Executive Pay Soars, Not Anybody Else's

Via Mark Thoma, the NYT:

After shrinking during the 2008-9 recession, paychecks for top American executives are growing again — in many cases, significantly so.
Rarely has the view from the corner office seemed so at odds with the view from the street corner. At a time when millions of Americans are trying to hang on to homes and millions more are trying to hang on to jobs, the chief executives of major corporations like 3M, General Electric and Cisco Systems are making as much today as they were before the recession hit. Indeed, some are making even more.
The disparity is especially stark as companies are swimming in cash. In the fourth quarter, profits at American businesses were up an astounding 29.2 percent, the fastest growth in more than 60 years. Collectively, American corporations logged profits at an annual rate of $1.678 trillion.

So far, this recovery has not trickled down. After two relatively lean years, C.E.O.’s in finance, technology, energy and beyond are pulling down multimillion-dollar paychecks. What many of these executives aren’t doing, however, is hiring. Unemployment, although down from its peak, stood at 8.8 percent in March. And few economists predict the jobless rate will drop substantially anytime soon.

Guess what, it won't trickle down.  The theory of trickle-down economics is the biggest con in history.  These asses are arrogant enough to think they deserve the pay.  They don't.  I was recently reading Traitor to His Class, by H.W. Brands.  It is a great biography of FDR.  One of the most notable things to me was that trickle down economics was the M.O. of Calvin Coolidge and Republican Party of the 1920's.  In his 1932 Convention acceptance speech, FDR says:

There are two ways of viewing the Government's duty in matters affecting economic and social life. The first sees to it that a favored few are helped and hopes that some of their prosperity will leak through, sift through, to labor, to the farmer, to the small business man. That theory belongs to the party of Toryism, and I had hoped that most of the Tories left this country in 1776 ....

In the years before 1929 we know that this country had completed a vast cycle of building and inflation; for ten years we expanded on the theory of repairing the wastes of the War, but actually expanding far beyond that, and also beyond our natural and normal growth. Now it is worth remembering, and the cold figures of finance prove it, that during that time there was little or no drop in the prices that the consumer had to pay, although those same figures proved that the cost of production fell very greatly; corporate profit resulting from this period was enormous; at the same time little of that profit was devoted to the reduction of prices. The consumer was forgotten. Very little of it went into increased wages; the worker was forgotten, and by no means an adequate proportion was even paid out in dividends--the stockholder was forgotten.
And, incidentally, very little of it was taken by taxation to the beneficent Government of those years.

What was the result? Enormous corporate surpluses piled up-- the most stupendous in history. Where, under the spell of delirious speculation, did those surpluses go? Let us talk economics that the figures prove and that we can understand. Why, they went chiefly in two directions: first, into new and unnecessary plants which now stand stark and idle; and second, into the call-money market of Wall Street, either directly by the corporations, or indirectly through the banks. Those are the facts. Why blink at them?

Then came the crash. You know the story. Surpluses invested in unnecessary plants became idle. Men lost their jobs; purchasing power dried up; banks became frightened and started calling loans. Those who had money were afraid to part with it. Credit contracted. Industry stopped. Commerce declined, and unemployment mounted.

And there we are today.

Now that is something we can relate to.  It amazes me that Republicans have reverted back to their policies of the 20's, with the exact same result.  The difference for the country is that too many people can't see how embarrassingly wrong the Republicans and their policies are.  Bring back higher marginal tax rates.  These executives don't earn these salaries.  It is only by Republican policies that they get them.  I recently saw a graphic showing the top executive pay, from the 1920's, from 1933 until the 1970's, and the pre-crash period in the 2000's.  The pay after 1933 was under control, until Republicans started cutting taxes with the promises that wealth would trickle down.  It hasn't.  Hopefully I can find that.  It is extremely interesting.