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Monday, October 24, 2016

Conservative pundits and politicians routinely divide our U.S. economy into two totally distinct spheres. We have the noble private sector over here, they tell us, and the bumbling, bloated public sector over there.

In reality, of course, we have just one economy, with the private and public sectors inextricably entangled. Each year, in fact, hundreds of billions of tax dollars end up flowing directly into the private sector.

The federal government alone, a new Congressional Budget Office report calculates, annually spends $500 billion — that’s half a trillion dollars — to purchase goods and services from private companies. State and local governments spend many billions more on top of that.

We’re not talking trickle here — we’re talking cascade, as our elected leaders rush to privatize services that public employees previously provided.

This massive privatization of everything from prisons to public schools hasn’t done much of anything to make the United States a better place to live.

On the other hand, this privatization has paid off quite handsomely for America’s most affluent. They’re collecting ever more generous paychecks, courtesy of the tax dollars the rest of us are paying.

In Washington, D.C., for instance, top officials of the private companies that run many of the city’s charter schools are taking in double or triple what traditional public schools take in, or even more.

The CEO at one company that runs five of these charters, The Washington Post recently reported, pulled in $1.3 million in 2013. That’s nearly five times the pay that went to the top public official responsible for the District of Columbia’s 100-plus traditional public schools.

America’s taxpayer-funded military contractors would, of course, consider that chump change. The CEO at Lockheed Martin, for one, personally pocketed over $25 million in 2013.

So do you like this idea of executives in power suits raking in multiple millions of your tax dollars?

Rhode Island state senator William Conley sure doesn’t. He and four of his colleagues have just introduced legislation that would stop the stuffing of tax dollars into the pockets of wildly overpaid corporate executives.

Conley’s bill directs Rhode Island to start “giving preference in the awarding of state contracts” to business enterprises whose highest-paid execs receive no more than 25 times the pay of their median — most typical — workers.

Back in the middle of the 20th century, only a handful of top corporate executives ever made more than 25 times the pay of the average worker. Today, by contrast, only a handful of top execs make less than 100 times median pay.

If Conley’s bill becomes law, the ramifications could be huge.

That’s because we may soon know, for the first time ever, the exact ratio between CEO and median worker pay at every major American corporation that trades on Wall Street.

Five years ago, legislation that mandates this disclosure passed Congress and made it into law. Intense corporate lobbying has been stalling its enforcement, but the stall may soon end. The federal Securities and Exchange Commission finally appears ready to issue the regulations needed to enforce full pay ratio disclosure.

CEO-worker pay comparisons for individual companies will likely start hitting the headlines the year after next. With these new stats, taxpayers will be able to see exactly which corporations feeding at the public trough are doing the most to make America more unequal.

With this information, average taxpayers could then do a great deal. They could, for starters, follow Senator Conley’s lead in Rhode Island and urge their lawmakers to reward — with our tax dollars — only those corporations that pay their workers fairly.

OtherWords columnist Sam Pizzigati, an Institute for Policy Studies associate fellow, edits the inequality monthly Too Much. His latest book is The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970.

Distributed by OtherWords

Photo: Brendan Hoffman via Flickr

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  • Insinnergy

    I hope there’s a way back from here. America has self-evidently got to the point where greed supercedes honesty, decency, ethics, morals, shame, compassion and justice.

    Consider the For Profit Colleges… Preying on those who are the least able to assess the worth of their offering, and who are hoping for a better life through education only to end up indentured, paying and with a worthless “degree”.

    Consider the excellent piece on Last Week Tonight on the privatisation of bail, fine payment and other Justice system functions where essentially the payments are endless, no-one cares, and corporation gets paid first, and the individual becomes a serf to be milked or thrown into “Debtor’s Prison” if they can’t be milked any more. The person gets a $100 fine that they can’t pay… they are charged $35 to start a payment plan… ($135) they get charged interest every month at a ridiculous rate… and when they pay small installments, the corporation gets paid first… the debt remains… and keeps accumulating more interest. In the end the person has paid $500, $800… $1000… but now owes $1200, and their original fine of $35 has never been reduced… all at no charge to the taxpayer… until they can’t pay and get thrown in jail… at a cost to the taxpayer of $3500 a day.

    Consider the privatisation of prisons that has led to appalling stories of neglect… food scandals… death.

    Consider Dick Cheney.

    The sad fact of the matter is that Americans will screw anyone including their own countrymen and women, kill anyone (indirectly), bribe, torture anyone, dodge any law, knowingly pollute drinking water, knowingly withhold insurance, knowingly set up systems of debt dependency that cruelly ruin people’s lives, lie, cheat and steal…. as long as they get paid.
    The era of Pluto-Narcissism is here.

    Money has become the only thing that matters in too many levels of American society. And few seem to care that you are grinding up, torturing and destroying your own people.

    The funniest thing is you seemingly regard your country as righteous, special and replete with Christian values. Perhaps it used to be. No longer.

    But as it turns out: The Cross is still an excellent symbol for America as long as it has a sign beside it saying: “Will nail anyone to this for money.”

    • TheSkalawag929

      We, the American people, are our own worst enemy. We elect people to State office that back these kinds of actions are introduced and we allow them to continue without question.

    • Independent1

      Great post!! What you’ve just posted is a clear description of what has become
      the Devil’s party: the GOP; over the past 35 years or so, since Reagan started it down that path to true depravity and total immorality.

      And what’s sad, is that along the way, it has done that while luring millions of clueless Americans into believing, that somehow, they’re a Christian loving organization. While the GOP works night and day, to lead even their believers – not only to premature deaths via every subterfuge they can come up with, as you so eloquently described: but also by even leading them to damnation from God, by enticing them to love money above all else. For as Jesus said: You cannot love God and Mammon (money/worldly riches); no matter how hard you try to make real Christians believe you can and still be a Christian. What you’ve described is clearly the work of Satan, as he’s succeeded in corrupting the minds and spirits, of so many Americans.

  • Eleanore Whitaker

    If you watched the House Budget Hearings this past week, you heard some very shocking things about the GOP’s budget. The total cost of tax expenditures is $1.4 trillion. It includes taxpayers paying for corporate jets.

    You heard Paul Ryan, that little snot nosed punk stand there and arrogantly try to deny that the GOP didn’t support OCA even when Rep. Van Hollen (D-MD) read aloud the GOP own statement approving that expenditure.

    You heard Rep. Gwen Moore (D-WI) lash into the GOP for a budget that basically “creates a huge slush fund by 2020” and creates more tax loopholes for the rich who earn over $1 million a year.

    You heard Rep. Nydia Valasquez remind the GOP that cutting $182 billion for small business who “do all the hiring and job creating” would cause more, not less unemployment.

    The GOP isn’t the last word on government. Your Constitution protects the minority as well as the majority equally in government.

    Call you Dems and insist they push back and do what these three Representatives have…smack the GOP upside their greedy heads for this horrendous budget that will slash SS, Medicare and Medicaid before it touches one dime of their billionaire campaign donors.

    As Sen. Sanders of VT stated, 14 billionaires in the US earned another $200+ billion in wealth in 2014. How much more do they need?

  • atc333

    Why do you think the GOP now stands for the Party of Greed, Oligarchy, and Profit?

  • Nat Ional

    We need to keep in mind that sometimes, on these Middle East issues, conservatives are too naive to recognize that their patriotism is being used against them.