Unless you’ve been hiding under a rock, you’re well familiar with the fact that income inequality is growing and middle class families are getting squeezed. While corporate profits are growing faster than ever, CEOs and other top earners are keeping those profits for themselves while the rest of us are being left behind.
And now: Another week, another starkly juxtaposed set of news clips showing the disparity between the “haves” and “have-nots” in our country:
1. Despite Walmart’s CEO’s record-high pay rate, the average full-time associate at Walmart makes just $15,576 a year, well below the federal poverty rate. It is, of course, completely unreasonable to expect a family to make it on those wages.
And Walmart knows this!
The store pays its employees so little that the choice to celebrate Thanksgiving with a special meal simply does not exist. But what does Walmart think should be done about this? Rather, who do they think should address this? Not the extraordinarily profitable Walmart. No, the store thinks that others should “chip in” to make up for Walmart’s terrible, terrible wages.
(Or maybe the store has calculated that those families don’t need to be able to afford Thanksgiving dinner, since Walmart is making them work that day anyway.)
But here’s the thing — Americans are already footing the bill for the stores’ minimum wage jobs. Earlier this year, Congressional Democrats found that one Walmart cost taxpayers nearly $1 million, based on the low wages paid to employees who were then forced to rely on food stamps and other government assistance to get by. That’s $900,000 in taxpayer subsidies for just one store.
2. In the meantime, Walmart’s CEO earned $20.7 million in 2012. That means the store’s CEO made more than 1,300 times more than the average full time associate.
Pretty astounding. Now, what if I shared that the full story of wage inequality at Walmart is even worse than that?
Just published last week:
You are reading that correctly. Walmart’s CEO pension is more than 6,000 times that of its average worker. This figure is important, as it reveals the full picture of overall compensation and the real scope of wage inequality. As NerdWallet reports, “CEOs often defer receiving their multimillion-dollar cash bonuses till their retirement years, storing the cash away in a retirement plan that typically allows them to pay lower taxes once they draw on the money.”
Walmart FY2013 profits were $27.8 billion. That means they could pay all their 2.2 million employees another $5,000/year and still make nearly $17 billion in profit. Yet Walmart “can’t afford” to pay more than a living wage?
It’s important to recognize that Walmart is just one example; but there are hundreds of corporations pocketing the same exorbitant profits for those at the top while paying poverty wages to those at the bottom. This is no accident. It’s actually the new corporate business model: Pay poverty wages, pocket the profits, and reward the CEO for doing it successfully.
These tactics are wrong, and it affects all of us. Because this growing wealth disparity isn’t just unfortunate of its own accord — it actually is the root cause of our stalled economic recovery. So, in other words, even if you’re fortunate to be working a job with a good, living wage, these workplace policies hurt you, too.