By Sam Pizzigati
Editor, Too Much online magazine
Some of today’s most greedy are running giant multinationals. Some are just running their mouths. Their stories remind us just how much needs to change, economically and politically, in the year ahead.
The essence of greed? Simple. Greed amounts to taking more than you need when you already have enough — and others don’t. Who among us, by this yardstick, rate as our greediest? Those greediest would be those who have the wherewithal to take whatever they want — and deny others the basics they need.
We abound in these greedy. Most of them wear power suits and dart in and out of the executive suites that sit high atop America’s most elegant corporate towers. Year in and year out, these greedy grab ungodly rewards for their own labor — and deny their employees anything close to decent compensation for theirs.
The Institute for Policy Studies weekly on excess and inequality, Too Much, has been compiling lists of America’s most greedy grabbers since the Great Recession first hit in 2008. This fifth annual Too Much list of our greediest showcases those ten deep pockets who’ve done the most in 2012 to subvert the decency we all like to call, at this time of year, the “holiday spirit.”
10/ Jack Welch: Comforting Comfortables
An oversized ego can be a terrible thing to waste. Jack Welch, the retired General Electric CEO, is doing his best not to waste a bit of his — and pick up a few extras pennies in the process.
Welch, the super CEO of the 1990s, has become a regular on the corporate chattering circuit since he retired in 2001. He collects a sweet $150,000 per appearance.
Not that Welch needs any more money. He left GE with a retirement package worth over $400 million and now divides his time between très chic abodes in Manhattan, Nantucket, and Florida’s North Palm Beach, lapping up luxury while he plots his next moves to protect plutocracy.
Welch particularly enjoys going after Warren Buffett, the billionaire who publicly acknowledges that he and his fellow rich don’t pay nearly enough in taxes. Countered Welch earlier this year: “I don’t feel undertaxed in any way at all.”
Some had hoped that Welch’s retirement would end the actual social damage he could wreak. A reasonable hope. At General Electric, Welch had the power to do everything from nuke 100,000 GE worker jobs to foul the Hudson River with toxic waste. Without that power, what damage could he do? Plenty, turns out.
Much of that damage comes from the wealth of tax-dodging expertise Welch bequeathed his successors at General Electric. In the decade since 2001, one report released this year revealed, GE paid only 1.8 percent of its $80.2 billion overall profits in federal income taxes.
9/ Jamie Dimon: Pounding Reformers
The European Union has just taken a fairly significant step toward limiting excessive banker compensation. Under proposed new rules up for a vote early in 2013, European bankers won’t be able to pocket bonuses greater than twice their straight salary.
Better not try that in the United States, Jamie Dimon — America’s highest-paid bank CEO in 2011 — warned last week. Any limits on Wall Street pay, JPMorgan Chase CEO Dimon intoned, will end freedom as we know it.
“If you don’t want a free society,” Dimon pronounced, “then start dictating what compensation can be.”
And besides, the JPMorgan chief added, any attempt to limit pay would chase talent out of America’s financial system. The banking business, he explained, simply “cannot run” on “second-rate talent.”
For his own presumably “first-rate” talent, Dimon pulled in $23.1 million in 2011, up 11 percent over 2010. The highlight of his first-rate stewardship: JPMorgan suffered a $2 billion trading loss after a bank management blunder that Dimon admitted this past spring he could not “publicly defend.”
That admission left some observers wondering how much the bank would have lost with a second-rate talent in charge.
Dimon hasn’t let JPMorgan’s debacle with risky trades slow his charge against the Dodd-Frank Act, the legislation enacted in 2010 to rein in risky trading after the 2008 Wall Street meltdown. Wall Street’s intense opposition to Dodd-Frank, with Dimon a key ringleader, has so far kept the bulk of the legislation unenforced.
8/ Wilbur Ross: Exploiting the Bankrupt
Remember the bank bailout? Private equity kingpin Wilbur Ross surely does. He spent a chunk of the past year trolling for windfalls on the busted-bank landscape — and found a hot prospect in Ohio. In October, he cut a dealto pick up the troubled First Place Financial at just $45 million.
U.S. Treasury officials balked at the deal. The bank, they complained to the courts, had borrowed $72.9 million from the federal bailout program three years earlier and not yet repaid any of the money.
The deal with Ross would likely “chill bidding” for the bank, federal officials pointed out, and cost taxpayers millions.
Not my problem, retorted Ross. So things might not “work out well” for taxpayers? “Unfortunate,” said Ross. Two months later, the Treasury prediction came true. No other bidders for the bank stepped up, and Ross had another notch in his “vulture investing” belt.
Ross has specialized for decades on buying up companies in or near bankruptcy, then “flipping” them for big profits. The secret to his success: Bankrupt companies can dump their liabilities — like mandates to fund pension plans. Ross has followed this flipping formula to fortune in steel, textiles, and coal. His latest estimated personal net worth: $2.3 billion.
In October, Ross celebrated his fabulous stash with a fundraising dinner at his Florida mansion for GOP Presidential candidate Mitt Romney. The fee to join him: $50,000 a plate. About 150 people, reports the Palm Beach Post, attended.
7/ Samuel Palmisano: Busting Nest Eggs
IBM, the world’s first computer giant, now has just 92,000 employees stateside, down from 160,000 back in 2002, the year Sam Palmisano took up the IBM CEO reins.
Palmisano stepped down as chief exec last year and retired as the chairman of IBM’s board at the start of this month, but not before green-lighting a change in the IBM 401(k) plan that sets a damaging precedent for millions of Americans outside the IBM ranks.
Up until now, IBM has been matching employee contributions to 401(k)s on a semi-monthly basis. Starting in 2013, IBM will make only one match a year, on December 31. Workers who leave IBM’s employ next December 15 will get no IBM match to their 401(k) for the entire year, even if they were laid off or had to leave because of a disability.
No major U.S. corporation currently short-changes workers through this sort of maneuver. A good many other large corporations “will be looking very closely” at the IBM move, says Brooks Herman of Brightscope, a financial info firm. If they follow IBM’s lead, notes Reuters, working families throughout America will find it “very difficult to build significant nest eggs through the 401(k) system.”
Sam Palmisano doesn’t have to worry about his nest egg. He’s walking out the door with a package of retirement, bonus, and assorted other benefits one analysis values at $224.7 million.
Palmisano isn’t actually walking out the door. He’ll be consulting for IBM. His rate: $20,000 for any day he puts in four hours. In 2013, observes the Wall Street Journal, Palmisano “could pocket $400,000” for a mere “20 half-days of work.” (more…)