October 27, 2013
Thank you. I support the regulation to reveal pay ratio disclosure.
We all live in our nation's economy, our lives are directly affected. We suffer from extreme inequality. Presently the lower-earning half of U.S. workers earn only 7% of total personal income. Roughly 75 million employees who submitted W-2 forms to the Social Security Administration earned $741 billion in 2011, the most recent report available --- see http://www.ssa.gov/cgi-bin/netcomp.cgi?year=2011 ---
The Congressional Committee on Taxation, report for tax year 2012, reports total taxable income at $11.468 trillion. The income amount to the lower-earning half comes to less than 7% of total personal income.
We depend -- as in our lives depend -- on our economy providing us with opportunity to develop our talents, provide us with security. Consumer purchasing comprises about 70% of all economic activity in the nation. When half of all consumers have so little income, their consumption is severely limited. Marriner Eccles, the chairman of the Federal Reserve, made classic statements in this regard as to the cause of the Great Depression of the 1930s.
Furthermore, between December 2000 and June 2011, 11 and a half years, there were on net no new private sector jobs created in the U.S., as in zero new jobs, even though the "working age population" or the civilian non-institutional population grew by over 30.7 million people, about a 15% increase. This 15% increase should have generated an increase of 15% in private sector employment. I calculate that about 16 million private sector jobs were the number of expected jobs that failed to materialize. This points to a on-going weakness of our current economy -- the failure to create jobs. Since 2008 the employment to population ratio has fallen from 63.3% to 58.2%, a drop of 5.1%, or equivalent to a drop of 12,554,000 jobs. The supposed recovery has recovered just 0.4% of this 5.1% drop. About 12 million jobs are missing from the 20 year average employment to population ratio. There are about 25 million either out of work or unable to find full-time work. See the National Jobs for All Coalition web page, employment, for a full picture -- http://www.njfac.org/jobnews.html. Combined with the 25 million are 18 million who work full-time and year-round for less than poverty level wages, or a total of 43 million in a workforce of 155.6 million, 28% of all workers. And add to that fact that 47% of all workers earn annually less than $25,000 a year, while the average income per worker per year would be around $74,000. The average worker contributes more than $110,000 to the annual GDP, a fact that was recently posted on the Federal Reserve's web pages at the San Francisco FRB site. Yet half are earning less than a third ($25,000) of the mean average worker income ($74,000). The Bureau of Economic Analysis states that $39,215 is the post-tax disposable income for all humans in the U.S., a much higher "average", this would bring my workers' average to about $80,000, and that is a post-tax income average.
As I calculate, using the U.S. Census page on "Employment Size of Firms" about 78% of all employees work for private corporations. Some 84% of those employees work at firms with more than 20 employees, 50% work at firms with more than 5,000 employees. These workers and the rest of the nation would do well knowing the salaries and incomes of their owner/manager employers.
Most everyone understands the model for a vibrant economy: we all buy from and sell to one another, we are interdependent. It's time to highlight this interdependency for the sake of all of us and our future generation.
The income ratio disclosure law is not a frivolous requirement in a democracy. It may prove to be a lifesaving law.
Thank you, Ben Leet
I write an economics blog, http://benL8.blogspot.com