CORPORATE MALPRACTICE: Corporate CEOs are making INSANE profits while raising prices on Americans
Wages of Americans have been growing recently but depending on where you land on the pay scale between minimum wage workers and corporate CEOs, exactly how much of a raise you can get can drastically vary.
While there are signs that the rapid wage growth experienced by most Americans is slowing down, the pace is still above normal with a roughly 5 percent annual raise compared to the pre-pandemic trend of 3 percent.
However, if you are the CEO of one of the largest corporations in the United States, you are laughing it all the way to the bank. A recently released report shows how these CEOs make 254 times what their median employees earned in 2021 due to executive bonuses and stock awards. That translates to CEO compensation at some of the wealthiest firms in this country soaring by $20 million in 2021, a 31% increase from the previous year.
This is all happening as big corporate actors continue to blame social spending and supply chain issues for inflationary pressure resulting in higher prices for consumers. Two-thirds of the largest publicly traded US companies reported bigger profits in the first nine months of 2021 compared with the same period in 2020. That means that these huge corporations are passing any increased costs for materials, labor, and transportation on to the consumers when they could very easily absorb them into their bottom line.
It’s corporate greed, plain and simple.
In an op-ed for The Guardian, former U.S. Labor Secretary Robert Reich argues how inadequate antitrust enforcement is leading to a concentration of economic power in the hands of a few corporate giants. This is leading to an out-of-control system in which a few corporate conglomerates that essentially act as monopolies can raise prices with impunity to rake in record profits due to their unchallenged market power.
If you don’t believe me or Robert Reich, you can hear it from a corporate CEO himself.
John Catsimatidis, president of Gristedes Supermarkets and D’Agostino Supermarkets, recently said on Fox Business, “if Wall Street CEOs are off by a penny in earnings, Wall Street is not forgiving, so what are CEOs doing? They are raising prices… why give away something, when you don’t have to give it away and you make more margin.”
To make it clear, that’s an admission from a leading businessman that greedy business leaders are raising prices on consumers and making more money for themselves in the process and are using the inflation narrative to cast blame elsewhere. It’s disingenuous and wrong.
All those record profits made by squeezing the pocketbooks of working-class Americans end up in the pockets of CEOs of companies like Apple, Microsoft, Raytheon, and Intel through cash bonuses and stock incentives that the CEOs award to themselves.
According to the latest edition of the Equilar 100, an annual report that spotlights executive pay:
“While median salary and median perks increased incrementally, the largest jumps were examined in the form of cash bonuses and stock awards,” the Equilar analysis points out. “The median value of stock awards increased by 22.7% in 2021, from $8.6 million to $10.5 million. Meanwhile, cash bonuses increased by 46.4% in 2021, from $2.8 million to $4.2 million.”
The highest-paid CEOs on the Equilar report were Pat Gelsinger from Intel who earned $177.9 million in 2021, followed by Tim Cook from Apple who earned $98.7 million last year, a 569% increase from 2020.
While these exorbitant levels of corporate pay take place, American workers deal with rising housing, food, and other prices that are offsetting their modest wage increases. Most of these giant corporations are still opposed to a minimum wage increase to $15 an hour, which would translate to a still inadequate $2,400 a month if working an average 40 hours per week.
Workers — tired of the massive inequality and unfair treatment by their corporate bosses — are taking action. Across America, dozens of Starbucks locations have held successful union drives and the Amazon warehouse in Staten Island recently held its first successful union election, the latter being supported by 75 percent of Americans according to a recent poll.
It’s clear that an unregulated market has allowed irresponsible and greedy corporate actors to exploit workers while shamelessly raising prices to pad their own wallets. As consumers and citizens, we need to support workers who are taking matters into their own hands by unionizing their workplaces against greedy bosses while demanding that the government step up and regulate these big corporations and enforce antitrust laws that break up their monopolizing power.
Thomas Kennedy is an elected Democratic National Committee member representing Florida. He tweets from @tomaskenn.
RELATED STORY: OPINION: New report outlines out of control corporate corruption in Florida
is a former reported opinion columnist and roving correspondent. He's an elected member of the Democratic National Committee from Florida and a fomer Director of Sunshine Agenda Inc. a government transparency nonprofit organization.