CEO PAY TAKES OFF: Overall, American workers saw a wage increase of just 2.5 percent in 2004 (prices rose 2.7 percent), but never fear, the drag didn't extend to our nation's multi-millionaire CEOs.
According to a study commissioned by the Wall Street Journal, "the
median salary and bonus for chief executives in office at least two
years soared 14.5% last year to $2,470,600." The cash-compensation
upsurge is "the biggest since the study began in 1989."
Meanwhile, paychecks of nonunion salaried staffers in corporate America
went up 3.4 percent, "the smallest rise since the Mercer study's 1989
debut."
OIL COMPANY RAKES IN PROFITS: Another place Americans have felt the squeeze this year has been at the pump, where gas prices hit a record high for the fourth week in a row this week. Research shows CEOs of oil companies were, as a group, the highest paid executives in 2004, raking in a median compensation package – not including potentially lucrative gains from stock options – of $16.6 million. That was a gain of 109 percent over the previous year. Surely, Americans will be happy to know they are subsidizing such profits when they shell out an average of $2.28 per gallon for gas this week. The price is up 49 cents from a year ago.
(IM)PERFECT STORM: As CEO pay soars, American workers continue to be pummeled by "something of a perfect storm of economic forces." While pay rose only 2.5 percent last year, high housing costs, rising health insurance premiums and skyrocketing energy prices have all taken their toll on the finances of American workers, especially the working poor. "For lower-income workers, who are more likely to be uninsured, the falling value of their wages is even more serious because they're more likely to live paycheck to paycheck. And rising food and energy prices take a proportionately higher toll on the poor than on the rich."
THE HEALTH CARE SQUEEZE: The economic squeeze is "especially intense on the 47% of the workforce whose employers don't directly provide their health insurance." A study by AARP showed wholesale prices for popular brand-name prescription drugs rose by an average 7.1 percent in 2004, "more than twice the general inflation rate." AARP CEO Bill Novelli "called the increases disappointing, particularly in the year after President Bush signed a sweeping overhaul of Medicare." Bush's plan, which AARP originally supported, "prohibits the government from negotiating drug prices on behalf of consumers."
WAGE INCREASE GAP: Not all Americans will share the burden of the wage decrease equally. The New York Times reports, "the overall wage figures hide a split, with an elite group getting relatively large gains." In a study of census data, the Economic Policy Institute (EPI)
found that "for the bottom 95 percent of workers, after-inflation wages
were flat or down in 2003 and 2004, but for the top 5 percent, wages
rose by an average of 1 percent, with some gaining much more. The
upper-income group enjoyed strong pay increases largely because of
bonuses, stock options and other inducements." Corporate America was
also helped out by hidden tax breaks from the Bush administration.