WHEREAS:
During the period 1989-1995 and even during the recovery years since 1991 inflation-adjusted hourly wages have been stagnant or declining for the vast majority of the workforce, including:
- the bottom 80% of men and the bottom 70% of women
- men with a four-year college education
- men without college degrees
- women with less than a four-year college degree; and,
WHEREAS:
In 1993, the wages paid to male high school graduates was 30% less than the wages their counterparts received in 1979. For female high school graduates, it was 18% less than their counterparts; and
WHEREAS:
Business profits have been fueled by stagnant or falling wages. Hourly compensation would have been $120 billion dollars, or 4.0%, higher for all workers in 1994 had profit rates remained at their 1952-79 average during the 1990s; and
WHEREAS:
In 1960, CEOs earned 12 times the average wage of a factory worker at the same place of employment. By 1974, the CEO's wages had grown to 35 times that of the company's average worker and by 1995, the CEO earned 135 times as much in wages and compensation as did the average worker at the same place of employment. At the top ten corporations, the CEO out earns the average worker by 225 times; and
WHEREAS:
At the same time that many of the top companies have laid off workers during the last three years, the CEOs of these companies have reaped windfall earnings. On the same day that the CEO of AT&T — who earns $5 million annually — announced that AT&T would lay off 40,000 workers, the value of his stock portfolio went up by $5 million; and
WHEREAS:
The late Walter Reuther first proposed that the Big Three auto companies share profits with their workers during the UAW's negotiations just after World War II, but no American corporation has ever agreed to a realistic and continuing profit-sharing plan, remaining instead committed, as the CEO of Scott Paper said recently on ABC's "Nightline" to work only for corporate shareholders; and
WHEREAS:
These same companies encouraged a false sense of security among their workers prior to massive layoffs by participating in labor-management relationships; and
WHEREAS:
In 1994, corporate profits rose 11 percent, after a 13 percent rise in 1.993, and at the same time, companies laid off workers in record numbers; and
WHEREAS:
After-tax profit rates in 1994 were the highest in 25 years and greater than at the end of earlier post-war recoveries. This higher profitability has not resulted from improved productivity based on increased investments. In fact, net investments as a share of GDP has been at a post-war low in the current recovery, averaging about 1.5%; and
WHEREAS:
The percentage of corporate income paid out as taxes has fallen sharply from an average of 44.3% between 1952-79 to 32.4% in the 1980-89 period. It fell slightly further to an average of 31.0% in the current 1990s cycle. Despite the corporate tax reforms of 1986, including the Alternate Minimum Tax, companies like Exxon, Dow and countless others take advantage of loopholes even to the point of charging US taxpayers for their costs and fines for events such as the Exxon Valdez pollution disaster and breast implant litigation costs; and
WHEREAS:
Higher after-tax profit rates are partially due to lower taxation. Had the tax rate on capital income remained at its 1952-79 average, then government revenue would have been $40 billion more in 1994 — an amount equal to 25% of the fiscal deficit that year; and
WHEREAS:
A Republican provision in the Budget Reconciliation bill would allow companies to take money from ongoing pension trusts. This bill puts workers, retirees, the Pension Benefit Guaranty Corporation (PBGC) and national savings at risk to fuel mergers and takeovers that ultimately lead to. further job losses.
NOW THEREFORE BE IT RESOLVED THAT:
AFSCME support passage of the Corporate Responsibility Act (HR 2534) that calls for eliminating $800 billion in federal tax breaks, subsidies, and other federal benefits for corporations and upper-income individuals and HR 1842 that forbids the use of federal funds to support activities that simply relocate jobs from one state to another; and
BE IT FURTHER RESOLVED THAT:
AFSCME and its membership will work in state legislatures and city councils to pass corporate accountability bills to spearhead the movement at this level; and
BE IT FURTHER RESOLVED THAT:
Information exposing campaign contributions by "deadbeat corporate citizens" for preferential tax treatment will be utilized for grassroots education of union members as well as the public; and
BE IT FURTHER RESOLVED THAT:
AFSCME urge the Executive Council of the AFL-CIO to mount a campaign through its affiliates to educate the public about these issues through paid and unpaid media in targeted areas.