New York Times Doesn’t Practice What it Preaches Concerning Executive Pay
Many of you are likely aware of a book by Peter Schweizer entitled “Do As I Say (Not As I Do).” In it, Schweizer demonstrated the hypocrisy of many popular liberals who espouse one position in public that they clearly don’t follow in their private lives.
Well, it seems that The New York Times is guilty of such hypocrisy. In an article Wednesday concerning a looming shareholder revolt at the Times Company over declining share values, it was revealed that one of the complaints coming from Times’ largest investors is how much upper-managers have been paid during a tough period for the company. In fact, a representative from Morgan Stanley – one of the largest Times shareholders – stated: “‘Despite significant underperformance, management's total compensation is substantial and has increased considerably over this period.’"
Yet, just three days earlier, the Times published a 1024-word, front-page business section article entitled “Fund Managers May Have Pay Secrets, Too”: “Amid all the talk about executive compensation and pay for performance, one group of managers has been pretty much untouched: those who run mutual funds.”
On April 13, The Times published an editorial -- yes, an editorial -- entitled “A Cozy Arrangement” concerning -- you guessed it -- executive pay:
“Runaway pay matters because top executives are snatching more than their fair share of corporate proceeds. More important, it also means that the board of directors is not performing its function as internal guardian of the company's health.”
Have you stopped laughing? Well, it gets better. On April 10, The Times published a 3,912-word, front-page article entitled “GILDED PAYCHECKS: Troubling Conflicts; Outside Advice on Boss's Pay May Not Be So Independent” elaborately addressing such pay disparities and the consultants involved in them:
“For Ivan G. Seidenberg, chief executive of Verizon Communications, 2005 was a very good year. As head of the telecommunications giant, Mr. Seidenberg received $19.4 million in salary, bonus, restricted stock and other compensation, 48 percent more than in the previous year.
"Others with a stake in Verizon did not fare so well. Shareholders watched their stock fall 26 percent, bondholders lost value as credit agencies downgraded the company's debt and pensions for 50,000 managers were frozen at year-end. When Verizon closed the books last year, it reported an earnings decline of 5.5 percent.”
Getting laughed out? Need a break? Sorry, because the day before, on April 9, The Times actually published six articles in one day about this subject starting with one entitled “Spotlight on Pay Could Be a Wildcard”: “The power of sunlight as an antiseptic will be put to the test in the coming months, as the Securities and Exchange Commission completes its most significant overhaul in 14 years of the rules governing what companies must disclose about their compensation of top executives.”
That same Sunday, The Times published an article entitled “How the Pay Figures Were Calculated”: “To measure executive compensation, Sunday Business studied 200 large public companies that filed proxies by March 31 for last year.”
Also that Sunday, “Pay for Oil Chiefs Spiked Like Prices”: “Now, as energy companies reveal the year-end bonuses they paid in December -- just one month after the hearing -- it is becoming evident that many top executives had no qualms about accepting record payouts, even if they were based on profits generated by the same high oil prices that they said they had nothing to do with.”
And “C.E.O. Pay Keeps Rising, And Bigger Rises Faster”: “The average total pay for chief executives rose 27 percent, to $11.3 million, according to a survey of 200 large companies by Pearl Meyer & Partners, the compensation practice of Clark Consulting.”
And “Smaller Fish Are Also Doing Swimmingly”: “Corporate governance watchdogs and shareholder activists have focused much of their attention on the growing compensation packages of executives at the country's biggest corporations, but the people who run smaller companies have also been quietly racking up impressive gains, according to pay experts.”
And, finally, “Off to the Races Again, Leaving Many Behind”:
Yep. Six articles about executive pay on one day, nine in the previous eight. Given the revelations from this recent shareholder revolt, there appears to be only one thing to say to the Times board: Physician, Heal Thyself!
“The average pay for a chief executive increased 27 percent last year, to $11.3 million, according to a survey of 200 large companies by Pearl Meyer & Partners, the compensation practice of Clark Consulting. The median chief executive's pay was somewhat lower, at $8.4 million, for an increase of 10.3 percent over 2004. By contrast, the average wage-earner took home $43,480 in 2004, according to Commerce Department data.”