Welcome to DU!
The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards.
Join the community:
Create a free account
Support DU (and get rid of ads!):
Become a Star Member
Latest Breaking News
General Discussion
The DU Lounge
All Forums
Issue Forums
Culture Forums
Alliance Forums
Region Forums
Support Forums
Help & Search
Why Can't We Fix Outrageous CEO Pay?
http://www.alternet.org/economy/ceo-pay-and-dodd-frank
In theory, a new proposal from the Securities and Exchange Commission would require CEOs to disclose not only how much they make, but how that sum compares to the average worker. In practice, however, don't hold your breath.
A total lack of clear methodology in how exactly companies are meant to calculate this figure gives corporations a blank check to come up with any figure they want. What turned a measure meant to increase transparency and accountability into yet one more way for corporations to obscure truth and cast illusions? A deep and abiding concern on the part of the SEC that following this rule not be too expensive for multibillion dollar corporations. Why are we not surprised?
While, yes, the CEO definitely makes more than you, the question of just how much more is set to become a matter of public record. Three years ago, the Securities and Exchange Commission (SEC) was charged with drafting a rule that, as part of the Dodd-Frank Act, would require public companies to disclose the total annual compensation of their CEO, the median total annual compensation of the remaining employees, and the ratio between the two. This is, presumably, to increase financial transparency and highlight the growth of an already hideous inequality between well-heeled executives and the average worker, without whom no wealth would be generated at all. Sounds good, right?
On Sept. 18, the SEC released its draft proposal on how exactly companies would go about disclosing this and the result is a vague, toothless, broad-as-the-universe mess than is so ineffective and counter to the legislation’s original intention that it’s insulting. Given the task of creating a rule to increase transparency and highlight inequality, the SEC has instead given us a regulation-in-name-only proposal that doesn’t so much have loopholes but is instead composed almost entirely of them. What, exactly, is wrong? Let SEC Chair Mary Jo White, in her statement about the proposal, lay it out for you:
