What caught my eye one fine day was a story in the Times about the CEO of Merrill Lynch. The board of Merryl Lynch was trying to decide if they should ask their executive E. Stanley O’Neal to step down. The firm has posted a third quarter loss of 2.3 billion dollars, and has seen an 8.4 billion dollar write down of its total value because of actions in the sub-prime mortgage market, among other poor decisions. Suffice it to say, this man has sucked at his job. He’s cost the company, and shareholders, BILLIONS of dollars. Actually, news of his impending departure saw stock prices rise $5.19 a share! Anyway, so this guy sucked at his job. We’ve all known people who’ve sucked at what they do. They’re the annoying ones in the office, the ones you just wish would call in sick everyday, because you get MORE work done when they aren’t around. But, what do you do when it’s your BOSS? That’s bad. I’ve been in that situation, and I quit. But I have always worked for non-profits, so there was no money at stake, just my mental health. Anyway, so, when asked how under his leadership Merrill Lynch could lose so much money, E. Stanly O’Neal replied: “We made a mistake”.
WE MADE A MISTAKE???? What??? I’ve made mistakes. I’ve locked my keys in my car. It sucked, but a little help from a coat hanger, and I got them out. I’ve forgotten people’s names at times, I hate that I do that, but, it has happened, and I felt bad. I’ve rolled through stop signs, added things incorrectly, hit the wrong number on my cell phone (and someone answered and I proceeded to begin a conversation with them that I absolutely should NOT have because it was meant for another person entirely, and that is a funny story, but I haven’t written it yet so you’ll have to wait on that one), yes, I’ve done a bunch of stupid things, made a bunch of mistakes, but… none of them cost ANYONE any money, let alone billions of dollars.
But E. Stanley O’Neal, he’s quite a different story. He steers the company in a bad direction, causes losses totaling 10 billion dollars (so far), and then says WE MADE A MISTAKE.
Woops. I lost a billion dollars. I hate when that happens.
So why does it matter? Why should anyone care that this guy is such a complete corporate fuck up? Well, because his severance package is going to be worth at least 159 million dollars. That’s right. 159 MILLION!!! He gets that for FUCKING UP!
You gotta love capitalism. Seriously. Here’s where it just gets so interesting. See, people who support corporate capitalism, who think its just so great because the market decides who is fit and who is not, what’s good and what is not… these people, these people are constantly talking about how the market is the ultimate arbiter of what works and what doesn’t. Economic Darwinism. And they swear by it. Can’t have socialism because that would promote mediocrity, they say. Corporate capitalism ensures that talent and skill and ingenuity will rise to the top. Except when it comes to compensation packages for miserably untalented executives. Then, we reward them no matter how shitty a job they do.
So E. Stanley O’Neal can ruin the careers of a few people, cost shareholders billions of dollars, and he STILL gets to walk away with a severance package worth about 3,500 times what an average American family makes in a year. That’s right. Three thousand five hundred times what most American families make in a year.
Let’s put this in perspective. The minimum wage, at $7.25 per hour, peaked in 1968 at 90% of the poverty level. That means a wage earner making minimum wage, after working an entire year, would still be 10% below the poverty level- and that was in 1968, at its highest relative value. Today, its just a little over 50%. Now, if you took every dollar earned in a year by someone making minimum wage, and laid them out end to end, it would make a line about a mile long. Basically, it might get you to your nearest Dunkin’ Donuts. And you could use the last two dollars to buy yourself a cup of coffee. Now if you were an average American family, earning something around the median income, let’s take the median family income for the state of Iowa for instance, well… if you strung all your dollars up, end to end, that you earned in a year, it would make a trail about 7 miles long. That would get you to your nearest pizza place, and back. With enough left over to buy a pie. I like pepperoni. Anyway, now pretend you are E. Stanley O’Neal. Go ahead, do it. And pretend that you just got your severance package of 159 million dollars. And you laid all you dollars out, end to end. Do you know where you could go? China. That’s right, China. If you started out at the Empire State Building, and laid all your dollars out end to end, you could go all the way to fucking China. And back again. AND, there’d be enough left over for you to go to the Hamptons for the weekend.
That is the disparity of wealth in America. And it’s not about hard work. Or ingenuity. Or talent. Or brains. E . Stanley O’Neal is an untalented, uninspired, unintelligent, incompetent douche bag, and he gets to walk with the net worth of a couple of baseball teams. There goes your argument for the glories of capitalism. You can take E. Stanley O’Neal’s compensation package and your copy of Ayn Rand’s “The Fountainhead” and stick it right up your…..
I must go on. And yes, if you are wondering, the measurements in the preceding paragraph are correct. I measured a dollar bill. And then multiplied and divided and figured out that E. Stanley O’Neal could make it to China and back (and then to the Hamptons) with just his severance package, and someone making minimum wage could go to Dunkin’ Donuts and get coffee. I like Dunkin’. Anyway…
He’s not the only one. There’s many more. Here are a couple of others: Henry A. Kinnell Jr. was given a 200 million dollar exit from Pfizer after overseeing a 41 percent drop in it’s share value. FORTY ONE PERCENT! Almost half! Seriously. And what’s worse is that Pfizer laid off 7,000 people that year. Right before Christmas. Merry Christmas -you’re unemployed. I bet none of those people got anything near 200 million dollars when they were asked to leave. Nope. Just a pink slip and a “can you leave the bathroom key at the front desk please”.
Phillip Purcell of Morgan Stanley walked off with 144 million dollars after overseeing big losses and a plummeting of their stock in 2005. The list goes on. Basically, it seems that the bigger your “mistake” , the more money they pay you to leave. Maybe that’s it. They are paying them to leave. It’s like you have a party, and invite a bunch of your friends, and then your friend brings the new guy she’s dating. He seems really nice at first, but then he proceeds to get really drunk and starts breaking shit. He knocks things over. He drops plates. Then he breaks a lamp. Knocks over bottles. Makes a complete mess. Destroys your good crystal. Dumps champagne out of the window onto the heads of people walking in the street below. So, you ask him to leave. But he won’t. So you think of everything, but he still won’t leave. So you give him 20 bucks, call him a cab, and he’s gone. Your friend is embarrassed, but it’s not her fault. She never saw him get drunk before. So you forgive her. And you think hey, he probably broke a few hundred dollars worth of shit in your house, what’s another 20 bucks to get him to leave. And then he’s gone. You’re happy. Your neighbors might hate you for a while, but ultimately, things will work out in the end.
$159 million dollars. And I bet he doesn’t have to take a cab home.
So, this is what’s rotten in America today. Average families are seeing their real incomes fall on a yearly basis. Meanwhile, the top 1% of the wealthiest Americans continue to increase their share of the country’s wealth. And since GNP growth continues to proportionately affect all areas of the population, in other words, as the economy expands slightly, the largest portion of that goes to the richest 1%, while absolutely none goes to the bottom 25%, what happens is the rich get richer, and the poor get screwed. Now, a true corporate capitalist would say that’s OK, because it’s the rich who are DRIVING this economy. Remember, they are the “job creators”. But I just showed you that that is not the case. Corporate executives are making decisions that monkeys on crack wouldn’t even make, and they are getting rewarded for it.
The Rich get richer, and the poor get screwed. It’s actually related.That’s simple math, if the wealthiest Americans are increasing their wealth, it has to come from somewhere. It comes from working class and poor Americans. You can’t have extreme concentrations of wealth without extreme concentrations of poverty.
So that’s where we are. And it stinks. Corporate Capitalists are ruining this economy, and E. Stanley O’Neal is a moron. His company is going to give him hundreds of millions of dollars ANYWAY. This is going on, and has been going on, for years.
And, over the past 40 years, average Americans have seen real wages fall. Consistently. 1/5 of our nations children live below the poverty level. Almost 50 million Americans have no health insurance. Millions are homeless. The list goes on. The question is, why aren’t average Americans pissed off? They should be. But the story isn’t front page news. What is? Jersey Shore.
Malcolm X once said the only difference between American people and the people in the rest of the world is that when the people in the rest of the world are oppressed, they know it. And I’ve always said, but I’m not famous, or dead, that we’ve got more to worry about from within, then from terrorists or anti-biotic resistant superbugs, or any of those things.
What’s going to destroy the very foundation that this nation stands on isn’t Al Qaeda or a super-bug gone wild. It’s the super rich, rewarding mediocrity, and having a party while the whole place goes up in flames. Nero played violin when Rome burned, E. Stanley O’Neal will be drinking Dom Perignon and laughing all the way to…China.
And back again.