My Plan to Stop Corporate
Abuses
By JOHN
EDWARDS
January 2,
2008; Page A11, The Wall Street Journal
The basic bargain of America -- that everyone should have a
chance to work hard and build a better future -- is falling apart.
Families are working longer hours, but skyrocketing education and
health-care costs, the foreclosure crisis and stagnant incomes have made
it harder for working Americans to provide a better future for their
children.
Not everyone in America is struggling. Investors on Wall
Street took home a record-setting $38 billion in bonuses this past year,
even after losing millions in the credit meltdown.
In 1960, the average CEO made 41 times what the average
worker made. But in 2005, the average CEO made over 400 times the average
worker's salary. The share of corporate profits going to CEO pay has
doubled since the 1990s. Meanwhile, the value of the minimum wage has
plummeted 30% since 1979.
Don't get me wrong -- it is a good thing that some
Americans are doing well. The son of working class parents, I have been
blessed with extraordinary success in my own life and now want for no
material thing. The problem is that the successes of our economy are no
longer shared. Forty percent of all economic growth over the past 20 years
has gone to the top 1% of American families.
The success of our own economy demands that we uphold our
country's values: fair reward for work and opportunity for all. To meet
these goals, we must renew America's basic bargain with the middle class
and remove the stranglehold that entrenched corporate interests have on
Washington.
The first thing we need to do is to make affordable,
high-quality health care a part of the social compact. Not only are
health-care costs putting a huge strain on American families and our
competitiveness in the global economy, but a system that leaves 47 million
Americans without health care is a moral disgrace. As president, universal
health care will be my number one domestic priority.
Second, we also need to adapt retirement savings to the
modern work environment. In the past, it was common for people to stay
with the same company their entire career, and so it made sense for
pensions to be connected to employers. Today, the average worker will
probably hold jobs with multiple companies.
As president, I will create a new universal retirement
account requiring every business to automatically enroll its workers in at
least one plan: a traditional pension, a 401(k) or an IRA. Workers will be
able to choose to have their contributions deducted automatically from
their paychecks, and they will be able to carry these accounts with them
from job to job.
We can't allow fundamentally healthy companies to go into
bankruptcy just to avoid keeping their promises to employees, or to emerge
from bankruptcy with millions for executives and nothing for workers. As
president, I will ensure that corporations honor the pension promises
they've made to workers, by giving workers a claim for lost pensions, just
like lost wages.
Third, our companies should be run for the benefit of
workers and shareholders as well as insiders. Today, too many companies in
America are putting far too much of their earnings into excessive CEO and
executive pay, when this money could be going to increased worker
salaries, better benefits and investments in plants and equipment.
As president, I will immediately cap untaxed deferred
compensation for executives. I will also give shareholders new rights and
responsibilities so that they can call shareholder meetings, remove
directors who aren't acting responsibly, and have a say on executive
pay.
Globalization, technology and demographic change have
transformed our economy. Corporations have adapted, but our basic bargain
with America's workers has not. We are living in a 21st-century economy,
but are asking our workers to compete with a 20th-century set of
tools.
In order to fulfill our obligation to future generations of
Americas, we must restore balance between America's corporations and
America's working families. Only then will we be able to guarantee that
anyone who is willing to work hard and do the right thing has the
opportunity to share in our nation's prosperity.
Mr. Edwards, a Democrat and a former senator from
North Carolina, is running for president.