion in profits over the past four years, while paying its top five executives $283 million during that period, giving the company the nickname “Verigreedy." As Patrick Welsh, a Verizon retiree, said today, Verizon has broken the promises made that if you work hard, follow the rules and pay your taxes, then you’ll have a good retirement.
At a rally before the shareholder meeting, Alabama AFL-CIO President Al Henley demanded that Verizon be a better corporate citizen.
Verizon is on the run from their own workers, and thought that by taking the meeting to Alabama, a “right-to-work” state, but they misjudged our sense of solidarity here in the South.
Speaking to the thousands rallying outside the Verizon shareholder meeting, Ron Collins, CWA chief of staff, said, "Enough of the attacks on middle-class jobs while paying executives obscene salaries and dodging taxes.”
Also at the rally, Scott Douglas, executive director of the Greater Birmingham Ministries, said, “We may be down South, but we are not offshore."
Today we say with new meaning the Alabama state motto, we dare defend our rights.…Now more than ever, it is important for people of conscience to join together to recognize our common struggle against injustice and to fight back united.
The issue is one of fairness, said Sarita Gupta of Jobs with Justice, noting that with $23 million per year in compensation, Verizon's CEO makes "600 times more than an average frontline worker makes."
People arrived at the rally in 12 buses and several vans from Florida, New Orleans, Mississippi, Birmingham, Knoxville, Atlanta, Nashville, Columbia, Chattanooga and other cities throughout the region. They represent many unions and allied groups, including Jobs with Justice, Occupy Huntsville, Occupy Birmingham and the Student Labor Action Project (SLAP).Students from Orlando and Tallahassee took a 14-hour bus trip and slept in the local Plumbers and Pipe Fitters union hall.
Rallies supporting Verizon workers took place in 15 cities, including Philadelphia, Minneapolis, Boston, Portland, Miami and Orlando.
http://www.aflcio.org/Blog/Organizing-Bargaining/Workers-and-Allies-Barnstorm-Verizon-Shareholder-MeetingMembers of the 99% Power coalition disrupted Verizon's annual... more
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Transocean Ltd., the owner of the Deepwater Horizon oil rig that exploded off the Gulf of Mexico last year, has given its top executives bonuses for achieving the "best year in safety performance in our company's history'',
despite the blast that killed 11 people and spilled 200 million gallons of oil into the ocean.
Transocean noted "the tragic loss of life'' in the Gulf when the rig operated by BP PLC exploded last April. But it said the company still had an "exemplary'' safety record because it met or exceeded certain internal safety targets concerning the frequency and severity of its accidents, according to the filing with the Securities and Exchange Commission on Friday.
Safety accounts for a quarter of the executives' total cash bonuses. The total bonus for CEO Steve Newman last year was $374,062.
The company said in a regulatory filing that its most senior managers were given two thirds of their total possible safety bonus.
The company said its bonuses were appropriate as a way to recognise its executives' efforts in "significantly improving the company's safety record'' and implementing a new internal planning system.
Those efforts have "enabled the company to maintain its financial flexibility during a challenging period, while, at the same time, positioning the company for sustained growth in the future.''
Meanwhile, Al Jazeera has learned that a recent survey carried out in southern Louisiana, one of the worst affected areas, found a high number of people who say they are getting ill more often and their sickness is consistent with chemical exposure.
The massive oil spill sent dangerous compounds into the ocean; one of them was benzene which can cause cancer, as well as a chemical dispersant that was added to the oil to break it up.
Transocean's Deepwater Horizon oil rig explosion on April 20 in the Gulf of Mexico killed 11 workers and set off the largest offshore oil spill in US history.
A commission appointed by Barack Obama, the US president, earlier this year said the explosion was caused by a series of time and money-saving decisions by Transocean, BP and oil services company Halliburton Inc. that created an unacceptable amount of risk.
http://english.aljazeera.net/news/americas/2011/04/20114395819864760.htmlTransocean Ltd., the owner of the Deepwater Horizon oil rig that exploded off the Gulf... more
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Regardless of how the economy is doing it seems the super-rich come out ahead and to prove it, Wall St. has set yet another new pay record and the wealth gap widens.Regardless of how the economy is doing it seems the super-rich come out ahead and to... more
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That’s it, Joe. I’m changing my title to “Executive Editor.” I’m tired of getting the shaft!
Life at the Top: Endless Obscene Bonuses for Execs, Everyone Else Getting ShaftedThat’s it, Joe. I’m changing my title to “Executive Editor.”... more
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Despite a global financial meltdown tied to reckless risk-taking, I'm hearing a disturbing trend in advance of upcoming annual shareholder meetings: Most companies are still paying executives in ways that foster short-termism at the expense of long-term sustainability.
I recently spoke at a Financial Times conference in New York about how sustainability is a central corporate governance issue, but left there only partially encouraged. Major investors like John Wilson of TIAA-CREF and Brian Rice of the California State Teachers' Retirement System (CalSTRS) described the innovative ways they’ve made sustainability a part of their company engagement and proxy voting policies.
But these were the exceptions — most companies are still not talking with investors and their boards about sustainability.
I was also disillusioned when Merck’s director of corporate responsibility, Maggie Kohn, expressed concern that most investors are not using information in corporate sustainability reports.
Let’s be clear. Today’s global realities — a changing climate, rapidly emerging economies and the expected arrival of some 2 billion additional humans — demand new business models. If we fail to address the serious risks facing companies now, we will not only face another financial-sector meltdown, we’ll encounter environmental and social upheaval on a scale never before seen.
So what to do?
We all know that one of the fastest ways to get people’s attention is to bring pay into the equation. That’s why I think some of the most exciting news has to do with the innovative compensation schemes a few companies are using to weave sustainability into the fabric of their businesses.
What I like about these three models in particularly is that they show the path forward in different ways ...
http://solveclimate.com/blog/20100426/creative-compensation-plans-weave-sustainability-fabric-businessDespite a global financial meltdown tied to reckless risk-taking, I'm hearing a... more
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Power, not productivity, determines earnings. That's why new laws are needed to check the unfair distribution of the fruits of workers' labors.
By Moshe Adler | January 4, 2010
A recent Time magazine poll found that 71% of Americans who responded want the government to place limits on the executive compensation at firms that received bailout money. Yet accomplishing this task selectively is impossible to do.
The government did appoint a czar of executive compensation for these corporations, but he approved a $7-million salary/$3.5-million bonus plan for the head of AIG, 80% of which is now owned by taxpayers. Few workers, executives included, would agree to work for less than the going rate. Executives are simply used to earning millions of dollars, and there is little that either the czar or shareholders can do about it unless Congress limits all executive compensation. But the chance of such legislation passing is slim.
Why is limiting executive compensation so difficult? Because executives have a seemingly unassailable argument -- market forces -- that University of Chicago professor Steven Kaplan defended in an October debate: "Market forces govern CEO compensation. CEOs are paid what they are worth."
Of course, market forces are cited not only to justify outsized compensation for executives but also poverty wages for workers. Textbooks claim that minimum wage laws and union wages create unemployment. Just what are these market forces, and should we let them determine executive compensation and wages?
When British economists David Ricardo and Adam Smith examined this question 200 years ago, they concluded that what a person earns is determined not by what the person has produced but by that person's bargaining power. Why? Because production is typically carried out by teams of workers, managers and machines, and the contribution of each member cannot be separated from that of the rest. A driver and a bus, for example, generate $100,000 of income a year. The driver is paid $25,000. Is this because the driver had transported 10 of the passengers without the bus while the bus had transported 30 of the passengers without the driver? The driver's pay is so small only because the driver is so weak at the bargaining table.
It was Smith who explained that the bargaining power of each party is determined by the laws that the government passes and the way that it enforces them, and that, as a rule, the government sides with employers against employees. He was particularly concerned with anti-unionization laws. Had he witnessed the largesse that boards of directors are permitted to offer executives, and the government's behavior toward executives in the current crisis, he probably would have added that the government also sides with executives against shareholders and taxpayers.
Despite the logic of Ricardo and Smith's explanation that it is power, not productivity, that determines what people earn, the notion that people earn what they "deserve" persists. It dates to the Haymarket riot of 1886 in Chicago -- in which police and labor protesters clashed and several policemen and demonstrators were killed -- and the labor unrest that followed. Concerned about this unrest, John Bates Clark, a Columbia University professor, warned in an 1899 book: "The indictment that hangs over society is that of 'exploiting labor.' If this charge were proved, every right-minded man should become a socialist."
It was thus with a clear political agenda that Clark took it upon himself to prove that the charge of exploitation of workers was dead wrong. Clark's "proof" was to ignore the fact that production is carried out by teams and that individual contributions cannot be measured. He simply declared that the contribution of each individual worker and each machine could be measured, and that the earnings of either workers and executives or machines are simply the values of these contributions.
http://www.cartoonstock.com/lowres/hsc4456l.jpgPower, not productivity, determines earnings. That's why new laws are needed to... more
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One day after five execs reportedly threatened to jump ship over government-mandated pay cuts, Obama's "Pay Czar" Kenneth Feinberg is lifting a ban on salaries of over $500,000 per year at the bailed-out insurer AIG.
To put it bluntly, the threats worked.
Yesterday, the Wall Street Journal reported that a group of AIG executives vowed to resign if their pay was cut substantially by Feinberg. (Two of them later retracted the vows.) Today, Bloomberg points to what seems to be an enormous concession by Feinberg. Despite missed dividend payments to the government and nearly $200 billion in taxpayer support, some AIG employees will now be allowed to earn salaries of more than $500,000:
"It's the equivalent of saying, 'We're going home and we're taking our toys with us," Frank Glassner, CEO of Veritas Executive Compensation Consultants LLC, said yesterday in an interview. By paying more in salary, AIG is "increasing what may be considered guaranteed pay by bulking up salary."
Feinberg, the Obama administration's special master for executive compensation, said in October that base salaries at AIG wouldn't exceed $500,000 a year except in cases where there was "good cause" to pay more. Treasury Department and Federal Reserve officials have urged him to strike a balance between curbing excessive pay and retaining key employees. AIG was rescued with a bailout valued at $182.3 billion.
AIG executives, including traders who claim they weren't responsible for the insurer's near-collapse, argue that Feinberg's pay restrictions will cause an exodus of talent -- 50 execs have reportedly already left the firm.
In addition, AIG may not even be living up to its promise to cut back on the controversial $168 million "retention payments" the company made to employees in March. To date, the government has only received $19 million of the $45 million in retention payments AIG had pledged to repay, the WSJ reported in October. In fact, it's unclear whether those payments will ever be made in full:
"Company officials told investigators that receiving the additional $26 million could hinge on how Feinberg and AIG negotiate the second set of repayments.
AIG said in a statement Tuesday that it continues to work with Feinberg, and that employees in the financial products division have until the end of the year to fulfill their commitments to return a portion of the March payments."One day after five execs reportedly threatened to jump ship over government-mandated... more
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I never thought it possible, but there's someone in the world who's a bigger crapweasel than George W. Bush. Even while puffed up with a zeppelin-load of hubris, held aloft by a million ass-lapping cronies, and pampered by a huge cabal of twits, idiots, and criminal asswipes George wasn't arrogant enough to say something so monumentally ignorant.I never thought it possible, but there's someone in the world who's a bigger... more
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The White House is calling for pay cuts for top ranking executives at the companies that received bailout funds (AIG, GM, Chrysler, Chrysler Financial, Bank of America, Citigroup, and GMAC). The administration wants the top 25 highest paid executives of these companies to take a 90% pay cut from last year. But the administration isn't stopping there. It also wants to reduce the amount of perks and bonuses executives can receive.
Does this mean that business executives will start to live like regular people?The White House is calling for pay cuts for top ranking executives at the companies... more
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"while there is no consensus among academic experts, world leaders at G-20 Summit
agreed to reform executive compensation, to avoid future credit shock""while there is no consensus among academic experts, world leaders at G-20 Summit... more
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Wall Street is whining over Obama’s executive pay cap. The moment they borrowed our money to fund their lifestyles of the rich and richer, it became fair we should get a say on the terms.Wall Street is whining over Obama’s executive pay cap. The moment they borrowed... more
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Bonuses will be paltry on Wall Street this year, at least relative to the excesses of past years, but this may be for the best, according to The New York Times. "Critics say bonuses never should have been so big in the first place, because they were based on ephemeral earnings. These people contend that Wall Street's pay structure, in which bonuses are based on short term profits, encouraged employees to act like gamblers at a casino — and let them collect their winnings while the roulette wheel was still spinning." In 2006, Merrill Lynch's head mortgage honcho made a $35 million bonus. That same year, Goldman Sachs paid more than 50 people $20 million each. "Compensation was flawed top to bottom," said Lucian A. Bebchuk, an expert on compensation from Harvard Law School. "The whole organization was responding to distorted incentives."Bonuses will be paltry on Wall Street this year, at least relative to the excesses of... more
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