Happy New Year to the 1 percent

• “The money power preys upon the nation in times of peace and conspires against it in times of adversity. I see in the near future a crisis approaching that causes me to tremble for the safety of my country. The money power of the country will endeavor to work upon the people, until the wealth is aggregated in a few hands, and the republic is destroyed.”
  Abraham Lincoln

• On average, the richest 400 Americans saw their wealth go up by an astounding $500 million each in only one year (2012) -- a bad year, no less, for the economy.  
• Just this one year's increase in wealth for the richest 400 is enough to hire approximately 5 million entry level teachers!
• All totaled, the 400 richest Americans have the same amount of wealth as approximately 25.5 million middle class families in the center of the wealth distribution.
• This is the new math of plutocracy: 400 super-rich = 25.5 million middle class.      
• The median family -- that family exactly at the mid-point of the wealth ladder  --- saw its net worth collapse. In 2005, the median family's wealth was valued at $102,844 (in inflation adjusted dollars.)  By 2011, the latest Census figures showed a drop of 35 percent to $66,740.  

The CEO of an S&P 500 Index company made, on average, 380 times the average wages of U.S. workers in 2011.

McDonald’s $8.25 Man and $8.75 Million CEO Shows Pay Gap

By Leslie Patton - Dec 12, 2012 12:00 AM ET Bloomberg

Tyree Johnson scrubs himself with a bar of soap in a McDonald’s (MCD) bathroom and puts on fresh deodorant. He stashes his toiletries in a Kenneth Cole bag, a gift from his mother who works the counter at Macy’s, and hops on an El train. His destination: another McDonald’s.
Johnson isn’t one of Chicago’s many homeless people who seek shelter in fast-food joints. He’s a McDonald’s employee, at both stores -- one in the Loop, the other about a mile away in the shadow of Holy Name Cathedral.

Enlarge image

 He needs the makeshift baths because hygiene and appearance are part of his annual compensation reviews. Even with frequent scrubbings, he said before a recent shift, it’s hard to remove the essence of the greasy food he works around. “I hate when my boss tells me she won’t give me a raise because she can smell me,” he said.

Johnson, 44, needs the two paychecks to pay rent for his apartment at a single-room occupancy hotel on the city’s north side. While he’s worked at McDonald’s stores for two decades, he still doesn’t get 40 hours a week and makes $8.25 an hour, minimum wage in Illinois.
This is life in one of America’s premier growth industries. Fast-food restaurants have added positions more than twice as fast as the U.S. average during the recovery that began in June 2009. The jobs created by companies including Burger King Worldwide Inc. and Yum (YUM)! Brands Inc., which owns the Pizza Hut, Taco Bell and KFC brands, are among the lowest-paid in the U.S. -- except in the C suite.

Pay Disparity

The pay gap separating fast-food workers from their chief executive officers is growing at each of those companies. The disparity has doubled at McDonald’s Corp. in the last 10 years, according to data compiled by Bloomberg. At the same time, the company helped pay for lobbying against minimum-wage increases and sought to quash the kind of unionization efforts that erupted recently on the streets of Chicago and New York.
Older workers like Johnson are staffing fast-food grills and fryers more often, according to data from the U.S. Census Bureau’s Current Population Survey. In 2010, 16- to 19-year-olds made up 17 percent of food preparation and serving workers, down from almost a quarter in 2000, as older, underemployed Americans took those jobs.
“The sheer number of adults in the industry has just exploded” because fast-food restaurants “not only survived, but thrived during the economic recession,” said Saru Jayaraman, director of the Food Labor Research Center at the University of California at Berkeley.

Million Hours

Johnson would need about a million hours of work -- or more than a century on the clock -- to earn the $8.75 million that McDonald’s, based in the Chicago suburb of Oak Brook, paid then- CEO Jim Skinner last year. Johnson’s work flipping burgers and hoisting boxes of french fries, like millions of other jobs in low-wage industries, helps explain why income inequality grew after the 2007-2009 recession ended.