www.mozilla.com Weather Central
Voices
Headlines

Defense against demagogues -1/30/2015, 9:44 AM

Kansas is at risk -1/30/2015, 9:44 AM

Football injuries -1/30/2015, 9:44 AM

A note on primitivism -1/29/2015, 9:55 AM

Owning ideas -1/29/2015, 9:55 AM

There's more -1/29/2015, 9:55 AM

Kansas' birthday -1/29/2015, 9:55 AM

Back to the future, locked and loaded -1/28/2015, 9:29 AM

Compromise -- make it happen -1/28/2015, 9:29 AM

Faith v. facts -1/28/2015, 9:29 AM

Counting on Les -1/27/2015, 9:22 AM

Building bills in the Legislature -1/27/2015, 9:22 AM

Tale of the tree -1/27/2015, 9:22 AM

Seismic activity -1/27/2015, 9:22 AM

Where are the good guys? -1/27/2015, 9:21 AM

Brownback's budget -1/26/2015, 9:59 AM

Committee meetings begin -1/26/2015, 9:50 AM

Excitement starts at Capitol -1/26/2015, 9:50 AM

What's happening with oil prices? -1/26/2015, 9:50 AM

Synthetic biology, brave new world -1/26/2015, 9:50 AM

Today's fierce urgency is voter mobilization -1/25/2015, 5:02 PM

Duke, Muslims and politics of intimidation -1/25/2015, 5:02 PM

Right to hunt -1/25/2015, 5:02 PM

Pipeline: Foreign profits, American risk -1/23/2015, 7:47 AM

Social Darwinist 'Christianity' -- Chapter 3 -1/23/2015, 7:47 AM

Kiwanis generosity -1/23/2015, 7:47 AM

The state economy -1/22/2015, 10:23 AM

Restate of the union -1/22/2015, 10:23 AM

France needs our First Amendment -1/22/2015, 10:23 AM

Repurposing Washington -1/20/2015, 9:31 AM

March for Life -1/20/2015, 9:31 AM

Brownback, the budget and schools -1/20/2015, 9:31 AM

Sensible checks are no assault on gun rights -1/19/2015, 9:50 AM

Jeb Bush chooses expedience on marriage issue -1/19/2015, 9:50 AM

The State of the State Address and the legislative session -1/19/2015, 8:47 AM

Spending's not the culprit in budget woes -1/18/2015, 3:32 PM

Pilgrim's paradise -1/18/2015, 3:32 PM

Spring elections -1/18/2015, 3:23 PM

Kobach is back -1/16/2015, 3:04 PM

More with Les -1/16/2015, 10:03 AM

Understanding Hooper -1/16/2015, 10:02 AM

Basic economics -1/16/2015, 10:01 AM

Female governance -1/15/2015, 9:37 AM

2015 energy policy -- a unique opportunity -1/15/2015, 9:37 AM

The better option -1/15/2015, 9:36 AM

'Wall Street' a waste -1/14/2015, 2:50 PM

Trade already -1/14/2015, 2:49 PM

No media bias? -1/14/2015, 2:48 PM

Retirement funds -1/14/2015, 2:47 PM

Redefining public education in Kansas -1/13/2015, 10:06 AM

What the future holds -1/13/2015, 10:06 AM

Efficient education -1/13/2015, 10:06 AM

Terrorists usher in the 'End of Satire' -1/12/2015, 9:14 AM

Sexuality, lame logic, substandard science -1/12/2015, 9:14 AM

A tragic family story -1/11/2015, 12:11 PM

For freedom, LGBT rights, a year of decision -1/11/2015, 12:11 PM

Roberts' promotion -1/11/2015, 12:11 PM

FHSU campaign -1/11/2015, 12:11 PM

Fairness in U.S. -1/9/2015, 3:05 PM

Liberals' use of black people -- Part II -1/9/2015, 9:09 AM

Social Darwinist 'Christians' -- Chapter 2 -1/9/2015, 9:09 AM

Taxing situation -1/9/2015, 9:09 AM

Trust: Society depends on it -1/8/2015, 9:55 AM

Education schools lack a paradigm -1/8/2015, 9:55 AM

Congress convenes -1/7/2015, 10:07 AM

Simple way to fix gridlock: change committees -1/7/2015, 10:06 AM

Kansas is your customer -1/7/2015, 10:06 AM

Large budget shortfalls await solution -1/6/2015, 10:06 AM

The state and funding K-12 education -1/6/2015, 10:06 AM

Tree removal -1/6/2015, 10:06 AM

Republicans won -- now what? -1/5/2015, 9:13 AM

Social Darwinist religion, Chapter 1 -1/5/2015, 9:13 AM

Liberals' use of black people -1/2/2015, 9:53 AM

Ignorance abounds -1/2/2015, 9:53 AM

Superbug dilemma -1/2/2015, 9:53 AM

Thanks North Korea -12/31/2014, 1:26 PM

Sony gets the last laugh -12/31/2014, 1:26 PM

Free speech -12/31/2014, 1:16 PM

New Year's resolutions -- sort of -12/31/2014, 9:22 AM

A flat-footed backflip for Wall Street -12/31/2014, 9:22 AM

Dim the lights -12/31/2014, 9:22 AM

Some near-sure bets for the new year -12/31/2014, 9:21 AM

Adios, Rick Perry -12/30/2014, 8:20 AM

Budget strife means high-anxiety session -12/30/2014, 8:20 AM

Time for caution -12/30/2014, 8:20 AM

-12/29/2014, 10:01 AM

Court's raw deal -12/29/2014, 10:01 AM

Chris Christie's pork barrel politics -12/29/2014, 10:00 AM

A Festivus Miracle -12/27/2014, 4:18 PM

Faith, not politics, keeps Christ in Christmas -12/27/2014, 4:18 PM

EPA rule falls short -12/27/2014, 4:18 PM

2014: The year in Kansas higher education -12/26/2014, 9:39 AM

Methane from cattle -12/26/2014, 9:39 AM

Black progression and retrogression -12/26/2014, 9:38 AM

Up-Lyft-ing Christmas tale -12/25/2014, 1:22 PM

Terrorism on soft targets -12/25/2014, 1:22 PM

Story of Christmas -12/25/2014, 1:22 PM

Fabricated column -12/24/2014, 8:21 AM

The Christmas spirit dwells in us all -12/24/2014, 8:21 AM

Celebrating life -12/24/2014, 8:21 AM

myTown Calendar

SPOTLIGHT
[var top_story_head]

Runaway CEO pay gets a free pass

Published on -6/27/2013, 9:57 AM

Printer-friendly version
E-Mail This Story

Only 10 percent of Americans now have confidence in Congress, Gallup informs us. No other major American institution has ever had an approval rating this low.

But public confidence in Congress would probably sink even lower if average Americans knew more about what our lawmakers are actually doing. The latest case in point: the steady progress of H.R. 1135, the "Burdensome Data Collection Relief Act."

This particular piece of legislation speaks to an ongoing frustration in America's body politic: CEO pay. Most Americans think corporate executives are grabbing far too much compensation.

Not the members of the House Financial Services Committee. By a 36-21 margin, they've just voted to repeal the only statutory provision now on the books that puts real heat on overpaid CEOs. The full House, observers expect, will shortly endorse this repeal.

The specific provision 31 Republicans and five Democrats voted to overturn -- section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act -- imposes a new disclosure mandate on corporations.

Under Dodd-Frank, as enacted into law, major companies must annually reveal the ratio between what they pay their CEOs and what they pay their median -- most typical -- workers.

Corporate pay reformers consider this ratio to be crucial information for reining in executive excess. If Americans could see -- and compare -- the exact CEO-worker pay ratio from one corporation to another, the reformers believe, the resulting negative publicity on the corporations with the widest pay gaps might just discourage excessive future executive compensation.

And if corporations ignored this negative publicity, Dodd-Frank's disclosure mandate could serve as a stepping stone to tougher reforms. Lawmakers could, for instance, set a specific CEO-worker pay multiple as the nation's preferred corporate compensation standard and deny tax breaks -- or government contracts -- to corporations that pay execs above that standard.

Pay ratio disclosure clearly has the potential to help extinguish what one Forbes analyst calls "the out of control wildfire" that executive pay has become. But the mandate hasn't so far extinguished anything.

Corporate lobbyists have seen to that. They've been pressuring the Securities and Exchange Commission, the federal agency that must issue regulations before any new mandate over corporate behavior can be enforced. The agency has so far issued no regulations on CEO-worker pay disclosure. And nearly three years have gone by since Dodd-Frank initially worked its way into law.

America's corporate leaders, meanwhile, don't want to have to rely solely on their ability to intimidate the SEC. They've also orchestrated a congressional drive to simply repeal the Dodd-Frank pay disclosure mandate outright.

How can lawmakers who carry Corporate America's water possibly defend repealing a measure as common-sense as pay ratio disclosure? Easy. They simply paint corporations as the victims of overzealous government bureaucrats out to drown them in burdensome -- and meaningless -- paperwork.

These repealers are doing their best to trivialize Dodd-Frank's pay ratio mandate. Today CEO-worker pay disclosure, joked House Financial Services chair Jeb Hensarling, R-Texas, in one recent debate -- tomorrow a mandate that companies calculate the ratio of healthy to unhealthy drinks in company soda machines.

"I assume," Hensarling smirked, "there is an infinite number of ratios some investors would find helpful to their decisions."

Serious business analysts see executive-worker pay ratios as anything but trivial. Peter Drucker, the father of modern management science, believed that any corporations that had executives making over 20 or 25 times worker pay are placing employee morale and productivity at risk.

A host of public interest groups, organized in Americans for Financial Reform, also make a similar case for pay gap disclosure.

To sum this all up, the Dodd-Frank law's section 953(b) was duly enacted into law, then ignored and never enforced, and now stands in jeopardy of getting repealed into oblivion. What can we learn from the sad, still-unfolding tale?

Maybe this: In a democracy, elected leaders represent the people. In a plutocracy, like ours, elected leaders represent the people -- and listen to the rich.

OtherWords columnist Sam Pizzigati is an Institute for Policy Studies associate fellow. His latest book is "The Rich Don't Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class."

digg delicious facebook stumbleupon google Newsvine
More News and Photos

Associated Press Videos

AP Breaking News
AP Nation-World News

View this site in another language.