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From Tesla to McDonald's, these are the 20 CEO-enriching companies that would get hit hardest by Bernie Sanders' new inequality tax
From Tesla to McDonald's, these are the 20 CEO-enriching companies that would get hit hardest by Bernie Sanders' new inequality tax
Carmen ReinickeSep 30, 2019, 23:18 IST
Wikimedia Commons
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Sen. Bernie Sanders announced a tax plan Monday that would penalize companies where CEOs make more than 50 times the median worker.
There are 50 companies where the top executive makes more than 1,000 times the median worker, according to a study by the Institute for Policy Studies.
Listed below are the top 20 companies where the pay gap between workers and CEOs is more than 1,000.
On Monday, Sen. Bernie Sanders announced a new Income Inequality Tax Plan that aims to penalize companies where the top executive is paid more than 50 times what the median worker makes.
But at many companies the inequality Sanders aims to tackle is even more pronounced. According to a new study by the Institute for Policy Studies - which the presidential hopeful cited in his tax plan - there are at least 50 companies where the top executive is taking home more than 1,000 times what workers are making.
"At the 50 publicly traded US corporations with the widest pay gaps in 2018, the typical employee would have to work at least 1,000 years - an entire millennium - to earn what their CEO made in just one," co-authors Sarah Anderson and Sam Pizzigati wrote in the September study.
The median CEO pay at these top 50 firms was $15.9 million in 2018, according to the study. For the typcial worker at the same firms, average 2018 pay was $10,027. Roughly 88% had temporary or part-time status in 2018, the study found. Further, 31% of them worked in China, Mexico, or another low-wage country.
The problem is prevalent even outside the top 50 firms with the widest pay gaps, according to the study. More than 80% of firms in the S&P 500 paid their CEO more than 100 times the median worker pay in 2018, IPS found. Only five firms in that group had ratios of less than 25-to-1.
But even that's a flawed measure of CEO wealth, according to the study. The majority of CEO real earnings come from holding company stock. Those can be as high as $87 billion for Warren Buffett at Berkshire Hathaway.
These kinds of pay incentives also factored into the IPS ranking. Elon Musk of Tesla makes more than 40,000 times the median worker, based on a $2.2 billion stock option he was awarded in 2018.
Here are the top 20 firms with the widest pay gaps between median workers and CEOs, according to the IPS report. They are organized by the pay ratio from smallest to largest.
*This outlier ratio is based on a $2.2 billion stock option award to the CEO in 2018, the IPS report said. According to the Tesla proxy statement, this award will fully vest over 10 years if the company's market capitalization increases to $650 billion (from a current $42 billion) and if the CEO achieves 12 of 16 performance benchmarks.
