Oldie from the archives: “The real crisis… isn’t climate change – it’s income inequality”

This is from my post June 22nd, 2022.

Yes climate change is a problem but it can be mitigated so it doesn't become a crisis.

But income inequality? Inequality also explains how Trump got elected in 2016.The article below is from the Guardian (UK), which is a socialist paper. But the answer isn't socialism. The median income (50% of workers below the median, 50% above) shown below is actually well under the median income of all individual wage earners in the U.S. Nationally the median income is about $43,000. the median income in NY City is about $55,000. Thinks about it – 50% of wage earners in NYC make less than $55,000 a year.

One of the big points they try to make in this article – that stock buybacks inflate senior executives pay – is not really very consequential.

Wage gap between CEOs and US workers jumped to 670-to-1 last year, study finds. Report on 300 top US companies found CEOs making an average of $10.6m, with the median worker getting $23,968

“CEOs’ pandemic greed grab has sparked outrage among Americans across the political spectrum,” said report lead author Sarah Anderson, director of the IPS Global Economy Project. She cited one recent poll that showed that 87% of Americans see the growing gap between CEO and worker pay as a problem for the country.

IPS noted that many of the companies in its sample were also the recipients of large federal government contracts. Forty companies in the sample were awarded $37.2bn in government contracts between 1 October 2019 and 1 May 2022.

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Amazon, the second-largest federal contractor in the sample, amassed $10.3bn in federal contracts. Last month shareholders approved a $212m pay deal for Amazon’s CEO, Andy Jassy, 6,474 times the company’s median pay.

This report offers a number of policy solutions, including actions president Joe Biden could take without waiting for Congress. “The president could wield the power of the public purse by introducing new standards making it hard for companies with huge CEO-worker pay gaps to land a lucrative federal contract,” Anderson said. The report also urges Biden to ban top executives at federal contractors from selling their personal stock for a multi-year period after a buyback.