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August 31, 2011

At least 25 top United States companies paid more to their CEO’s in 2010 than they did to the federal government in taxes

Filed under: Economy,Wealth — millerlf @ 1:41 pm
Where Pay for Chiefs Outstrips U.S. Taxes
By Published: August 31, 2011

Verizon’s chief, Ivan Seidenberg, earned $18.1 million in 2010; the company got a tax refund.

John Donahoe, eBay’s chief, collected a compensation package over $12 million, while eBay got a $113 million federal refund.

The companies — which include household names like eBay, Boeing, General Electric and Verizon — averaged $1.9 billion each in profits, according to the study by the Institute for Policy Studies, a liberal-leaning research group. But a variety of shelters, loopholes and tax reduction strategies allowed the companies to average $304 million each in tax benefits — which can be taken as a refund or used as write-off against earnings in future years.

The chief executives of those companies were paid an average of more than $16 million a year, the study found, a figure substantially higher than the $10.8 million average for all companies in the Standard & Poor’s 500-stock index.


May 15, 2011

Income distortions affecting our democracy

Filed under: Poverty,Wealth,Wisconsin Class Warfare — millerlf @ 7:21 pm

By Mike McCabe May 14, 2011 MJS

We have reached the point in which the richest 1% of Americans have more wealth than the bottom 95% combined, a sad truth verified in 2009 by The 400 richest Americans have a bigger net worth than half of all Americans collectively, another harrowing statistic confirmed by PolitiFact earlier this year.

Such a grotesque redistribution of wealth from the many to a privileged few is inconsistent with any legitimate notion of economic justice, not to mention incompatible with democracy.

This condition is the product of a long series of deliberate policy decisions flowing from a corrupted political process. It also, in turn, reinforces the establishment of plutocracy – government of, by and for the wealthy.

If we were founding a nation today and had the nerve to embark on a journey leading to the creation of a democracy, there is no way we would fashion a system of paying for elections that even remotely resembles what we have now – which is legal bribery resulting in the sale of government to the highest bidder and the exclusion of everyone except those who are independently wealthy or willing to take out a second mortgage on their soul to pursue most public offices.

But here we are, 235 years into the American experiment, and that’s exactly where we are stuck.

In Wisconsin, less than 1% of the population pays for all the election campaigning by state politicians. After buying the elections, that tiny fraction of our society ends up owning our government. These elites are then rewarded with what amounts to “wealthfare” payments – tax breaks, pork barrel spending, patronage jobs, no-bid contracts for state government work and other special benefits – at our expense.

It doesn’t have to be this way. We are better than this.

Few inside the Capitol, where so many are so heavily invested in the status quo, are recommending any cures for what ails our democracy. If we’re looking for ideas on how to get us to a better place and the inspiration to make it happen, we’d best look in the mirror.

To that end, the Wisconsin Democracy Campaign has put forward a new campaign reform plan called Ending Wealthfare As We Know It that aims to replace big-money plutocracy with a small-dollar democracy. It tackles legal bribery by sharply lowering limits on the size of allowable campaign contributions to candidates for state office.

It further attacks the wealthfare system by creating strong incentives for candidates to seek support from the communities they will represent if elected rather than outside interests and by incentivizing greater participation by small donors who live where the candidates are running.

The centerpieces of Ending Wealthfare are a public matching program for small-dollar political donations, a tax credit for small contributions, significantly tighter limits on campaign giving and far greater disclosure and accountability for outside interest groups.

More information about this initiative is available online at

The cost of Ending Wealthfare is $10 a year for each Wisconsin taxpayer, leaving each of us with questions to answer. Is putting an end to legal bribery in state politics worth $10 a year? Is it worth $10 to have a voice at the Capitol? Is that too much to pay to have a democracy?

Mike McCabe is executive director of the Wisconsin Democracy Campaign, a nonpartisan watchdog group. The Democracy Campaign’s website is

February 22, 2011

Why Isn’t Wall Street in Jail?

Filed under: Economy,Wealth — millerlf @ 8:06 am

Why Isn’t Wall Street in Jail?

Financial crooks brought down the world’s economy — but the feds are doing more to protect them than to prosecute them

By: Matt Taibbi February 16, 2011 Rolling Stone Magazine

Over drinks at a bar on a dreary, snowy night in Washington this past month, a former Senate investigator laughed as he polished off his beer.

“Everything’s fucked up, and nobody goes to jail,” he said. “That’s your whole story right there. Hell, you don’t even have to write the rest of it. Just write that.”

I put down my notebook. “Just that?”

“That’s right,” he said, signaling to the waitress for the check. “Everything’s fucked up, and nobody goes to jail. You can end the piece right there.”

Nobody goes to jail. This is the mantra of the financial-crisis era, one that saw virtually every major bank and financial company on Wall Street embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world’s wealth — and nobody went to jail. Nobody, that is, except Bernie Madoff, a flamboyant and pathological celebrity con artist, whose victims happened to be other rich and famous people.

The rest of them, all of them, got off. Not a single executive who ran the companies that cooked up and cashed in on the phony financial boom — an industrywide scam that involved the mass sale of mismarked, fraudulent mortgage-backed securities — has ever been convicted. Their names by now are familiar to even the most casual Middle American news consumer: companies like AIG, Goldman Sachs, Lehman Brothers, JP Morgan Chase, Bank of America and Morgan Stanley. Most of these firms were directly involved in elaborate fraud and theft. Lehman Brothers hid billions in loans from its investors. Bank of America lied about billions in bonuses. Goldman Sachs failed to tell clients how it put together the born-to-lose toxic mortgage deals it was selling. What’s more, many of these companies had corporate chieftains whose actions cost investors billions — from AIG derivatives chief Joe Cassano, who assured investors they would not lose even “one dollar” just months before his unit imploded, to the $263 million in compensation that former Lehman chief Dick “The Gorilla” Fuld conveniently failed to disclose. Yet not one of them has faced time behind bars.

Also read Invasion of the Home Snatchers

Instead, federal regulators and prosecutors have let the banks and finance companies that tried to burn the world economy to the ground get off with carefully orchestrated settlements — whitewash jobs that involve the firms paying pathetically small fines without even being required to admit wrongdoing. To add insult to injury, the people who actually committed the crimes almost never pay the fines themselves; banks caught defrauding their shareholders often use shareholder money to foot the tab of justice. “If the allegations in these settlements are true,” says Jed Rakoff, a federal judge in the Southern District of New York, “it’s management buying its way off cheap, from the pockets of their victims.”

To understand the significance of this, one has to think carefully about the efficacy of fines as a punishment for a defendant pool that includes the richest people on earth — people who simply get their companies to pay their fines for them. Conversely, one has to consider the powerful deterrent to further wrongdoing that the state is missing by not introducing this particular class of people to the experience of incarceration. “You put Lloyd Blankfein in pound-me-in-the-ass prison for one six-month term, and all this bullshit would stop, all over Wall Street,” says a former congressional aide. “That’s all it would take. Just once.”

But that hasn’t happened. Because the entire system set up to monitor and regulate Wall Street is fucked up.

Just ask the people who tried to do the right thing.

Also read Wall Street’s Naked Swindle

Here’s how regulation of Wall Street is supposed to work. To begin with, there’s a semigigantic list of public and quasi-public agencies ostensibly keeping their eyes on the economy, a dense alphabet soup of banking, insurance, S&L, securities and commodities regulators like the Federal Reserve, the Federal Deposit Insurance Corp. (FDIC), the Office of the Comptroller of the Currency (OCC) and the Commodity Futures Trading Commission (CFTC), as well as supposedly “self-regulating organizations” like the New York Stock Exchange. All of these outfits, by law, can at least begin the process of catching and investigating financial criminals, though none of them has prosecutorial power.


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