EDITORIAL Executive pay, worker wages out of
balance
Asgr. George Higgins, the labor
priest, once told a reporter he believed labor unions would ultimately survive
because people need to organize.
No greater proof of the need to organize exists than the current
economics landscape and the growing awareness that the economic growth heralded
day after day is not evenly distributed.
In their 1999 Labor Day Statement, the countrys Catholic
bishops write:
On this Labor Day Americans have much to be grateful for:
economic freedom, low inflation and economic growth. But our prosperity is not
being widely shared. Too many have been left behind and the gap in family
income continues to widen. The top 5 percent of the population takes a larger
share of personal income today than similar people did 30 years ago (a 16
percent share in 1968, 24 percent in 1996). While the share of income going to
people in the middle 60 percent has declined by nearly 10 percent over the same
period. The decline is even sharper for those in the bottom 20 percent. This
trend is part of the reason why we need a strong, active, democratic labor
movement.
The simple fact, caught eloquently in a centurys worth of
church social teaching, is that those in the middle or at the bottom of the
economic ladder have the same human yearning for -- and right to -- economic
security as those at the top.
No one in U.S. Catholic circles knows that better today than
Higgins, who has worked tirelessly on behalf of labor, and we are delighted to
carry more of his words on our pages. It
is heartening to hear of new signs of vitality among the labor movement, which
has taken considerable steps in recent years to clean up its act.
When their wages stagnate while their companies prosper,
working people are told that their effort and skill arent valued,
Higgins said. And, when health care and pensions are cut back, working
people are told that nobody cares what happens when they get sick or grow
old.
Thats not the language -- nor the concern -- of the
nations popular money shows and magazines. The news outlets that
endlessly tout the robust nature of the U.S. economy and the
limitless potential of globalization are not likely to peer closely at the
realities that give the lie to such analyses.
There is, indeed, a casualness to todays cruelties, a kind
of easy acceptance of the inordinate and still growing gaps between rich and
poor.
One of the best illustrations of that growing distance is the gap
between executive pay and worker pay. The Institute for Policy Studies and the
group called United for a Fair Economy, in a recent study, A Decade of
Executive Excess: the 1990s, report that in 1980, the average CEO was
paid as much as 42 factory workers; in 1998, as much as 419 workers.
According to the report, the sixth of its kind, corporate profits
rose 108 percent during the 1990s. In that period, worker pay rose 28 percent,
before adjusting for inflation, while CEO pay rose 481 percent.
If average production worker pay had risen at the same rate
as CEO pay during he same period, worker pay would be $110,399
today, rather than the current $29,276, according to the report.
The minimum wage would be $22.08, rather than the current $5.15 an
hour. Pay packages for U.S. executives were way out of proportion to
their counterparts throughout the rest of the industrialized world. Further,
many who have enjoyed exorbitant compensation have earned their money heading
companies involved in illegal behavior, worker exploitation and the marketing
of such products as cigarettes.
Of course, wishing for an absolutely level playing field is not
only unrealistic but probably unwise. However, it is dangerous to continue on a
course where wages and expectations and, in the end, a sense of security, are
so wildly out of balance. The only chance for a wide and lasting remedy is
strong unions and access to collective bargaining.
National Catholic Reporter, September 3,
1999
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