As progressives have worked to win the fight for a $15 federal minimum wage, CEO pay has skyrocketed even further in the past year--while business leaders and Republicans have claimed that raising wages for workers would be prohibitively expensive.
The Economic Policy Institute (EPI) released a new report Thursday showing how executive compensation surged during President Donald Trump's first year in office --as Republicans were pitching their tax plan with promises that the proposal would offer benefits and savings to middle-class and working Americans across the country.
Looking at CEO pay based on stock options, salary, bonuses, and other forms of payment, EPI found that the average top executive at the 350 largest U.S. firms walked away with between $13.3 and $18.9 million last year. The previous year, those same CEOs made between $13 and $17.6 million.
This means that CEO compensation rose by more than 1,000 percent between 1978 and 2017, while the typical American worker's wages have gone up by just 11.2 percent over the same period.
"It is difficult to believe that Congress passed a tax cut weighted so heavily towards the wealthy when the nation's top CEOs are clearly doing fine." --Lawrence Mishel, EPIEven the very highest earners who are not CEO's--those in the top 0.1 percent--didn't see as much wage growth as CEOs, noted EPI president Lawrence Mishel and economic analyst Jessica Schieder, with their pay rising 308 percent since 1978.
"Higher CEO pay does not reflect correspondingly higher output or better firm performance," wrote Mishel and Schieder. "Exorbitant CEO pay therefore means that the fruits of economic growth are not going to ordinary workers."
The exorbitant compensation lavished on executives last year is likely to grow even more in the coming year, as CEOs reap the benefits of the Republican Party's tax law, which passed last December.
Numerous reports have indicated that despite the promises of House Speaker Paul Ryan (R-Wis.) and President Donald Trump, the savings and benefits of the tax law have been enjoyed not by working Americans but by the wealthiest households and the heads of companies whose compensation was already exploding when the plan was signed into law.
In January, Americans for Tax Fairness reported that fewer than 10 percent of highly-profitable Fortune 500 companies had shared the benefits of the tax law with their employees, instead directing savings to their shareholders through stock buybacks and dividends.
The Center on Budget and Policy Priorities (CBPP) had said just before the law was passed that "a third of the benefits from corporate rate cuts will ultimately flow to the top 1 percent of households, not ordinary workers."
"With wages for working people barely budging, it's remarkable to see top CEO pay surging again," said Mishel. "It is difficult to believe that Congress passed a tax cut weighted so heavily towards the wealthy when the nation's top CEOs are clearly doing fine."
