By Greg O’Brien, Codfish Press
Ouch! Pay your taxes last week on time? There goes money for that kitchen renovation, new deck, boat repair, or perhaps the college fund. If you were one of the privileged ones, you paid it out of an executive salary package, a year-end bonus or cashing in company stock. And if you had a good tax lawyer, proportionately you paid much less than the rest of us, or maybe nothing at all. Congratulations for profiting off our nickel. “A lot of taxes will go unpaid at the top of the income scale,” David Schizer, dean of the Columbia Law School and an attorney who specializes in tax law wrote in The New York Times.
Pity the poor CEOs these days. For they shall inherit the planet! The medium 2006 compensation for chief executive officers at 50 of the largest U.S. companies, according to a special USA Today report last week, is $17.7 million—more than $1.4 million in salary, $4.1 million in bonus, $426,918 in perks and other compensation, and more than $9.6 in stock and option awards. And the heads of Wall Street’s choice financial firms, the paper reports, noting new disclosure rules, got some real money: Goldman Sachs CEO Lloyd Blankfein skipped off with $54.3 million in salary, bonus, options and restricted stock. Second place was never so sweet for Merrill Lynch’s CEO Stanley O’Neal, who was paid $46.4 million and exercised $16.7 million worth of options, the paper reports.
And how about getting paid for showing up! EMC Corp. CEO Joseph Tucci’s 2006 executive pay package cost the company $20.2 million in salary, bonus and company stock, The Boston Globe reported. While it represents a $9.6 million reduction from 2005, “Tucci’s lofty compensation didn’t sit well with corporate governance critics who say that the lackluster performance of EMC shares doesn’t justify Tucci’s income,” the Globe notes.
So what is it about these guys that justifies the colossal pay? Last time most of us checked, none of them had cured cancer, reversed global warming, raised the quality of inner city schools, quelled terrorism, pitched a shutout or hit a home run. Hey, they don’t even take out the trash!
And yet they pine for excessive, almost to the point of dissolute, salaries and tax breaks so some of the surfeit can trickle down to us—that is, if you subscribe to the waning principles of Reaganomics. A few of these titans also get “tax gross-ups,” code for corporate reimbursements for tax liabilities. The term is appropriate, a pitiable insult to the worker bees. Think about it next time you or a friend gets stung with a pink slip.