The first forum of the Middle Class Prosperity Project

February 24th, 2015 at 5:45 pm

I just got back from presenting this text and these figures at a this Senate forum on inequality, mobility, and middle-class prosperity and the lack thereof, with a heavy emphasis on policy. The project is the brainchild of Sen. Elizabeth Warren and Congressman Elijah Cummings, and I strongly recommend listening to what they had to say, along with that of my fellow panelists.

Looking forward to seeing where they take this project. They’re deeply engaged in the issues and I thought Rep. Cummings remarks at the end in response the question “why bother?” were resonant. And you would be awfully hard pressed to find someone speaking with more authority and passion on the need to reconnect growth and prosperity than Sen. Warren.

Print Friendly, PDF & Email

3 comments in reply to "The first forum of the Middle Class Prosperity Project"

  1. Dennis says:

    I’m not sure how Senator Warren and Congressman Cummings will be able to get much publicity for this project. Forums on the economy tend to be boring for the average Joe Citizen. The populist message is on target and is needed at this time, but I don’t see how a series of forums with scholars, economists, and experts will mobilize a big movement that gets a lot of interest and headlines. And with the current congress, there will never be any legislative actions that address major issues that are highlighted in this project. But this project could help Senator Warren get her populist message strengthened and polished for a 2020 presidential run.

  2. Fred Donaldson says:

    Employers are regulated to prevent 401k plans to be designed only for the top executives, and firms, as the IRS CODA rule requires:

    “Under a CODA, participants may elect to have their employer contribute a specific amount to the plan in lieu of receiving it in cash as wages. In order to satisfy the requirements of section 401(k), the plan must satisfy the Actual Deferral Percentage (ADP) test. The ADP test requires that the deferral of income into the CODA by highly compensated employees be proportional to that for non highly compensated employees.”

    Extending this rule for stock options and other bonuses to all employees would result in a quick end to these abusive compensation plans for the top dogs.

  3. Arnie Schultz says:

    I wish somebody would clarify the issue of compensation of corporate managers, and actually a lot of lower level employees in a corporation . Valerie Wilson mentions that a corporate manager at the highest level, a so-called CEO, gets 300 times the amount in compensation of bottom workers. But most of that money is in the form of stock options being exercised by the CEO, or other managers. But when that happens the money comes from the stock being sold on Wall Street by a bank down the street and not the company. The CEO of United Health here in Minnesota made over $500 million dollars in the decade or two he was in the job’ There were a half dozen letters of protest in the Minneapolis newspaper complaining about the outrageous compensation of the CEO, a pulmonary doctor who said he knew nothing about finance. Most or all of the letter writers were concerned that the CEO somehow was extorting the money from staff doctors or nurses or patients in the hospital. Legislation passed by Congress in the early 1990s limited salaries of corporate managers to annual salaries of no more than one million dollars, with anything above that amount being non-deductible as a business expense. That legislation came about when the Dayton Hudson company in Minneapolis raised the million dollar salary of its CEO by $250 thousand dollars. The Dayton Hudson CEO would have become the first corporate manager to make more than a million dollars a year As a result, corporations began compensating its managers with stock options instead of money, a revolution in corporate finance that began just in time for the historic Bull market on Wall Street of the next two decades. .