The federal government alone, a new Congressional Budget Office report calculates, annually spends $500 billion – that’s half-a-trillion dollars – to purchase goods and services from private companies. State and local governments spend many billions more on top of that. (Photo: Pocketing Money via Shutterstock)
The taxes we all pay should bankroll quality public services, not grand fortunes.
Conservative pundits and politicians routinely divide our US economy into two totally distinct spheres. We have the noble private sector over here, they tell us, and the bumbling, bloated public sector over there.
In reality, of course, we have just one economy, with the private and public sectors inextricably entangled. Each year, in fact, hundreds of billions of tax dollars end up flowing directly into the private sector.
The federal government alone, a new Congressional Budget Office report calculates, annually spends $500 billion – that’s half-a-trillion dollars – to purchase goods and services from private companies. State and local governments spend many billions more on top of that.
We’re not talking trickle here – we’re talking cascade, as our elected leaders rush to privatize services that public employees previously provided.
This massive privatization of everything from prisons to public schools hasn’t done much of anything to make the United States a better place to live.
On the other hand, this privatization has paid off quite handsomely for America’s most affluent. They’re collecting ever more generous paychecks, courtesy of the tax dollars the rest of us are paying.
In Washington, D.C., for instance, top officials of the private companies that run many of the city’s charter schools are taking in double or triple what traditional public schools take in, or even more.
The CEO at one company that runs five of these charters, The Washington Post recentlyreported, pulled in $1.3 million in 2013. That’s nearly five times the pay that went to the top public official responsible for the District of Columbia’s 100-plus traditional public schools.
America’s taxpayer-funded military contractors would, of course, consider that chump change. The CEO at Lockheed Martin, for one, personally pocketed over $25 million in 2013.
So do you like this idea of executives in power suits raking in multiple millions of your tax dollars?
Rhode Island state senator William Conley sure doesn’t. He and four of his colleagues have just introduced legislation that would stop the stuffing of tax dollars into the pockets of wildly overpaid corporate executives.
Conley’s bill directs Rhode Island to start “giving preference in the awarding of state contracts” to business enterprises whose highest-paid execs receive no more than 25 times the pay of their median – most typical – workers.
Back in the middle of the 20th century, only a handful of top corporate executives ever made more than 25 times the pay of the average worker. Today, by contrast, only a handful of top execs make less than 100 times median pay.
If Conley’s bill becomes law, the ramifications could be huge.
That’s because we may soon know, for the first time ever, the exact ratio between CEO and median worker pay at every major American corporation that trades on Wall Street.
Five years ago, legislation that mandates this disclosure passed Congress and made it into law. Intense corporate lobbying has been stalling its enforcement, but the stall may soon end. The federal Securities and Exchange Commission finally appears ready to issue the regulations needed to enforce full pay ratio disclosure.
CEO-worker pay comparisons for individual companies will likely start hitting the headlines the year after next. With these new stats, taxpayers will be able to see exactly which corporations feeding at the public trough are doing the most to make America more unequal.
With this information, average taxpayers could then do a great deal. They could, for starters, follow Senator Conley’s lead in Rhode Island and urge their lawmakers to reward – with our tax dollars – only those corporations that pay their workers fairly.
Help us Prepare for Trump’s Day One
Trump is busy getting ready for Day One of his presidency – but so is Truthout.
Trump has made it no secret that he is planning a demolition-style attack on both specific communities and democracy as a whole, beginning on his first day in office. With over 25 executive orders and directives queued up for January 20, he’s promised to “launch the largest deportation program in American history,” roll back anti-discrimination protections for transgender students, and implement a “drill, drill, drill” approach to ramp up oil and gas extraction.
Organizations like Truthout are also being threatened by legislation like HR 9495, the “nonprofit killer bill” that would allow the Treasury Secretary to declare any nonprofit a “terrorist-supporting organization” and strip its tax-exempt status without due process. Progressive media like Truthout that has courageously focused on reporting on Israel’s genocide in Gaza are in the bill’s crosshairs.
As journalists, we have a responsibility to look at hard realities and communicate them to you. We hope that you, like us, can use this information to prepare for what’s to come.
And if you feel uncertain about what to do in the face of a second Trump administration, we invite you to be an indispensable part of Truthout’s preparations.
In addition to covering the widespread onslaught of draconian policy, we’re shoring up our resources for what might come next for progressive media: bad-faith lawsuits from far-right ghouls, legislation that seeks to strip us of our ability to receive tax-deductible donations, and further throttling of our reach on social media platforms owned by Trump’s sycophants.
We’re preparing right now for Trump’s Day One: building a brave coalition of movement media; reaching out to the activists, academics, and thinkers we trust to shine a light on the inner workings of authoritarianism; and planning to use journalism as a tool to equip movements to protect the people, lands, and principles most vulnerable to Trump’s destruction.
We urgently need your help to prepare. As you know, our December fundraiser is our most important of the year and will determine the scale of work we’ll be able to do in 2025. We’ve set two goals: to raise $100,000 in one-time donations and to add 1300 new monthly donors by midnight on December 31.
Today, we’re asking all of our readers to start a monthly donation or make a one-time donation – as a commitment to stand with us on day one of Trump’s presidency, and every day after that, as we produce journalism that combats authoritarianism, censorship, injustice, and misinformation. You’re an essential part of our future – please join the movement by making a tax-deductible donation today.
If you have the means to make a substantial gift, please dig deep during this critical time!
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