Weekend Economists Going to the Dickens December 16-18, 2011

[Demeter]

13. From Mark Karlin Editor, BuzzFlash at Truthout

More and more, the American economy appears to be boiling down not so much into the creative power of entrepreneurialism, but rather into who is conniving and ruthless enough to take advantage of institutionalized concentrations of wealth.

What does that mean? It means that, perhaps, the majority of the super-rich get richer not by creating jobs or increasing the prosperity of the nation; they enhance their wealth by being the "Mack the Knives" of capitalism. That's why it may be no surprise that CEO pay (adjusted to include other compensation) jumped 36.5 percent last year, according to a report cited in CNN:

The average pay hike (36.5%) is for the top executive at each of the Standard & Poor 500 companies, according to GMI, the research group formerly known as the Corporate Library. A broader survey of CEO pay at 3,000 companies posted an average 27% increase.

This further represents that the current crisis of capitalism is exemplified by a corporate and financial sector in the US that frequently benefits from job elimination in order to maximize shareholder profits and CEO pay. Further proof that the top tier of the 1 percent are often there through their skills in surviving corporate infighting - not due to their acumen at growing the economy or increasing jobs - is this paragraph from a December 15 Guardian UK article:

2010 was a great year to lose your job as a CEO. Four of the 10 highest paid CEOs were retired or departing executives. Ronald Williams, former head of Aetna, a health insurer, exercised 2.4m options for a profit of $50.4m. Aetna's stock price declined by 70 percent from when Williams assumed the role of CEO in February 2006 until his retirement. At pharmacy chain CVS, Thomas Ryan made a $28m profit on his options. During Ryan's 13-year tenure as CEO, CVS Caremark's stock price decreased almost 54 percent.

While the unemployed and the working poor get Scrooge-like lectures about how adversity makes one stronger and builds a financial system that rewards those who succeed, a decaying status quo of big business economically lavishes wealth on those who drive companies into the ground..."The reality is that prospects for the poor and the near poor are dismal," said Sheldon Danziger, a University of Michigan public policy professor specializing in poverty told the AP. "If Congress and the states make further cuts, we can expect the number of poor and low-income families to rise for the next several years."

There is a "members only" club for gluttonous wealth in America, and it has little to do with competence.