The Bain or Bane of Greed

Hostess
This was another example of vulture capitalism.

Before they tried to screw labor again, the executives increased their compensation -- for what? The executives, it is claimed, were trying to also be dishonest with the bankruptcy process at the time.  They KNEW the company was not doing well. Killing the company? It wasn't labor that killed this company, or others; it was the overpaid executives.  THIS is what the GOP represents and supports. This is what they want to deregulate even further - and why we must institute more regulation and enforcement, to keep business honest.  THEY DO NOT DO SO ON THEIR OWN.

From TPM:

BCTGM members are well aware that as the company was preparing to file for bankruptcy earlier this year, the then CEO of Hostess was awarded a 300 percent raise (from approximately $750,000 to $2,550,000) and at least nine other top executives of the company received massive pay raises. One such executive received a pay increase from $500,000 to $900,000 and another received one taking his salary from $375,000 to $656,256.

and

It also follows a trend of rising CEO pay in times of economic difficulty. At the manufacturing company Caterpillar, for example, they froze workers’ pay while boosting their CEO’s pay to $17 million. And at Citigroup, CEO Vikram Pandit received $6.7 million for crashing his company, walking off with $260 million after the business lost 88 percent of its value.

As noted in another TPM story on an economic analysis:

Study: CEO Pay Increased 127 Times Faster Than Worker Pay Over Last 30 Years

In 1978, CEOs took home 26.5 times more than the average worker. They now make roughly 206 times more than workers, EPI found. The pay isn’t always tied to the performance of their businesses — as ThinkProgress has noted, CEOs at companies like Bank of America often pocket huge pay increases even as the company’s stock price plummets and jobs are cut.

Workers’ wages aren’t tied to productivity either. Despite substantial gains in productivity since the 1970s, worker pay has remained flat. According to Labor Department data cited by the Huffington Post, inflation-adjusted wages fell 2 percent in 2011.

As a result, American income inequality has skyrocketed, growing worse than it is in countries like Pakistan and Ivory Coast. Wealth inequality is worse than it was even in Ancient Rome. And, as pay skyrockets and tax rates fall for the richest Americans, the rising inequality has left the bottom 95 percent of Americans saddled with more debt than ever before.

This is pure greed, penigma readers, and short term gain grabbing at the expense of long term economic growth for this country. Worker productivity has increased, but been unrewarded. Executive decisions have trashed this nation - and been grossly rewarded in spite of failure.