Abortion v. Supporting the poor, the criminals, the immigrants, and the environment

Who Will Protect Catholics from Rick Santorum?

By Regina Small | February 7, 2012 LINK

The Awl

Rick Santorum, eager to show that he will stand up for Catholic values, has been saying things about the recent Health and Human Services regulation that now requires Catholic universities and hospitals to provide access to contraception and the morning-after pill. Santorum has accused the Obama administration of being "hostile to people of faith, particularly Christians and specifically Catholics.” He's even gone so far as to vow that he "will make it an issue every day of this campaign," until the Obama administration reinstates conscience protections. Santorum has also spoken up forcefully against same-sex marriage, which the Pope has—yes, again—recently condemned (in some really extreme terms, too).

Santorum further complained that "[The current administration] are folks who are trying to use their power to force people to do things that they believe they should do and are right. They don’t care about their religion."

But you know who does care about religion? Rick Santorum! In fact, let's take a look at how most of Rick Santorum's stated political views are truly representative of the Catholic Church and Catholic voters!

On man-made climate change:

"I for one never bought the hoax. I for one understood just from science, there are 100 factors that influence the climate, to suggest one minor factor of which man’s contribution is a minor factor.... And yet we have politicians running to the ramparts, unfortunately politicians that happen to be running for the Republican nomination of the president who buy into manmade global and bought into cap and trade. Congressman Gingrich and Gov. Romney both supported the idea of manmade global warming and in fact cap and trade; I never did. And unless the science is such that it is a heck of a lot better than what we see today, I won’t.” —Rick Santorum

"I hope that all members of the international community can agree on a responsible, credible and supportive response to this worrisome and complex phenomenon, keeping in mind the needs of the poorest populations and of future generations....In fact, it is by now evident that there is no good future for humanity or for the earth unless we educate everyone toward a style of life that is more responsible toward the created world." Pope Benedict XVI

On intelligent design:

"Well maybe the science points to the fact that maybe science doesn't explain all these things. And if it does point to that, then why don't you pursue that? But you can't, because it's not science, but if science is pointing you there how can you say it's not science? It's worth the debate." — -Rick Santorum

"If the model proposed by Darwin is held to be inadequate, one should look for another model. But it is not correct methodology to stray from the field of science pretending to do science...Intelligent design does not belong to science and there is no justification for the pretext that it be taught as a scientific theory alongside the Darwinian explanation." — -L'Osservatore Romano, the Vatican newspaper.

On the death penalty:

"When there is certainty, that's the case that capital punishment can be used. If there is not certainty, under the law, it shouldn't be used." —Rick Santorum

"There is no room for supporting the death penalty in today's world." — -Tommaso Di Ruzza, desk officer at the Vatican's Pontifical Council for Justice and Peace.

and

Addressing the Sant’Egidio Community in Rome on November 30th, 2011: Pope Benedict XVI stated that he hoped their discussions (organized under the theme "No Justice Without Life") "will encourage the political and legislative initiatives being promoted in a growing number of countries to eliminate the death penalty.”

On illegal immigrants:

"You can't be here for 20 years and commit only one illegal act ... because everything you're doing while you're here is against the law....I understand Congressman Gingrich saying, 'Well, you know, people have been here and they've been good citizens and paying taxes.' Yeah, under somebody else's Social Security number because you stole it." —Rick Santorum

"The Catholic Church’s approach to immigration is not about politics or economics. It is rooted in the vision of human society that was taught to us by Jesus Christ. The Catholic Church, from the time of the first Pentecost, has been a family of nations. By definition, the Catholic Church is universal, one family of God drawn from all nations, peoples, and languages....The point is that in the Catholic Church and in the eyes of God, no one is a stranger or an alien. As a pastor, I am deeply concerned about the costs of this impasse in the lives of millions of men, women, and children. Not just the souls of the 12 million without papers who are living at the margins of our society. I am worried about their physical, moral, and spiritual health. When you are a stranger in a strange land — and unwanted — you are easy prey for exploitation. But more than that. When you are a stranger who is despised, it gets harder every day to hold onto your cultural identity, your moral compass, your religion, your dignity. You start to believe what people say about you — that you are no good." —Archbishop Jose H. Gomez

On diplomatic relations with Iran:

"I would be saying to the Iranians, you either open up those facilities, you begin to dismantle them and make them available to inspectors, or we will degrade those facilities through air strikes." —Rick Santorum

"Vatican officials have said privately that on the question of Iran the Holy See supports the position of the IAEA, which has called on Iran to suspend its uranium enrichment program, allow more international inspections and work more cooperatively with the international community to certify that its nuclear development is strictly for peaceful purposes. The officials have also said the Vatican would view outside military intervention in Iran as morally unjustifiable and impractical." —Catholic News Service Report

On poverty:

"I don't want to make [black or possibly 'blah'] people's lives better by giving them somebody else's money. I want to give them the opportunity to go out and earn the money and provide for themselves and their families." —Rick Santorum

"We've gotta block-grant [food stamps] and send it back to the states, just like I did with welfare reform — do the same thing with Medicaid, including housing programs, block-grant them, send them back to the states, require work, and you put a time limit on it....We'll help take these programs, which are now dependencies, and you help people move out of poverty." —Rick Santorum

"We remind Mr. Gingrich and Mr. Santorum that Catholic bishops describe racism as an 'intrinsic evil' and consistently defend vital government programs such as food stamps and unemployment benefits that help struggling Americans. At a time when nearly 1 in 6 Americans live in poverty, charities and the free market alone can’t address the urgent needs of our most vulnerable neighbors. And while jobseekers outnumber job openings 4-to-1, suggesting that the unemployed would rather collect benefits than work is misleading and insulting." —Letter signed by over 40 Catholic leaders and theologians.

So: Rick Santorum is succeeding in standing up for two stated values of the Catholic Church, while ignoring or outright contradicting most of Catholic social teaching. Is it that these two issues (reproductive freedom, same-sex marriage) actually weigh more heavily in the minds of Catholic voters? Is that why Santorum feels so comfortable identifying as a Catholic politician? Or does the prominence of these two issues in the public discourse about Catholicism have more to do with the Church's inability to communicate its message about social responsibility and diplomacy? HEAVY QUESTIONS. What we do know is in 2008, 52% of Catholic voters cast their ballots in favor of Barack Obama, a pro-choice candidate, maybe in part because his campaign was more in line with the vast majority of the issues outlined here—in a way Santorum's isn't and likely never will be. If Santorum wants to protect the Catholic conscience, it might benefit him to think about what the Catholic conscience actually is.

AZ Legislature and the New Testament

Thou shalt take your Bible class

by E. J. Montini - Feb. 5, 2012 12:00 AM
The Arizona Republic

An Arizona legislative committee last week approved a bill to create an elective high-school class called "The Bible and its Influence on Western Culture," a divinely inspired proposal that needs only two minor changes.

First, the class should not be elective but mandatory. Second, it should not be taught to high-school students but to legislators.

Can I get an "Amen!"?

Given their behavior, Arizona lawmakers must have been absent at Sunday school when a few relatively important topics came up.

For example, caring for their fellow man. Remember how legislators refused to extend unemployment benefits to Arizona men and women who had been out of work for a long time even though the money would have come from the federal government?

Would they have done that if they were familiar with a Bible passage like Acts 20:35? It says, "In all things I have shown you that by working hard in this way we must help the weak and remember the words of the Lord Jesus, how he himself said, 'It is more blessed to give than to receive.' "

Likewise, would they continue giving tax breaks to the wealthiest among us if they were familiar with 1 Timothy 6:17? That's a passage reading, "Tell those who are rich not to be proud and not to trust their money, which will soon be gone, but their pride and trust should be in the living God who always richly gives us all we need for our enjoyment."

In fact, lawmakers might actually start thinking more about the underprivileged than the wealthy if they were familiar with Proverbs 19:17, which says, "Whoever is generous to the poor lends to the Lord, and he will repay him for his deed."

And citizens like us might not have to worry about the influence of highly paid lobbyists working for special interests if our politicians were familiar with Matthew 6:24, which reads, "No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money."

Would our lawmakers cut or limit health care for children if they'd studied Mark 10:14? It says, "But when Jesus saw (it), he was much displeased, and said unto them, 'Suffer the little children to come unto me, and forbid them not: for of such is the kingdom of God.' "

Would there have been a Fiesta Bowl scandal if they were familiar with Proverbs 16:19? It tells us, "Better it is to be of a humble spirit with the lowly, than to divide the spoil with the proud."

Would they wage war against police and firefighters and try to deny their rights to bargain collectively if they'd been at Sunday School during the discussion of Isaiah 10:1-2? It reads, "Woe to those who make unjust laws, to those who issue oppressive decrees, to deprive the poor of their rights and withhold justice from the oppressed of my people. ... "

Or to Proverbs 22:16, which reads, "He that oppresseth the poor to increase his riches, and he that giveth to the rich, shall surely come to want."

Would we have all the ugly negative campaigning in every election if our politicians read Matthew 5:5? It reminds us: "Blessed are the meek: for they shall inherit the earth."

Nor would candidates trash one another if they had any understanding of Matthew 23:12, which says, "And whosoever shall exalt himself shall be abased; and he that shall humble himself shall be exalted."

For these reasons and many more the state must create a Bible class and require elected officials to take it. After the final exam -- assuming any of them pass -- we could present each lawmaker with a plaque that will have on it this quote from Galatians 6:3:

"For if a man think himself to be something, when he is nothing, he deceiveth himself."

Reach Montini at 602-444-8978 or ed.montini@arizonarepublic.com.

A cure-all: Strengthen Middle Class

OPINION

Jobs Will Follow a Strengthening of the Middle Class

Bill Marsh/The New York Times
Sources: Robert B. Reich, University of California, Berkeley; "The State of Working America" by the Economic Policy Institute; Thomas Piketty, Paris School of Economics, and Emmanuel Saez, University of California, Berkeley; Census Bureau; Bureau of Labor Statistics; Federal Reserve

By ROBERT B. REICH

Published: September 04, 2011 LINK

Robert B. Reich is the former secretary of labor, a professor at the University of California, Berkeley, and the author of "Aftershock: The Next Economy and America's Future."

THE 5 percent of Americans with the highest incomes now account for 37 percent of all consumer purchases, according to the latest research from Moody's Analytics. That should come as no surprise. Our society has become more and more unequal.

When so much income goes to the top, the middle class doesn't have enough purchasing power to keep the economy going without sinking ever more deeply into debt - which, as we've seen, ends badly. An economy so dependent on the spending of a few is also prone to great booms and busts. The rich splurge and speculate when their savings are doing well. But when the values of their assets tumble, they pull back. That can lead to wild gyrations. Sound familiar?

The economy won't really bounce back until America's surge toward inequality is reversed. Even if by some miracle President Obama gets support for a second big stimulus while Ben S. Bernanke's Fed keeps interest rates near zero, neither will do the trick without a middle class capable of spending. Pump-priming works only when a well contains enough water.

Look back over the last hundred years and you'll see the pattern. During periods when the very rich took home a much smaller proportion of total income - as in the Great Prosperity between 1947 and 1977 - the nation as a whole grew faster and median wages surged. We created a virtuous cycle in which an ever growing middle class had the ability to consume more goods and services, which created more and better jobs, thereby stoking demand. The rising tide did in fact lift all boats.

During periods when the very rich took home a larger proportion - as between 1918 and 1933, and in the Great Regression from 1981 to the present day - growth slowed, median wages stagnated and we suffered giant downturns. It's no mere coincidence that over the last century the top earners' share of the nation's total income peaked in 1928 and 2007 - the two years just preceding the biggest downturns.

Starting in the late 1970s, the middle class began to weaken. Although productivity continued to grow and the economy continued to expand, wages began flattening in the 1970s because new technologies - container ships, satellite communications, eventually computers and the Internet - started to undermine any American job that could be automated or done more cheaply abroad. The same technologies bestowed ever larger rewards on people who could use them to innovate and solve problems. Some were product entrepreneurs; a growing number were financial entrepreneurs. The pay of graduates of prestigious colleges and M.B.A. programs - the "talent" who reached the pinnacles of power in executive suites and on Wall Street - soared.

The middle class nonetheless continued to spend, at first enabled by the flow of women into the work force. (In the 1960s only 12 percent of married women with young children were working for pay; by the late 1990s, 55 percent were.) When that way of life stopped generating enough income, Americans went deeper into debt. From the late 1990s to 2007, the typical household debt grew by a third. As long as housing values continued to rise it seemed a painless way to get additional money.

Eventually, of course, the bubble burst. That ended the middle class's remarkable ability to keep spending in the face of near stagnant wages. The puzzle is why so little has been done in the last 40 years to help deal with the subversion of the economic power of the middle class. With the continued gains from economic growth, the nation could have enabled more people to become problem solvers and innovators - through early childhood education, better public schools, expanded access to higher education and more efficient public transportation.

We might have enlarged safety nets - by having unemployment insurance cover part-time work, by giving transition assistance to move to new jobs in new locations, by creating insurance for communities that lost a major employer. And we could have made Medicare available to anyone.

Big companies could have been required to pay severance to American workers they let go and train them for new jobs. The minimum wage could have been pegged at half the median wage, and we could have insisted that the foreign nations we trade with do the same, so that all citizens could share in gains from trade.

We could have raised taxes on the rich and cut them for poorer Americans.

But starting in the late 1970s, and with increasing fervor over the next three decades, government did just the opposite. It deregulated and privatized. It cut spending on infrastructure as a percentage of the national economy and shifted more of the costs of public higher education to families. It shredded safety nets. (Only 27 percent of the unemployed are covered by unemployment insurance.) And it allowed companies to bust unions and threaten employees who tried to organize. Fewer than 8 percent of private-sector workers are unionized.

More generally, it stood by as big American companies became global companies with no more loyalty to the United States than a GPS satellite. Meanwhile, the top income tax rate was halved to 35 percent and many of the nation's richest were allowed to treat their income as capital gains subject to no more than 15 percent tax. Inheritance taxes that affected only the topmost 1.5 percent of earners were sliced. Yet at the same time sales and payroll taxes - both taking a bigger chunk out of modest paychecks - were increased.

Most telling of all, Washington deregulated Wall Street while insuring it against major losses. In so doing, it allowed finance - which until then had been the servant of American industry - to become its master, demanding short-term profits over long-term growth and raking in an ever larger portion of the nation's profits. By 2007, financial companies accounted for over 40 percent of American corporate profits and almost as great a percentage of pay, up from 10 percent during the Great Prosperity.

Some say the regressive lurch occurred because Americans lost confidence in government. But this argument has cause and effect backward. The tax revolts that thundered across America starting in the late 1970s were not so much ideological revolts against government - Americans still wanted all the government services they had before, and then some - as against paying more taxes on incomes that had stagnated. Inevitably, government services deteriorated and government deficits exploded, confirming the public's growing cynicism about government's doing anything right.

Some say we couldn't have reversed the consequences of globalization and technological change. Yet the experiences of other nations, like Germany, suggest otherwise. Germany has grown faster than the United States for the last 15 years, and the gains have been more widely spread. While Americans' average hourly pay has risen only 6 percent since 1985, adjusted for inflation, German workers' pay has risen almost 30 percent. At the same time, the top 1 percent of German households now take home about 11 percent of all income - about the same as in 1970. And although in the last months Germany has been hit by the debt crisis of its neighbors, its unemployment is still below where it was when the financial crisis started in 2007.

How has Germany done it? Mainly by focusing like a laser on education (German math scores continue to extend their lead over American), and by maintaining strong labor unions.

THE real reason for America's Great Regression was political. As income and wealth became more concentrated in fewer hands, American politics reverted to what Marriner S. Eccles, a former chairman of the Federal Reserve, described in the 1920s, when people "with great economic power had an undue influence in making the rules of the economic game." With hefty campaign contributions and platoons of lobbyists and public relations spinners, America's executive class has gained lower tax rates while resisting reforms that would spread the gains from growth.

Yet the rich are now being bitten by their own success. Those at the top would be better off with a smaller share of a rapidly growing economy than a large share of one that's almost dead in the water.

The economy cannot possibly get out of its current doldrums without a strategy to revive the purchasing power of America's vast middle class. The spending of the richest 5 percent alone will not lead to a virtuous cycle of more jobs and higher living standards. Nor can we rely on exports to fill the gap. It is impossible for every large economy, including the United States, to become a net exporter.

Reviving the middle class requires that we reverse the nation's decades-long trend toward widening inequality. This is possible notwithstanding the political power of the executive class. So many people are now being hit by job losses, sagging incomes and declining home values that Americans could be mobilized.

Moreover, an economy is not a zero-sum game. Even the executive class has an enlightened self-interest in reversing the trend; just as a rising tide lifts all boats, the ebbing tide is now threatening to beach many of the yachts. The question is whether, and when, we will summon the political will. We have summoned it before in even bleaker times.

As the historian James Truslow Adams defined the American Dream when he coined the term at the depths of the Great Depression, what we seek is "a land in which life should be better and richer and fuller for everyone."

That dream is still within our grasp.

Richer get larger slice

In 2000, the richest 20% of Americans had 6% more of the pie since Ronald Reagan took office. Both the poorest 20% and the middle 20% saw cuts in that 20 year span.

Share of Total Household Income by Year and Social Class

1980 2000

Upper class 43.7% 49.6%

Middle class 16.9% 14.8%

Lower class 4.3% 3.6%

Source: 2000 U.S. Census Money Income in the United States: 2000

Social Security is safe for 26 years

Before Social Security 50% of seniors lived in poverty. Anyone who says SS contributes to the deficit is lying. SS has a 2.6 trillion dollar surplus. It can pay out every dime that is owed for the next 26 years. If you wanna talk about the deficit talk about the wars. Talk about tax breaks for billionaires. Talk about the wall street bailout. Don't talk about social security.

- Bernie Sanders

Video of Speech here

Richer getting really rich

With executive pay, rich pull away from rest of America

By Peter Whoriskey, Published: June 18 LINK

The Washington Post

It was the 1970s, and the chief executive of a leading U.S. dairy company, Kenneth J. Douglas, lived the good life. He earned the equivalent of about $1 million today. He and his family moved from a three-bedroom home to a four-bedroom home, about a half-mile away, in River Forest, Ill., an upscale Chicago suburb. He joined a country club. The company gave him a Cadillac. The money was good enough, in fact, that he sometimes turned down raises. He said making too much was bad for morale.

Forty years later, the trappings at the top of Dean Foods, as at most U.S. big companies, are more lavish. The current chief executive, Gregg L. Engles, averages 10 times as much in compensation as Douglas did, or about $10 million in a typical year. He owns a $6 million home in an elite suburb of Dallas and 64 acres near Vail, Colo., an area he frequently visits. He belongs to as many as four golf clubs at a time — two in Texas and two in Colorado. While Douglas’s office sat on the second floor of a milk distribution center, Engles’s stylish new headquarters occupies the top nine floors of a 41-story Dallas office tower. When Engles leaves town, he takes the company’s $10 million Challenger 604 jet, which is largely dedicated to his needs, both business and personal.

The evolution of executive grandeur — from very comfortable to jet-setting — reflects one of the primary reasons that the gap between those with the highest incomes and everyone else is widening.

For years, statistics have depicted growing income disparity in the United States, and it has reached levels not seen since the Great Depression. In 2008, the last year for which data are available, for example, the top 0.1 percent of earners took in more than 10 percent of the personal income in the United States, including capital gains, and the top 1 percent took in more than 20 percent. But economists had little idea who these people were. How many were Wall street financiers? Sports stars? Entrepreneurs? Economists could only speculate, and debates over what is fair stalled.

Now a mounting body of economic research indicates that the rise in pay for company executives is a critical feature in the widening income gap.

The largest single chunk of the highest-income earners, it turns out, are executives and other managers in firms, according to a landmark analysis of tax returns by economists Jon Bakija, Adam Cole and Bradley T. Heim. These are not just executives from Wall Street, either, but from companies in even relatively mundane fields such as the milk business.

The top 0.1 percent of earners make about $1.7 million or more, including capital gains. Of those, 41 percent were executives, managers and supervisors at non-financial companies, according to the analysis, with nearly half of them deriving most of their income from their ownership in privately-held firms. An additional 18 percent were managers at financial firms or financial professionals at any sort of firm. In all, nearly 60 percent fell into one of those two categories.

Other recent research, moreover, indicates that executive compensation at the nation’s largest firms has roughly quadrupled in real terms since the 1970s, even as pay for 90 percent of America has stalled.

This trend held at Dean Foods. Over the period from the ’70s until today, while pay for Dean Foods chief executives was rising 10 times over, wages for the unionized workers actually declined slightly. The hourly wage rate for the people who process, pasteurize and package the milk at the company’s dairies declined by 9 percent in real terms, according to union contract records. It is now about $23 an hour.

“Do people bitch because Engles makes so much? Yeah. But there’s nothing you can do about it,” said Bob Goad, 61, a burly former high school wrestler who is a pasteurizer at a Dean Foods plant in Harvard, Ill., and runs an auction business on the side to supplement his income. “These companies have the idea that the only people that matter to the company are those at the top.”

Through a spokesman, Engles declined to be interviewed. Company officials threatened to call the police as a reporter was interviewing workers outside one of its dairies.

Defenders of executive pay have argued that today’s chief executives are worth more because, among other things, companies are larger and more complex.

But critics question why so much of the growth in income should go to the wealthiest. Douglas, the Dean Foods chief from the ’70s, died in 2007. But his son, Andrew Douglas, said his father viewed wages in part as a moral issue.

If his father had seen how much executives were making today, Andrew Douglas said, he’d be “spinning in his grave. My dad just believed that after a while, what else would you need the money for?”

Inherent inequality

Inequality, economists have noted, is an essential part of capitalism. At least in theory, “the invisible hand,” or market system, sets compensation levels to lead workers into pursuits that are the most productive to society. This produces inequality but leads to a more efficient economy.

As a result, economists have noted, there is an inherent tension in market-oriented democracies because while society aims to endow each person with equal political rights, it allows very unequal economic outcomes.

“American society proclaims the worth of every human being,” economist Arthur M. Okun, former chairman of the Council of Economic Advisers, wrote in his 1975 book on the subject, “Equality and Efficiency.’’ But the economy awards “prizes that allow the big winners to feed their pets better than the losers can feed their children.”

Americans have been uneasy about the income gap at least since the ’80s, according to polls.

Repeated surveys by the National Opinion Research Center since 1987 have found that 60 percent or more of Americans agree or strongly agree with the statement that “differences in income in America are too large.”

The uneasiness arises out of the fear that extremes of wealth can unfairly reduce the economic opportunities and political rights of everyone else, according to sociologists. The wealthy, for example, can afford better private schools for their children or acquire political might by purchasing campaign advertising or making campaign donations. Moreover, as millions struggle to find jobs in the wake of the recession, the notion that the very wealthiest are gaining ground strikes some as unfair.

“Americans think income inequality is excessive and have done so consistently for years,” said Leslie McCall, a sociology professor at Northwestern University who is writing a book on the subject. “Their concerns arise when it seems that extreme incomes for some are restricting opportunities for everyone else.”

Whatever people think of it, the gap between the very highest earners and everyone else has been widening significantly.

Income inequality has been on the rise for decades in several nations, including the United Kingdom, China and India, but it has been most pronounced in the United States, economists say.

In 1975, for example, the top 0.1 percent of earners garnered about 2.5 percent of the nation’s income, including capital gains, according to data collected by University of California economist Emmanuel Saez. By 2008, that share had quadrupled and stood at 10.4 percent.

The phenomenon is even more pronounced at even higher levels of income. The share of the income commanded by the top 0.01 percent rose from 0.85 percent to 5.03 percent over that period. For the 15,000 families in that group, average income now stands at $27 million.

In world rankings of income inequality, the United States now falls among some of the world’s less-developed economies.

According to the CIA’s World Factbook, which uses the so-called “Gini coefficient,” a common economic indicator of inequality, the United States ranks as far more unequal than the European Union and the United Kingdom. The United States is in the company of developing countries — just behind Cameroon and Ivory Coast and just ahead of Uganda and Jamaica.

Democratic leaders, whose constituents have expressed more alarm over the divide, have used the phenomenon to justify their policies, such as universal health care.

“A nation cannot prosper long when it favors only the prosperous,” President Obama said in his inaugural address.

Breakdown of earners

But exactly what the government ought to do about the income gap hasn’t been clear, because economists have been divided over what is causing it to grow.

They weren’t even sure, for example, who was making all that money. Sure, people like Bill Gates and LeBron James made lots. But it wasn’t at all clear who the other roughly 140,000 earners were in the top 0.1 percent — that is, people earning about $1.7 million a year, including capital gains.

Then, late last year, economists Bakija, Cole and Heim completed their massive analysis of income tax returns.

Little noticed outside academic circles, their research focused on the top 0.1 percent of earners. From those tax returns, they could glean a taxpayer’s occupation, which is self-reported. Using the employer’s tax identification number, the researchers found the industry they were employed in.

After executives, managers and financial professionals, the next largest groups in the top 0.1 percent of earners was lawyers with 6.2 percent and real estate professionals at 4.7 percent. Media and sports figures, who are often assumed to represent a large portion of very high-income earners, collectively made up only 3 percent.

“Basically, executives represent a much bigger share of the top incomes than a lot of people had thought,” said Bakija, a professor at Williams College, who with his co-authors is continuing the research. “Before, we just didn’t know who these people were.”

Acceptable greed

Defenders of executive pay argue, among other things, that the rising compensation is deserved because firms are larger today. Moreover, this group says, more packages today are based on stock and options, which pay more when the chief executive is successful.

Critics, on other hand, argue that executive salaries have jumped because corporate boards were simply too generous, or more broadly, because greed became more socially acceptable.

Again, in settling these arguments, economists were hampered by a lack of data, particularly any that might give some historical perspective.

It wasn’t until economists Carola Frydman from MIT’s Sloan School of Management and Raven E. Molloy of the Federal Reserve collected and analyzed data going back to 1936 — an exhaustive task because of the lack of computerized records going that far — that the longer-term trends became clear.

What the research showed is that while executive pay at the largest U.S. companies was relatively flat in the ’50s and ’60s, it began a rapid ascent sometime in the ’70s.

As it happens, this was about the same time that income inequality began to widen in the United States, according to the Saez figures.

More importantly, however, the finding that executive pay was flat in the ’50s and ’60s, when firms were growing, appears to contradict the idea that executive pay should naturally rise when companies grow.

This is a “challenge for the market story,” Frydman said.

So what happened since the ’70s that has sent executive pay upward?

While no company over this period of time — from the 1970s to today — can be considered completely typical, Dean Foods offers a better comparison than most because fundamentally it hasn’t changed.

The dairy business is still the root of the company; it was on the Fortune 500 by the late ’70s and remains there today. It grew then and more recently through acquisition.

Moreover, both chief executives — Douglas and Engles — could boast records of growing the company and profits.

From 1970 to 1979, while Douglas was the chief executive, sales at Dean Foods tripled and profits increased tenfold, to $9.8 million, according to company records. Similarly, from 2000 to 2009, sales at what would be Dean Foods had roughly doubled, and so had profits, to $228 million. (Engles became chief executive after the company he led bought Dean Foods in 2001 and adopted its name.)

Yet there are vast differences in the way the two men were paid, even when you adjust for the effects of inflation.

In the late 70s — 1977, 1978 and 1979 — Douglas made about $1 million annually in today’s dollars. The largest part of that was a salary; some came from a long-term incentive based on the stock price that would not mature until he retired.

By contrast, in the late 2000s — 2007, 2008 and 2009 — Engles averaged $10.5 million annually, most of it in stock and options awards and other incentive pay, according to proxy statements. After ’09, which was a particularly bad year, Engles’s compensation dropped to $4 million in 2010. If profits return, so will his higher earnings.

The case of Dean Foods appears to bolster the argument that executive compensation moves with company size: The profits for Dean Foods in 2009 were roughly 10 times what they were in 1979, adjusted for constant dollars. Engles’s compensation has averaged 10 times that of Douglas.

“It’s a different company today,” company spokesman Jamaison Schuler said. He declined to comment further.

But some economists have offered an alternative, difficult-to-quantify explanation: that the social norms that once reined in executive pay have disappeared.

This new attitude, according to this view, was reflected in epigrammatic form by the 1987 movie “Wall Street,” which made famous the phrase “greed, for lack of a better word, is good.” Americans were growing more comfortable with some extremes in pay. Payoffs for the stars on Wall Street, in the movies and in pro sports were rising.

But back in the ’70s, something was holding executive salaries back.

Harold Geneen, the president of ITT, then one of the nation’s largest companies, told Forbes in 1975 that while he might be worth six times as much to the company as he was making, he hadn’t sought a raise.

“No one moved up there, and I didn’t dare do it alone,” he explained.

Over at Dean Foods, Kenneth Douglas was likewise resistant to making more. Most years, board members at Dean Foods wanted to give Douglas a raise. But more than once, Douglas, a former FBI agent who literally married the girl next door, refused.

“He would object to the pay we gave him sometimes — not because he thought it was too little; he thought it was too much,” said Alexander J. Vogl, a members of the Dean Foods board at the time and the chair of its compensation committee. “He was afraid it would be bad for morale, him getting a big bump like that.”

“He believed the reward went to the shareholders, not to any one man,” said John P. Frazee, another former board member. “Today we get cults of personality around the CEO, but then there was not a cult of personality.”

Outside one of the Dean Foods dairies recently, the workers at the plant for the most part only rolled their eyes when asked about Engles’s salary. But they spoke admiringly of Douglas.

“People back then thought enough was enough,” said Ron Smith, 63, who maintains the machines at the plant.

Some were reluctant to criticize Engles to a reporter. Others defended him.

“You’re king of the hill, and you get paid for that,” said Ray Kavanaugh, 61, who operates a filler at the dairy. “He’s worth it if he keep the company making money.”

The employees said they only occasionally dwell on Engles’s riches, anyway. Their primary focus is on making ends meet, they said.

Joe Bopp, 55, said he has a second job taking care of a cemetery during the summer months, mowing the grass and digging graves.

“Twenty-three dollars an hour sounds like a lot of money,” he said. “But when you pay $4 a gallon for gas and $3.29 for a gallon of milk, it goes away real fast.”


This is the first in an occasional series.

Cracked: Why the Poor Stay Poor

5 Things Nobody Tells You About Being Poor

By:

John Cheese

May 27, 2011 LINK

Being poor is like a game of poker where if you lose, the other players get to fuck you. And if you win, the dealer fucks you.

A bunch of you reading this are among the 45 million "working poor" in America, and if you're not, you know somebody who is. Like me.

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Or 60 percent of all retired NBA players, according to this site.

I'm not blaming anybody but myself for getting into this situation (I was drunk for two straight decades) and I'm not asking for anybody's sympathy. What I am saying is that people are quick to tell you to pick yourself up by your bootstraps and just stop being poor. What they don't understand is the series of intricate financial traps that makes that incrediblydifficult.

If you're not poor, that's awesome. I'm not mad at you, or jealous. Hopefully you'll never find out that ...

#5.

You Get Charged for Using Your Own Money

This is the future, where many businesses no longer accept cash as payment. That means you are required to have a checking account to function in the economy. And if you're poor, that means at some point you're going to get bank-fucked.

Because having a checking account while poor doesn't just mean you have to be responsible and good at math -- you have to be perfect. Meticulous, flawless record keeping is the difference between surviving and having the bank seize your next paycheck.

Let's say you're running late for work and hurriedly stop to get gas, paying with a bank card. In your haste you forget to write the $55 down (gas being $4 a gallon, you know). So while you spent the last week until payday thinking you had $50 in your account to absorb minor purchases, you actually were $5 in the red.

So payday comes. You go to the bank to deposit your check, at which point the bank takes it, sticks it in their pocket and says, "Thank you very much! I'm buying myself a new pair of shoes with that shit!" They then inform you that your account was at -$200 at the moment you deposited your check.

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Oh, it gets a lot worse, stock photo woman.

The bank can hit you with a $35 fine for every charge that comes in while you are in minus territory. The bank will not tell you they charged you this money. You will have no idea anything is wrong.

It's a silent chain reaction in which every charge that comes through during those few days before payday draws the $35 fee. The $8 you spent at the gas station for cigarettes, the $24.99 that automatically comes out for your Internet access ... for each, the bank silently zaps out the charge and $35 on top of it, until your next paycheck is gone. Five seconds of oversight gave the bank the right to take away a week's worth of your labor.

Some of you are saying, "Fine, just tell the bank to go fuck itself. Walk out the door and just do everything by cash or money order." Ah, but now when you get paid, you have to go somewhere to cash your paycheck -- and businesses charge up to $8 to do it. If you're working in the service industry, congratulations -- an hour of your labor just vanished ... just so you could use your own money. Some describe this as a "poverty tax." Others refer to it as a "Because fuck you, that's why" fee.

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The one piece of advice I can offer here is that you'll be surprised how many businesses will give you some leeway if you just call them and beg. Banks are run by human beings (as of the writing of this article) and if you get a person on the phone you can get them to waive overdraft fees, particularly if it's a first offense. Even businesses waiting on a payment will give you an extra week or two if you call and explain it. In this economy, they're so used to people just taking the money and disappearing that they're happy to hear you're operating in some kind of good faith.

Otherwise, you're going to be in a bind. And this is when you'll find out ...

#4.

There is an Industry That Profits by Keeping You Poor

Think you're too smart to ever use one of those shady "payday loan" places? Well, you should know that nobody thinks they're a good deal. People go there because they're choosing between which fucking provides the most lube.

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Yeah, when you're done choosing, just stay in that position, buddy.

Say the gas bill is a month past due, and they're threatening to turn it off (if so, it's $150 to get it reconnected). Or you're about to be late on a credit card payment (which would be a fee and a doubling of your interest rate). Or your favorite S&M whip broke, and Whipfest is coming up (entry fee is nonrefundable). That is when you find yourself swallowing your pride and heading to the payday loan place.

A standard 14-day "payday" loan charges $15.50 per $100 borrowed. So a $500 loan ends up being $577.50 (or 1.5 tanks of gas in interest). But if you don't have it after 14 days, that's fine -- they offer to extend your loan to 180 days. It makes the payments miniscule. Oh, and you'll be paying back $1,275 at 403.10 percent APR.

Yes, you got fucked, in the name of your financial asshole avoiding the credit card company's bigger, barbed dick. And it's a hell of a lot better than going over on your checking account again and starting up their infinite circular fuckatron.

Via Travelblog.org
Using this.

All right, let's say you wisen up. You save and cut back. You resist an offer to, say, buy a computer on Best Buy's finance plan, because you're too smart to take on more debt. And no monthly cell phone payments for you, oh no. You're not going to put yourself in a hole again!

Congratulations. You just did. It turns out ...

#3.

No Credit Can be Just as Damaging as Bad Credit

On the spectrum of financial responsibility, from "that billionaire who drives an old Dodge Dakota" down to "MC Hammer," you'd think that the next step up from being overdue on a bunch of bills would be to have no bills at all. Don't buy it if you can't afford it, right?

You'll find out the problem the next time somebody does a credit check -- having no credit will stop you from getting a loan or an apartment just as fast as having bad credit. And more importantly, if you have old bad credit due to a bunch of previous fuckups, simply vanishing off the credit map doesn't do anything to fix it.

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It sounds good in theory, though.

It took me six months to find a place to rent after applying for every property that appeared in the paper across five towns. I was denied each time. It was my lack of credit due to years of me and lenders deciding to just stay out of each other's hair, like those old sitcoms where roommates would draw a line down the middle of the house. I even used a prepaid cell phone where I'd just be buying minutes off the shelf rather than get locked into a contract with all those termination fees and shit. When I needed something big, like a computer upgrade or furniture, I'd wait for a windfall, like a tax return, and pay cash. It's called financial responsibility, motherfucker!

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Now hand over the heroin, bitch!

Nope. It turns out that to a business, a customer with no credit is like a girl giving you the silent treatment -- they assume something is wrong.

And everybody checks your credit -- if I want to get Direct TV, I have to pay $310 worth of startup fees (the size of your up-front payments/deposits depends on your credit history). Utilities are even more -- which means trying to move to a new place costs hundreds of dollars in deposits (remember the $150 to get my gas turned on). If I need a new car, well, let's just say I need to show up at the dealership with a shoebox full of cash.

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The last two kids I bought on the black market virtually wiped out my life savings.

So repairing credit means opening accounts (having a cell phone plan is a good one, having your utilities in your own name -- as opposed to the landlord's -- is another) and, you know, making sure to pay your fucking bills on time. And don't bother trying to shortcut the system by saving the shoebox full of cash, getting a loan, then paying it all off the next month. Length of credit is part of your credit score. They want to know your ability to make steady, long term payments without missing a month or being late.

#2.

Your Next Expensive Disaster is Always Around the Corner

Shit happens, always at the exact worst time. A tire blows on my car and, without a spare, it instantly becomes a paperweight. There's $80 for a new tire, $50 for a tow. Now, it's a good idea to have a separate bank account set up specifically for these situations because they are unavoidable. It's also a good idea to have a sex slave or two just sitting around in case your balls need shaved. It's not that fucking simple.

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Just a little further, sir. We need to be able to stab your heart with our dicks.

You get the same domino effect with sudden financial disasters as you do with the bank fees. For instance, I worked a shitty service industry job, which meant I got paid by the hour, and didn't get paid unless I showed up -- no paid time off. But I couldn't physically get to work because of the goddamned flat tire. It's a rural area, no subway or buses. So it's double penetration -- not just lost work time, but lost time that is spent paying for a tow and a tire. And if I didn't happen to have that money sitting around, it meant waiting until payday, and missing work until then.

Which meant my next paycheck would be short. By the time I get it fixed and add in the missed work time, that $80 tire just turned into a $250 enema. That's life in a world with no financial margin for error. It's like trying to climb out of a dick pit but the ladder is also made of dicks.

Years ago, we bought a house with the help of our in-laws. You know, because owning property is the responsible adult thing to do. The very first fucking night of moving in, we got a massive water leak. I couldn't just call the landlord -- I was the landlord. I couldn't call a plumber because we didn't have the $150 to pay the guy, not until payday. So the leak was allowed to run until we could put the money together to pay one. So two weeks later, we hand the guy $150. And then, a week later, the water bill arrives.

$500.

You find yourself thinking, "Man, we could get caught up if this bad shit wouldn't keep happening!" Then it finally hits you that bad shit happens like clockwork. Not because God hates you, but because you're poor and you're using cheap shit that breaks. Maybe you don't pay the $150 for a plumber, but have a handy friend fix it for you for $50. Awesome, you saved $100! Then six months later you have a leak again, because it turns out he fixed it with rubber bands and Fruit Roll-ups.

Everything in a poor person's life is a cash vampire. My truck has 170,000 miles on it and the MPG is so bad that every time I start it, the ghost of an Indian appears in the passenger seat and cries. About twice a year, something under the hood grinds to a halt or melts -- always another $500 on a tow and repairs. And that was the money I was saving to get a more reliable car.

Hell, even my own body does it to me. I lost my last job because of chronic back pain, losing my health insurance in the process. Which means I can't treat my chronic back pain. Can't afford to get dentist check-ups, so more expensive problems are allowed to grow and fester. And so on.

#1.

You're Always in Survival Mode

There's a phrase in the working world that drives me crazy. One guy says, "The money's not great, but I love my job." And somebody responds, "Hey, happiness is all that really matters."

To be clear, that's probably true for people at a certain level of income. If you aren't struggling to pay the bills, then happiness is indeed a pretty damn awesome extra. But you know those movies like American Beauty, about the guy with the unfulfilling career who abandons it to live life to its fullest? Yeah, don't forget that after quitting their jobs they still come home to houses that look like this:

But down here, at this level, you take what you can fucking get. Fantasies about holding out for that dream job will ruin you.

For instance, long before reading to this part, some helpful commenter has surely skipped down and chimed in with, "Why don't you just get a job, you lazy fuck!" Wait, did you think I was unemployed? Hell no, it's been years since I was out of work for any long period of time. I've always had jobs. Shitty, shitty jobs.

A huge chunk of this economy runs on shitty jobs now. Recently, McDonald's held a job fair with 50,000 openings. They got more than 1,000,000 applications. Tens of millions of you will wind up in one of these jobs, it's sheer math.

These service jobs pay hourly, they give you little or nothing in terms of benefits and there is nothing in the way of security even from week to week -- your hours could get cut at any time, for any reason. Sure, you can take a second part-time job. Though, that's assuming you can find one that works around your primary job's schedule -- just mentioning that you have another job in an interview is often enough to stop that interview mid-sentence. Why hire you when there are 30 guys in line behind you with completely free schedules?

So in answer to the inevitable, "You need to dream bigger, and strive forth to get a new career for yourself!" Hey, I totally agree. But now we're back in the Catch-22 poverty fuck gauntlet. Once you're in this tier of jobs, getting out isn't just hard, it's expensive.

Sure, you can take classes at night at a community college or something. Maybe you'll even get financial aid or loans to pay for your books or tuition. What they will not pay for is the time you missed at work while you were in classes or for a babysitter or for transportation. And you sure as fuck better be certain that you have some kind of aptitude for whatever you're studying (which, by the way, you won't know until you've spent a year or two studying it) because that's the only chance you're going to get.

You can do it the old-fashioned way, by working your way up the corporate ladder from within whatever shitty job you have. But that is also expensive because promotions often require you to move. I got offered a promotion at my shitty service job (washing semi trucks with high-pressure hoses, the job that eventually destroyed my back) that would have required me to move several hours away. And moving costs money -- remember what I said about the cost of getting utilities turned on? And how landlords check your credit?

And then there are the intangible costs. I would be abandoning my children, for instance -- I share custody with my ex-wife, who obviously was not going to be moving with me. How many visits would I get in before my car broke down? And moving away from friends and family also comes with a cost -- think of the favors you do for each other (i.e. the friend/brother/uncle willing to fix the truck for free, because you helped paint his porch, etc).

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Rounding each other's fros.

It's not impossible, but it's taking a huge risk. And if the new job doesn't work out after you bet all of your chips, you're triple fucked. And at that point the world will wag its finger at you and tell you how irresponsible it was to move when you were so poor. "Ha, you poor people are always doing stupid shit like that!"

And on and on. People do get out of this situation -- I got paid to write this, for instance. All I'm saying is that the journey is something like trying to go from the Earth to the Moon. By letting them launch a Saturn V rocket directly into your butthole.

For more from Cheese, check out Quitting Smoking: 6 Things You Notice About the Stupid World and 5 Things Nobody Tells You About Quitting Drinking.