The Washington Independent
The Washington Independent

America’s super-rich continue to make mind-boggling sums

Two recent metrics examine 2010 take-home among the super-rich — that top one-hundredth of one percent of Americans whose median household income exceeds $27

Tobey Strickland
News
Last updated: Jul 31, 2020 | Apr 05, 2011

Two recent metrics examine 2010 take-home among the super-rich — that top one-hundredth of one percent of Americans whose median household income exceeds $27 million a year, nearly 1,000 times what the bottom 90 percent of Americans make. USA Today’s CEO pay survey and a look at hedge fund manager earnings from Absolute Return + Alpha (AR), a magazine dedicated to hedge funds, both reveal that even as hundreds of millions of Americans remain mired in the recession, top earners, like the companies they work for, are doing better than ever.

Viacom CEO Philippe Dauman topped the USA Today list, with a combined $84.5 million in pay, between a $2.6 million salary, an $11.25 million bonus and a $70.5 million return on stock options in 2010. Hovering near the bottom were executives like Steve Jobs, John Mackey of Whole Foods and Vikram Pandit of Citigroup, whose symbolic $1 annual salaries belie massive net worths thanks to their holding stock in their respective companies. Though Jobs’ $8.3 billion and Mackey’s $1.8 billion dwarf Pandit’s net worth, estimated in the tens of millions, as of this year, Pandit will earn $1.75 million, exceeding what he was earning before the recession hit.

All told, the 175 CEOs that USA Today collected data on made a combined $1.84 billion, with a median annual pay of $8.8 million. This represents a 26 percent jump in annual pay from 2009; average private industry workers, on the other hand, saw pay raises of 2.1 percent over the same period.

Meanwhile, hedge fund managers are making money that makes CEO income look pitiful by comparison. The top 25 hedge fund managers in the U.S. made a combined $22 billion, bolstered by surging gold prices and a generally bullish market. This works out to an average of $883 million in 2010 income for those 25 managers, the third-highest in history.

Far and away the top earner among them was John Paulson of Paulson $ Co., who personally made $4.9 billion in 2010, largely in gold. Other hedge fund managers invested heavily in the emerging lawsuit market, lending millions to law firms heading up major class-action suits. Interest on the loans is passed on to the firm’s clients in additional fees, meaning that many plaintiffs who are victorious in class-action suits end up paying for the “privilege” of winning.

Even assuming Paulson works at the high-end of the industry standard for people working for hedge funds — say, 60 hours a week — his astronomical pay would break down to about $436 per second on the job. It would take him one minute and 48 seconds to earn the median yearly income for American men.

Despite their massive haul in 2010, hedge fund managers continue to exploit a controversial “carried interest” tax loophole that allows them to pay a maximum of 15 percent on the vast majority of their income, as opposed to the 35 percent that others in the top tax bracket are required to pay. Efforts (PDF) to close the loophole in the past have been unsuccessful.

Tobey Strickland | Reiki Master. In the process of becoming a real estate mogul. Brewery aficionado. Netflix series critic who is semi-professional. Every day, I assist clients in locating their ideal dream house. After I finish my work for the day, you can find me at Crossfit, doing yoga, or meeting up with friends to listen to live music around town. I enjoy traveling regularly, whether it's relaxing on a South American beach or hiking through Asia's mountains. Now it's your turn. What are your favorite places to visit?

Related

$1.89 billion given to states to fight HIV

The federal government Monday announced more than $1.89 billion in funding to states to fight the HIV epidemic with access to care and with more cash for the failing AIDS Drug Assistance Program. According to an HHS press release , $813 million of that money will go directly to the ADAP programming. An additional $8,386,340 will be issued as a supplement to 36 states and territories currently facing a litany of unmet needs and access issues.

Army Data Shows Constraints on Troop Increase Potential

If President Obama orders an additional 30,000 to 40,000 troops to Afghanistan, he will be deploying practically every available U.S. Army brigade to war, leaving few units in reserve in case of an unforeseen emergency and further stressing a force that has seen repeated combat deployments since 2002.

1. Brian Schweitzer

As governor of Montana, Schweitzer doesn’t represent one of the most highly populated, high-profile electoral states in the country. But this

$1.3 Million for Brown

The GOP’s candidate in the Massachusetts special election raised more than one million dollars -- double the goal -- in a 24-hour moneybomb on the Ron Paul

$1.3 trillion in federal spending unaccounted for, report finds

Despite calls for independent bodies to keep government accountable, the Sunlight Foundation’s most recent Clearspending report has found the federal

#1 in Conspiracy Theories

Andrew Young’s tell-all biography of John Edwards, hitting shelves next week, is surging in one Amazon.com category in particular. #1 in Conspiracy

1 Brigade and 1 Battalion

ISTANBUL – It’s 10 p.m. in the lowest level of the Istanbul airport. In 20 minutes I’ll be allowed to board my plane to Kabul, bringing me to the

$1 Million for Toomey

Pat Toomey, the former Club for Growth president and leading Republican candidate in Pennsylvania’s 2010 Senate race, has announced a $1 million haul in the

1. Lindsey Graham

Sen. Graham (R-S.C.) is typically regarded as a reliable vote for his party, but he took the bold step of breaking with his fellow Republicans to join Kerry

Bachmann uncomfortable over earmarks ban

Republicans appear to have boxed themselves into a corner with their portrayal of earmarks as wasteful spending, as many of them have backed a moratorium on

Troubled mine holds hope for U.S. rare earth industry

China currently controls 97 percent of the world’s rare earth production. The Mountain Pass Mine could change that -- if it can overcome serious environmental concerns.

© Copyright 2021 The Washington Independent All Rights Reserved

Terms & Privacy | twi.news@washingtonindependent.com