Executives Receive One-Third Of All Pay In The U.S., But Congress Is Still Afraid Of A Surtax
Executives Receive One-Third Of All Pay In The U.S., But Congress Is Still Afraid Of A Surtax
The New York Times reported today that Democratic leaders, “bowing to unease among lawmakers and governors in their own party,” are reconsidering the House Ways and Means committee’s proposal to implement a surtax on the richest one percent of Americans as a way of financing a portion of health care reform.
There has indeed been a lot of pushback against the surtax proposal, which prompted Speaker of the House Nancy Pelosi (D-CA) to suggest that only households making more than $1 million should be subject to it, instead of the graduated scale starting at $350,000 that Ways and Means proposed.
But those feeling squeamish about the tax should take a look at this analysis in the Wall Street Journal, which shows how big a slice of the income pie the rich are currently receiving:
Executives and other highly compensated employees now receive more than one-third of all pay in the U.S., according to a Wall Street Journal analysis of Social Security Administration data — without counting billions of dollars more in pay that remains off federal radar screens that measure wages and salaries. Highly paid employees received nearly $2.1 trillion of the $6.4 trillion in total U.S. pay in 2007, the latest figures available. The compensation numbers don’t include incentive stock options, unexercised stock options, unvested restricted stock units and certain benefits.
In the five years ending in 2007, earnings for American workers rose 24 percent, while the highest-paid saw a 48 percent increase. So as Kevin Drum noted, “in other words, the executives got a 48% increase, the rest of us got approximately nothing, and it all averaged out to 24%.” And to top it all off, median pay raises for this year and next are set to be the lowest in decades.
Income growth in America for the last few decades has been overwhelmingly concentrated at the top. Between 1979 and 2006, the inflation-adjusted after-tax income of the richest 1 percent of households increased by 256 percent, compared to 21 percent for families in the middle income quintile. According to the Center on Budget and Policy Priorities, households in that richest one percent “had $617 billion more income in 2006 (or $656 billion more if measured in 2009 dollars) than they would have had if the 1979 income distribution still prevailed.”
Increasing taxes on this small percentage of people — who have done very well for a very long time — would raise revenue to put toward health reform, which is the single biggest problem for America’s bottom line. As Sen. Bernie Sanders (I-VT) said, “it certainly is okay for me to tell my friends on Wall Street, who just got a bonus of $600,000, they’re going to pay more in taxes so we can lower health care costs in America.”
9 Responses to “Executives Receive One-Third Of All Pay In The U.S., But Congress Is Still Afraid Of A Surtax”
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What percentage of the workforce are the executives who get 1/3 of all the money?
July 22nd, 2009 at 12:17 pmIt says, Vickky, in the very first sentence:
proposal to implement a surtax on the richest one percent of Americans as a way of financing a portion of health care reform.
Got that?
1%.
July 22nd, 2009 at 2:33 pm@Dorson Orba
It most certainly does not say, D.O., any such thing.
It says 2 things:
1) 1/3 of the money goes to executives and other highly compensated employees
2) proposal to implement a surtax on the richest one percent of Americans
Nowhere does it say the 1% of richest americans = the executives and other highly paid employees.
Got that?
July 22nd, 2009 at 8:14 pmIncorrect. It’s unclear in this article, but in the linked report:
“the share of the nation’s total after-tax income going to the top 1 percent of households more than doubled, from 7.5 percent in 1979 to 16.3 percent in 2006.”
That’s 16.3% which is nowhere near 1/3
July 22nd, 2009 at 9:43 pmThere has indeed been a lot of pushback against the surtax proposal,
humm, I wonder who is doing the pushing back?
July 22nd, 2009 at 10:16 pmHmmm, I wonder how many are part of the law firms which file astronomical insurance and health care law suits against the medical industry, thereby making health care costs go up for the rest of us?
July 22nd, 2009 at 10:19 pmTHIRD WORLD NATION A COMING
1% own 21% of our wealth
10% own 71%
Wall Street Gamblers own America.
Buy/Sell large corporations like baseball card trading
Labor unimportant
America unimportant
$$$$$$$$$$$$$$$$$$$$$ King of the Street
TRIPLE A
anti-christ
anti-america
anti-world
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
first always
cswinney2@triad.rr.com
July 23rd, 2009 at 1:15 pmUS Bureau of Labor Statics says “Top executives held about 2.1 million jobs in 2006″ and highest total employed persons in 2006 as 146 million. So roughly 1.5% of the total workforce. Basically the the 1 percenters.
http://www.bls.gov/oco/ocos012.htm
July 23rd, 2009 at 2:25 pmThe US Bureau of Labor Statistics measured “Top Executives”, the article cited “all executives”, which the US Bureau of Labor Statistics chart shows to be just shy of 5%.
Something else unfair about this article is that minimum wage hourly workers were included in the statistics, yet this is a job regularly held by young people who often are not supporting anyone but themselves, and sometimes are having assistance from parents in their own support.
Another problem in the report is that some of these highly paid executives are small business owners who are taking business profits in the form of income. I think profits generated by one’s business are a far cry different than getting fat paychecks as the executive of a public company, yet small business executives are included in these numbers.
In all, hard work and education are the simple keys any of us can use to get to be one of the haves instead of the have-nots.
July 25th, 2009 at 11:27 am