Corporate greed is out of control!
CEO's income jumps from $8.4 to $22.8 million in three years while workers struggle to survive on $18/hour.
Where do the billions in automaker profits go? Follow the money, lavish salaries, private jets and luxury perks with this map. Learn about the tax loop holes that execs and super rich investors use while autoworkers pay their taxes?
"The fight is not only about decent wages, decent benefits and decent working conditions in the automobile industry. No. The fight you are waging is a fight against the outrageous level of corporate greed and arrogance that we are seeing on the part of CEOs who think they have a right to have it all and could care less about the needs of their workers." - Bernie Sanders
- $2.1 million in salary
- $14.6 million in stock awards
- $4 million in option awards
- Nearly $7.6 million in incentive plan compensation
- $873,075 in other payments
- Beyond the lucrative salary, GM also spent $413,368 last year for personal travel, security, company vehicle programs, executive physical and financial counseling for Barra. - Yahoo Finance
Ford CEO Jim Farley received total compensation of $22,813,174 in 2021 for running the company, according to the Dearborn automaker. Farley's benefits included $830,305 for personal use of aircraft The ratio of the CEO's total compensation to the median of all employees' total compensation is 356 to 1. Ford spent more than $74.5 million in executive compensation for its top five executives in 2021. Jim Hackett - former CEO kept $16.7M pay package in 2020 despite stepping down. - Detroit Free Press
Stealth compensation and Stock Buybacks
Companies can increase executive compensation by allowing dividends to be paid on unvested restricted stocks grants, also known as stealth compensation… CEOs' stealth compensation amounts to an average of $180,000 in additional income…" - Science Direct
The allocation of corporate profits to stock buybacks deserves much of the blame… companies used 54% of their earnings—a total of $2.4 trillion—to buy back their own stock, almost all through purchases on the open market. Dividends absorbed an additional 37% of their earnings. That left very little for investments in productive capabilities or higher incomes for employees.
The buyback wave has gotten so big, in fact, that even shareholders—the presumed beneficiaries of all this corporate largesse—are getting worried. “It concerns us that, in the wake of the financial crisis, many companies have shied away from investing in the future growth of their companies,” Laurence Fink, the chairman and CEO of BlackRock, the world’s largest asset manager… - HBR
Carried interest loophole - The carried interest loophole allows private equity barons to claim large parts of their compensation for services as investment gains, which allows them to pay lower tax rates than middle class taxpayers pay on their wages and other compensation. The loophole exacerbates income and wealth inequality. Treating carried interest income as ordinary compensation income could raise between $1.4 billion and $18 billion annually. - Our Financial Security
Carried interest - The super wealthy get their money comes from “carried interest” and from the appreciation of their ownership interests in stock, real estate and other assets. Stock values can increases by millions every year but no income tax is due. increases in the value of shares of stock, and of real estate, aren’t taxed until sold and if never sold, may never be taxed. - Truthout
Pass along your wealth tax free - Suppose a billionaire bequeaths his billions to his spouse. Spouses can receive unlimited bequests without estate taxes, and better still, the value for tax purposes is “stepped up” at death so that if everything is sold to realize the gains, no income tax is due as there is no capital gain. The “cost” of the billions was redefined to be value at death. - Truthout
Charity scam - Another way the wealthy avoid paying taxes on their billions is to make charitable donations. Charities only have spend about 5% of their investment assets annually, and all or part of this amount can be spent on salaries and “expenses,” rather than devoted to the charitable purpose the charity purports to be serving. So, what happens with a charitable trust, set up by a billionaire, and controlled by one of the billionaire’s children? The child gets a job and a salary for life. Maybe a mansion to live in and entertain in as a fringe benefit. No income tax is due on the money the parent donated to set up the charity—even though the parent may have made the charitable donation so as not to pay any tax on an appreciated asset. - Truthout
TakeAway: Stand with the UAW in their fight against corporate greed for fair wages.
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Strike demands - MSU Today
- Eliminate tiers on wages and benefits. Currently, domestic automakers have a tiered wage system in which those in the first tier earn about $28 per hour, while those hired after 2007 are in the second tier and earn about $16 to $19 per hour. The number of second-tier workers is growing, which is fueling this contract demand.
- Increase wages by 46% over four years
- Restore cost-of-living allowances
- Establish a defined benefit pension for all workers
- Reestablish retiree medical benefits
- Ensure the right to strike over plant closures
- Create a working family protection program
- Make all temporary workers permanent
- Institute more paid time off
- Significantly increase retiree pay
- Possibly institute a 32-hour work week