Networks focus on ‘staggering’ pay and pensions for Exxon and other corporate CEOs, even as media companies fight SEC rule on disclosing high salaries.
Gas price rage has blended with executive pay rage recently, since the media have been bashing ExxonMobil’s departing CEO, Lee Raymond, for his pay and pension package.
“Runaway pay,” said NBC’s Brian Williams on April 20, calling executive salaries and benefits “stratospheric” and “staggering.” CBS’s Bob Schieffer compared Raymond’s “golden” retirement to the “average American” on April 13. “How much is too much?” asked NBC’s Matt Lauer on April 11. And ABC’s “Good Morning America” said, “You Must Be Kidding!” referring to Raymond’s package as “stunning” on April 14.
Criticizing highly-paid executives has been in vogue at the news networks lately, but there’s something the anchors aren’t telling you: their colleagues’ top wages could soon be disclosed to the world, and Big Media are fighting it.
Large media companies have been doing everything within their power to hide the compensation plans of their own highest-paid employees from public disclosure. As reported by the Associated Press on April 11: “Some big media and entertainment companies hope to keep under wraps the perks and income of their stars and celebrities, challenging a Securities and Exchange Commission proposal that's being called the ‘Katie Couric clause.’” None of the broadcast networks reported the companies’ protest.
According to the AP, the “Katie Couric clause” is a January 2006 SEC proposal that would “require a company to disclose the pay details of as many as three non-executive employees whose individual compensation exceeds that of any of its top five executives.”
Given the incentive packages of folks like Couric – rumored at $15 million for her new “CBS Evening News” gig – such a regulation if adopted would hit close to home for top broadcasters who complain on the air about what oil executives and other Big Businessmen make. Five media corporations, including CBS Corp., filed a letter with the SEC on April 10 arguing that “compensation information should be treated as a trade secret.”
Yet, as highly paid lawyers squabbled to keep the incentive packages of America’s television personalities private, the media hypocritically spent much of April complaining about what corporate executives made. In the forefront was The New York Times, which actually ran 11 articles and editorials on this subject from April 9 through April 16, with eight of them occurring in just one day. See sidebar: Hypocrisy at the NY Times
Do CEOs Earn Their Pay?
Of course, the Times wasn’t the only outlet in April throwing rocks at executives and their wages. The three broadcast networks stirred the class warfare pot, downplaying CEOs’ performance as heads of their companies.
On April 20, the “Nightly News” did a segment entitled “Outrage Over CEOs’ Huge Compensation Packages.” Brian Williams began: “We're back with NBC News In Depth tonight: runaway pay. A lot of attention is being paid these days to the stratospheric sums that some CEOs make in this country.” Williams continued: “Lee Raymond, ExxonMobil recently retired CEO, whose salary alone was over $51 million last year. Then there's William McGuire, CEO of United Health Group. He received stock options that could end up totaling a staggering $1.6 billion.”
Williams handed it off to Anne Thompson, who chose not to share with her viewers the fact that ExxonMobil stock is up 85 percent since January 2004, while the company made almost $36 billion in profits in 2005 alone. That benefited the millions of shareholders who make Exxon America’s largest company. Thompson also ignored United Health’s 67-percent increase in share value.
However, Thompson didn’t forget to end the segment by letting her viewers know just how much this kind of compensation differed from what regular Americans make, encouraging viewers to get angry: “Still, the outrage remains with the average CEO taking home by one estimate 431 times what the average worker does.”
ABC’s “Good Morning America” also took on CEOs Raymond and McGuire in April, with both shows featuring the title “You Must Be Kidding!” prominently displayed across the bottom of the screen. Raymond was first to be eviscerated on April 14. Robin Roberts began: “The world's largest oil company has revealed the stunning details of Lee Raymond's retirement deal. Details that left us saying, 'You Must Be Kidding.’"
To its credit, after running through the numbers of Raymond’s retirement package, at least “Good Morning America” pointed out how well ExxonMobil has done under his management. Correspondent Dan Harris said, “The company defends Raymond's compensation, pointing out that during his 12 years running Exxon, it became the largest oil company in the world and the stock price went up 500 percent.”
Six days later, William McGuire was the target when “Good Morning America” reported on United Health Group in another “You Must Be Kidding!” segment. Roberts began: “Now The Wall Street Journal reports the head of one of the nation's largest health care companies is sitting on more than a billion dollars in stock options while 46 million Americans go uninsured.”
Dan Harris then stated incredulously, “While patients, doctors and hospitals have been feeling the pain of rising healthcare costs, the chairman and CEO of United Health Group, Dr. William McGuire, has been accumulating one of the richest batches of stock options ever.” Harris mustn’t have realized such an assertion suggested it would have been better for patients, doctors, and hospitals if all these options McGuire owns were worthless.
Yet, to further drive home the point, Harris interviewed a Minnesota pharmacist who’s “been going to state fairs dressed up as Dr. McGuire, accusing him of corporate greed.” The pharmacist stated, “We feel, as, as health practitioners, we have a moral and ethical obligation to speak out about this.”
Although Harris did state that United Health’s stock has gone up an astounding 7,000 percent since McGuire took over as CEO, this was clearly irrelevant to the “Good Morning America” team as they mocked his wealth at the end of the segment. After Harris quoted McGuire as saying of the executive compensation plan at United Health, “we sleep with good conscience,” Roberts mocked, “You must be kidding.” Harris responded, “He sleeps with a lot of money, too.” Diane Sawyer interjected sarcastically, “Maybe on nice sheets.”
Finally, CBS joined in the CEO bashing during the April 13 “Evening News.” Host Bob Schieffer disparagingly began the segment:
“We have a story tonight that brings new meaning to the term ‘Golden Years.’ The average American enters the Golden Years – retirement – expecting to live on less than $30,000 a year, and that includes Social Security. Well, it turns out to be a little more golden than that if you run a big oil company.”
After running through Raymond’s retirement package, correspondent Anthony Mason broke down how the CEO’s wages compared to the rest of Americans’: “Lee Raymond earned $69 million in his last year as ExxonMobil's chairman. That's $190,000 a day. The average American worker, Bob, earns 43,000 a year.”
Mason also stated how much CEOs make in general: “The average pay for a CEO rose 27 percent last year to more than $11 million. The SEC is now considering new regulations to require companies to disclose more about what CEOs really make.”
Though Mason referenced the new regulations being proposed by the SEC, he failed to mention the “Katie Couric clause,” how that might impact his own industry, or how members of the media are trying to block this initiative.
In fact, not one of the three broadcast networks – in the middle of all their reporting and explicit detailing of what some of America’s executives are being paid – bothered to inform their viewers about the SEC’s new “Katie Couric clause,” or how the industry was trying to prevent similar disclosure of their pay.
Could it be because some of these reporters that are complaining about what CEOs make earn just as much?
An April 6 New York Daily News article confirmed this possibility. According to this report, Katie Couric is going to be paid $15 million a year as the new “CBS Evening News” anchor. And, Diane Sawyer, who was so fascinated by the kind of sheets William McGuire must be sleeping on, likely doesn’t have any problems in that regard, for she earns $13 million a year – $2 million more than the average CEO.
What’s that saying about people who live in glass houses?