Monday, September 5, 2011

The War of All Against All

Here is a bit from a post by Barry Ritholtz in his The Big Picture blog:
There is a huge Washington Post special report on Breakaway Wealth in the US. More than most other industrialized nations, the US has seen the top 0.1% compensated in vastly disproportionate numbers versus the rest of the populace.

There are at least several reasons to be concerned about this, beyond basic fairness: 1) Nations that have extremes wealth disparities tend towards social unrest. Usually, its banana republics and dictatorships, but it could happen in a corporate-owned quasi democracy as well. 2) CEOs and other company insiders have been engaging in a massive grab of shareholders wealth for decades. Its gotten appreciably worse in the 2000s. 3) Management is now trying to hide their compensation from the business owners — the firm’s shareholders

Making matters even more outrageous, these CEOs are trying to pass legislation that would legally allow them to not to disclose executive compensation at public companies:
“Here’s one financial figure some big U.S. companies would rather keep secret: how much more their chief executive makes than the typical worker. Now a group backed by 81 major companies — including McDonald’s, Lowe’s, General Dynamics, American Airlines, IBM and General Mills — is lobbying against new rules that would force disclosure of that comparison.

The lobbying effort began more than a year ago. It involved some of the biggest names in corporate America and meetings with members of both parties on the House Financial Services Committee and Senate banking committee. The companies and their Republican allies in Congress call comparisons between the chief and everyone else in the company “useless.”

But some Democrats and investors say the information should be issued to highlight the growing income disparity in the United States. They add that opponents of disclosure merely want to hide the outrageous scale of executive pay packages.”
Legalized theft of shareholder assets, approved by a corrupt Congress. What little respect I had left for the GOP is now completely gone. This is not “business friendly” — its utterly corrupt theft of shareholders.

The charts below (click for larger graphics) show exactly how absurd this has become. The rumors you may have heard about class warfare have been greatly exaggerated . . .

Click to Enlarge

Click to Enlarge

Special Report: Breakaway Wealth
An ongoing Washington Post series about how the rich are pulling away from the rest of America

My only comment on the bleak facts set out above is to point to something written by Robert Paul Wolff on his blog:
We are living in ugly times, and those of us old enough to recall the unraveling of the Weimar Republic and the onset of Nazism find it hard to be sanguine that nothing at all like that can happen here.
I came of age in the interregnum created by the Great Depression and WWII which gave the bottom 90% of the population a fair chance to succeed. But sadly we are back to the pre-1929 and post 1980 worlds where the rich are the gatekeepers and they are only too happy to kick those who are already down while turning the state into a prison for the bottom 90%. The rich have declared themselves "masters of the universe" and wish to be done with the riffraff except to have us slave behind the scenes to ensure they have big mansions, products of the finest artistry, and large staffs of groveling servants.

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