Stratospheric Wall Street compensation, tax avoidance by corporations

“The top five U.S. banks paid staff a combined $119 billion for 2010, according to bank consolidated income statements.”  from this Reuters article: Compensation seen rising among bankers: poll.  Add in Goldman Sachs and the compensation comes to about $140 billion.

According to Dollars&Sense

Wall Street financiers received $20.8 billion in bonuses last year on top of pay packets so ginormous they’re almost impossible to fathom. Check this out:

Compensation (pay, benefits, bonuses)
Bank of America          $35.1 billion
Wells Fargo                  $26.1 billion
JPMorgan Chase          $25.4 billion
Citigroup                      $22.6 billion
Goldman Sachs            $17.5 billion
Morgan Stanley            $16.0 billion
Total                            $142.7 billion

This money is too good to let anything get in the way. Think of it like this: the aggregate compensation of Wall Street’s big boys dwarfs the gross state product of 20 of the 50 states. Their booty is the equivalent of 5 Vermonts, or 3 Maines, or 2 New Mexicos, or all of Kansas.  Wrap your mind around that: the total output of Kansas, population 2.9 million, equals executive pay at 6 banks! The mind boggles.

So how startling is it to discover that they dump buckets of money lobbying Congress? Last year the American Bankers Association shelled out just over $3 million, Citigroup spent $5.8 million, JPMorgan spent $7.4 million, Wells Fargo spent $5.4 million, Bank of America spent $3.8 million, and Goldman Sachs doled out $4.6 million. When E.F. Hutton (Citigroup) talks, Congress listens.

Some facts about exorbitant pay and tax avoidance by corporations

  • Executive Pay at Big Companies Rose 23% Last Year. (source)
  • America’s largest global corporations are holding $1.5 trillion dollars in profits overseas in order to avoid US taxes. (source)
  • Goldman Sachs, which received a $10 billion taxpayer bailout, got their effective tax rate down to 1%. (source) They are outsourcing 1000 jobs. (here)
  • GE paid no US taxes on worldwide income of $14.2 billion. (source)
  • In the 10 years ending in 2010, Boeing had $29 billion in profits, and paid minus-$948 million in federal taxes. (source)
  • Twelve major U.S. businesses, with $171 billion in profits, combined to pay negative $2.5 billion in federal taxes the past three years. (source)
  • The IRS estimates that individuals and corporations currently hold $5 trillion in tax haven countries. (source)
  • One year loss in unpaid payroll taxes from businesses: $58 billion (source)
  • Annual cost in oil & gas subsidies: $2.7 billion (source)  First quarter 2011 profits of the six largest oil companies: $38 billion (source)
  • Last fall, Senate Republicans voted unanimously against a bill that would have ended tax breaks for companies that shift American jobs overseas. (source)

Check out this Flash game for kids of all ages: Taxation Dodge Ball: stop tax-dodging corporations.

Taxation Dodge Ball

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