Sunday, May 06, 2012

Let's Talk Money, Honey!

I am already so weary of this so-called "class warfare" thing going on in our political discourse.

For the purpose of what I have to say on the matter, let's remove from the table any discussion of tax rates, what's fair vs. not fair, whether the rich should pay a higher percentage than those at the poverty level, etc.

OK, let me say one thing and THEN we'll take it off the table. The debate at least has some merit. I understand why some people with a rather narrow view might think it's so unfair that someone making $5 million a year is taxed at a higher rate than a family of four trying to get by on $25,000 a year...or less. If you are in the camp that believes everyone, regardless of income, should pay a flat tax of 10% because it's "fair", I think you are full of shit. As soon as a tax rate starts to take basic necessities of life away, then it's too high and unfair.

Someone working minimum wage, or two minimum wage jobs, and trying to support a child while being taxed is going to be forced to do without something basic, and adequate food will quite likely be one of the many sacrifices.  Anyone making $100,000 probably isn't going to need to skip a meal due to finances even at a higher tax rate. Depending on where they live, the yacht might have to wait, but so be it.

Now let's just focus on income rather than tax rates. What do you suppose would be the reaction if the top 3% of our school teachers -- the best of the best -- were being paid $300,000 or $400,000 a year? There would be an uproar the likes of which we'd never heard coming from the right, center, and probably even from some on the left. What about the best of the police? (The ones who aren't out using their clubs and teargas to suppress people exercising freedom of speech.) And what about nurses and firefighters? I can't think of a single ordinary job description which doesn't have some kind of salary range which everyone accepts without question. We all know the kid at the Pizza Hut probably isn't hauling in 70-grand a year no matter how hard he or she might be working, or how great they are at what they do.

I consider myself to be extremely fortunate with my career in advertising (despite my current unemployment). I've always known the positions I've held in the industry were critical for the success of the organization and the client base. If I failed to get creative materials to a media outlet in a timely manner, the advertising campaign could be jeopardized. Having been a media buyer for 12 years, I know that if I don't secure the time slots on desired networks, the commercials will not be seen.  And not to strictly toot my own horn, I also know the commercials themselves have to be compelling enough to get a certain number of average television viewers to pick up the phone or go to the website and order the can't-live-life-without-it widget for $19.95 plus $7.95 shipping.  If they don't, then it doesn't even matter how well I do my part.  No money coming in means I don't have a job, even if I'm the best damn media buyer on the planet.  So thank you creative directors and producers everywhere!

I have worked as hard as anyone in the industry and have played my part in generating tens of millions of dollars in revenue for agencies and clients. A lot of profits have been made as a result of my efforts. All that being said, my compensation has always been salaried with a small percentage of my salary coming as a bonus some years. And by small percentage, I'm talking 10% maximum and as an overall average through the years more like 3%-5%. Regardless of how much revenue I generate or how much profit a client might make as a result of my efforts, I know as a media buyer that I will never make $500,000 a year, nor should I.

I have made as little as $43,000 and as much as $88,000. Those salaries, particularly the latter, would be seen by many people as wonderful and I never took it for granted. The advertising industry is not what I would call stable work and that $88,000 salary lasted less than a year and was followed by 5 months of unemployment and then by a job paying half as much!  Worth noting also is that the highest salary I earned did not come with any benefits whatsoever.  It was freelance work.  No medical, no dental, no paid vacation.

Perhaps because of my experience, and a constant awareness that I've been doing OK because somebody...a LOT of people who might not be doing as well as I am have been ordering a bunch of stuff they see on TV and therefore I knew where my money was coming from ultimately.  I, along with everyone else in these organizations, are making a living thanks to people buying mops, steam-cleaners, hideous knives which are guaranteed to send x number of people to emergency rooms, food dehydrators, hand blenders, appliances which catch on fire after 3 uses, robots to vacuum your floor, 935 different devices to make you thin or have awesome abs, ladders, woks, drills, paint appliers, paint removers, pasta makers, chicken rotisseries, cat piss odor suppressors,  zit removers, teeth whiteners, breath fresheners, memory enhancers, spray-on hair for bald spots, "gold" colored coins being marketed as "investments" that have a fucking fleck of real gold in them worth about 80 cents, and wealth-building methods which, if successful, God-forbid you should pay more in taxes!  And let's not forget pills that make your dick hard so you can always be ready to fuck on a moment's notice.  (Make sure you have health insurance because if that boner lasts more than four hours you need to see a doctor right away!)

Yep, I've always known who butters my bread.

I also take it to the next level.  I look at corporate profits.  Let's take the Waltons for instance.  No, not John, Olivia, John-Boy, Mary Ellen and the rest of them.  I'm referring to the other, slightly more fortunate Walton family....the ones worth about $93 billion, give or take a little, thanks to a thriving chain of retail outlets selling lots and lots of people even more cheap shit than I can fathom. 

I am trying to imagine how anyone makes money that isn't somehow, directly or indirectly, made possible by consumers like us going out and buying stuff.

On a side note, I do appreciate it when someone like Alice Walton comes along and decides to give a little something back to the local community, I don't see that happening nearly enough, and she still could have, and probably would have, if she'd paid 5% more in tax on those billions.  But hey, museum admission is FREE thanks to Wal-Mart!  God bless them.

When I was a child, I remember being able to put 5 cents in a vending machine and getting a cold Coca-Cola in a bottle.  A gallon of gasoline was less than 50 cents and some dude would come out and fill your tank, check your oil, and clean your windows!  With a smile on his face (sometimes).  Back in those days, if you mentioned that you'd bought something made in China you'd probably have been branded a red communist on the spot.

Thanks to corporate greed, it's hard to find an American flag decal for your Hummer that isn't made in China.  And this is where I start to come unhinged.

We pay the same or more for the same products as we did a few years ago when those products were made in North America or even Europe.  Manufacturing jobs vanished as corporations hauled their production to countries where wages are pennies compared to dollars.  Corporations are doing great as a result of these and other tactics aimed at maximizing income and pleasing their shareholders.

As an example I love to use Ray Irani, CEO of Occidental Petroleum, who in 2010 had a salary of $1,191,667.  Not bad.  I'm not sure there's a man or woman on the planet who is actually worth that kind of money, but hey.  I'm sure he has a family to feed just like most other working Americans.  And I'll bet his mortgage payment is a bitch.  So I don't begrudge him for it.   Really, I don't.  I'm sure he hates long meetings and conference calls as much as the rest of us do.

However, I do know that salaries like that are made possible, and only made possible, because people like us are buying shit or services.

But here's the real kicker.  Mr. Irani can certainly survive quite well on that salary.  He might have to make some conservative adjustments here and there.  He might have to save up for 7 or 8 years before he can afford to buy his yacht.  I have no idea what his living arrangements are but it might be rough if he wants a 10,000 square foot home in Los Angeles, even in Compton (if there is such a thing as a home that large in Compton).  Maybe he'd have to settle for 4,000 square feet.  Hey, life's tough and we have to manage it.

But he doesn't just make $1,191,667.  Mr. Irani also raked in a little extra as a bonus in 2010:  $32,975,000 to be precise.

OK, I'll be totally honest here.  I just lost any fucking compassion I might have had over his cost of housing dilemma.   Or how long he might have to wait before he gets his goddamn yacht.  Before all of you start screaming "but...but...what if, like you, he had a rough year in 2009 and only made half of what he was making in 2010!", let me finish.  I'm not done yet.

Also in 2010, Mr. Irani got some stock and options to, you know, help pad his condition a little more just in case he might have been irresponsible in some way and squandered $10 or $20 million after too much rum punch at a black tie gala.  That bumped him up another $40,250,000.  But maybe we shouldn't even count that... it's all just on paper for now.

Total compensation package for 2010:  $76,107,010.

If my 2010 bonus alone, as a percentage of salary had been that much, I would have been given an extra $1,660,279.30 for my superb contributions to the advertising agency.  I would have told them they were out of their minds (after waiting to be sure the check was going to clear the bank).  And then I would have promptly resigned because (a) that's just insane business behavior, (b) it seems unsustainable and would put me under incredible pressure to live up to that value, and (c) I could easily retire very comfortably on that sum.

Now you know why I love using Mr. Irani as my example.  He's not even the top dog in the CEO pyramid for 2010.  That honor goes to the head of Viacom who edged him out by about $8 million. That's OK though because they did OK too based on 2nd quarter financial reports just released on May 3rd. Believe me, that 8:30 AM conference call on Friday was probably worth attending!

In light of all this I totally understand where Mitt Romney is coming from.  These are his people and his world.  And in their eyes it's just not fair that a majority of us want them to pay a higher tax rate than a Mr. and Mrs. Gonzalez trying to make ends meet by pressing out tortillas in Tyler, Texas all day so they can afford to fill up their tanks at the Exxon station on the way to Wal-Mart or Kroger to buy shit for their kids to eat for dinner.

There's just a couple of things I do not understand.  At what point does executive compensation become immoral?  How much is too much?  Do we draw the line at $100 million a year?  And why would anyone in their right mind want or expect to be compensated that much in one year anyway?  It's almost more money than any human could possibly spend unless they want to go the extra mile and do something crazy like...I dunno... what?  Buy an election?  Control the entire political process?  You tell me.

One of the joys in life in setting realistic financial goals and reaching them;  $70 or $80 million a year kinda takes the fun out of that aspect.  Maybe I'm just a little too sensitive because if I was raking in $2 million a year I'd be running a kick-ass food bank or something instead of trying to figure out where my next $60 million was coming from and whether all the liberal socialists were going to jack up my tax rate because of some podunky thing like our educational system falling apart, roads and bridges needing repair, water systems in dire need of updating, and preparing ourselves to be technological stand-outs in the fucking 21st century which, by the way, is already 12% behind us while we squabble over marriage equality and the evils of reefer, both of which will surely, sooner or later, rip apart our moral fiber and destroy our civilization.

But what truly blows my mind to shreds are not the Mitt Romneys of the world, or the people making so much money it can't possibly be spent on any personal "needs" without appearing to be a complete and total self-absorbed prick with horrific taste in chandeliers.  If a family of 8 could live comfortably in your master bath and walk-in closet, you might need to take a step back and self-evaluate.

What I'm throwing my hands in the air about are the people like you and I, who are making $25k a year, $50k a year, $75k a year and are actually having to feed and educate their children, and keep them clothed, and look after their health care needs, make sure the mortgage payment is sent in on time,  try to sock a little back for unexpected emergencies, and plan for retirement, all of which are generating more wealth for those corporations who control this system, while these very struggling people simultaneously weep these ridiculous tears that it would be so unfair to tax the rich at a higher rate than anyone else, and because those of us who are actually blessed with a functioning conscience, we must be Marxists and anti-American.  (Or French.)

I am not a Christian but all of this is enough to make me wish Jesus would come back right this instant and yank so many of his followers' heads out of their asses.  But I have a hunch we're just going to have to let this play out, and the ride is not going to be one of joy.

Thanks for listening, and Vive la France!


6 comments:

Miss Cellania said...

I hear ya. In my income range, there is no saving or planning for retirement. At this point, I'm looking forward to someday buying health insurance for myself, either when (and if) the Obamacare tax subsidies kick in in 2014 or when the kids all leave home and my grocery and gas bills go down.

TheCunningRunt said...

You just coaxed more reading out of my collapsing cortex than anyone has since I lasted posted such a rant myself. Very lucid for a guy who likes to unwind as you do.

Thank you for being on our team.

konagod said...

It's not my unwinding methods that limit my posting. It's my attitude of resignation and disgust at what's going on right now. But once in awhile I just can't help myself and I need to pound one out.

TheCunningRunt said...

Carry On, Thumper! ;)

Unknown said...

This is without a doubt the best written (and funniest) take on the current state of affairs in our country that I have read. I am a huge Bill Maher fan (saw him at the Waikiki Shell for New Year's Eve), but even Bill couldn't have stated the situation as well or as interestingly as you have. It sickens me that after serving in the military during Vietnam, then doing two tours as a civilian in Iraq, another in Afghanistan and three years in Bogota, Colombia in service to my country, I pay a 28% net tax rate while Mitt Romney who has never done anything useful and lives mostly off money inherited from his Daddy makes 30 times what I do and pays half the tax rate!

Eric Wilde said...

Wealth tax, baby.