Mutual Financial Companies In The Era of Generation Greed
Looks like some of those damn capitalists are making uncomfortable comparisons between executive pay and shareholder (or in this case policyholder) dividends again. From the Boston Globe: “Phantom stock and phony options still add up to nearly $200 million in very real United States currency, all of which (the former CEO) took out of Liberty Mutual in his last four years as chief executive…The only phantom anything are the dividends that never got paid to the policyholders that actually own Liberty Mutual. What these owners got were rate hikes, while Boston and Massachusetts residents gave the company $46.5 million in tax breaks, all to help fund an utterly grotesque level of executive pay.” The board members and current executives defend that pay. “Friday’s performance revealed that these guys are so out of touch that they truly, honestly believe they’re worth that million a week, or $192,000 a day, or $24,000 an hour - and can’t for the life of them imagine that you don’t. They actually believe the system is fair, the one they stacked with interlocking boards of directors of like-minded people paid a couple of hundred thousand dollars a year to approve each other’s pay.”
So much for the idea of replacing Wall Street with mutual financial companies. In the era of Generation Greed, that seems to work as well as shifting public money to the non-profit sector, which in New York degraded to non-profiteers. When every institution is being pillaged by those who control it, there is nowhere to hide from the institutional collapse. So who do you think hates this comparison more? The public employee unions, when I point out that the retroactive pension deals they cut with the legislators they control are just as unjust and damaging to the serfs as what has gone on on Wall Street? Or the top executives, when I point out that their pay is a result of the power of their de facto union, not a free market?
You know what I want to see in accounting statements? I want to see this. The salary of the President of the United States was increased to $400,000 some years back. That salary tends to be frozen for decades due to the politics of increasing it, but taking the last time it was increased as a baseline and increasing it for inflation puts it at around $500,000 in today’s money. I want to see the pay, including the value of deferred pay, bonuses, commissions, etc. in excess of $500,000 paid to every company employee added up. And compared with the total paid in dividends for the year. How much in excess of the President pay for the highest paid employees, and how much in cash dividends for the investors?
Of course I’m not in a position to demand that as a shareholder. Since out savings is in mutual funds that actually hold the shares, and are controlled by other members of the “interlocking boards of directors of like-minded people paid a couple of hundred thousand dollars a year to approve each other’s pay.”
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