Sunday, January 29, 2006

screw the workers

Ben Stein today rips United Airline management. After imposing huge pay and pension cuts on UAL employees, they are ready to bring United out of bankruptcy and to sell stock expected to raise $6 billion or so. And management asked the bankruptcy court to let them keep $900 million of that $6 billion for themselves. CEO Glenn Tilton himself would get $80 million. The bankruptcy court "only" approved half of that gift that management proposed to give itself.

Stein is rightly outraged. UAL employees were the OWNERS of United. Tilton & Company were suppost to manage the company for THEM. So the OWNERS/EMPLOYEES get wiped out and Tilton's crew has hundreds of millions of dollars rained down upon them?

Stein notes this is not the only case of such corporate looting. "Management is using competition, higher fuel costs and every other cost complaint to cut the pay and pensions of its own employees while enriching itself."

Meanwhile, remember that CEOs are in enviable positions -- they get to choose the people who will decide how much they will be paid. And when they claim it is all performance-related, don't buy it. As one researcher points out, CEO pay went up 30% last year. Did you see a 30% improvement overall in corporate management? Of course not.

The rich get richer ever more rapidly, and the poor just wish we could get the minimum wage up to $8 or so... Some radical-free-market types bitch that a minimum wage constitutes a "tax" on labor that will cause less labor to be used. Bad parallel -- yes, if the price of wood goes up, companies will lose less. But "labor" doesn't just take in money, it also SPENDS it -- in other words, minimum wage people are also consumers. And even the CEO of WAL-MART (the nation's biggest employer of minimum-wage folks) thinks Congress should raise the minimum wage:
"The U.S. minimum wage of $5.15 an hour has not been raised in nearly a decade and we believe it is out of date with the times. We can see first-hand at Wal-Mart how many of our customers are struggling to get by. Our customers simply don't have the money to buy basic necessities between pay checks."
Growing income inequality and the looting of corporations at the expense of employees and even stockholders. Another step on the road to being a true banana republic. Bush's America.