Senator Mark DeSaulnier’s CEO Pay Bill Headed to Senate Floor

May 25, 2014 14:00 pm · 52 comments

An effort to incentivize fair pay and reign in the growing disparity between CEO and worker pay by Senator Mark DeSaulnier (D-Concord) and Loni Hancock (D-Oakland) is headed to the Senate floor after passing the Senate Appropriations Committee on a 5-2 vote.

SB 1372 creates a new corporate tax table that decreases taxes for employers with sensible differences between CEO and worker pay, and increases taxes on companies with large disparities between CEO and worker pay.

The unprecedented bill has sparked a national conversation about skyrocketing CEO compensation.
“Supreme Court Justice Louis Brandeis warned that we may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both,” Senator DeSaulnier said. “SB 1372 begins to address the growing concentration of wealth at the very top. Out of control income inequality is a direct threat to American democracy.”

“Almost everyone recognizes CEO pay is wildly out of control,” Senator Hancock said. “As former Labor Secretary Robert Reich has pointed out – the growing divergence between CEO pay and that of the average worker isn’t just unfair, it is bad for the economy. The average worker has less purchasing power now than 30 years ago. SB 1372 provides an incentive for responsible corporate behavior.”

Under SB 1372, taxes would decrease for companies in which the CEO makes no more than 100 times of the median salary of workers. Taxes would increase on companies that pay CEO’s 100-400 times more than workers.

According to the AFL-CIO’s Executive Pay Watch, in 2012, the CEO of an S&P 500 Index company received an average compensation of 354 times more than the median US worker.

In 2012, the average CEO pay in California was $5,054,959, while the median worker pay in California was $48,029.

Additionally, SB 1372 imposes a penalty on corporations that shift their employment practices to contract employees.

1 Boneguy1 May 25, 2014 at 2:09 PM

Hey Mark – Does your Bill apply to SEI”F”U and the other Union bosses? How about the disparity between them and the average Union employee? I am sure it does NOT ! Because you sir are in their pockets!

Just another party shot to run corporations out of California your an idiot!

2 bumper morgan May 25, 2014 at 2:18 PM

Communists…

3 Killjoy May 25, 2014 at 2:26 PM

Way to go Mark! Chase even more businesses away from California. Schmuck.

4 mamatosix May 25, 2014 at 3:01 PM

Well I think your energy would be better put to use to cut your pay, your fellow senators pay and the pay and perks of ALL politicians. And to force Obama Care on all of you as well.
May you feel the full impact of what you have done to all of us.

5 Mr. Obvious May 25, 2014 at 3:06 PM

This will drive more companies to reincorporate outside of California and push more tech start-ups to the new “Silicon Valley”-type tech areas popping up around the country.
Far-fetched you say? Just look at the past couple years, it’s already happening. This will just push the numbers higher.
Who will pay the taxes that pay the Senator’s salary once he scares off all the people with money? The job makers and the middle class trying to escape these policies.

6 @#1 May 25, 2014 at 3:07 PM

My wife and I are union members and we couldn’t agree more with you.

7 Elwood May 25, 2014 at 3:07 PM

Oh thank God for Marky Mark!

Now we’ll all make $5 million/year!

8 Anon May 25, 2014 at 3:09 PM

Good. I hope this stops the “race to the bottom” mentality the low-class Claycord posters seem to have. Trolls.

9 waverunner May 25, 2014 at 3:12 PM

Seems like the stockholders of various companies should control this, not lawmakers. Don’t know what the answer is, but does the “average” employee have the brains or knowledge to run large companies? It’s like comparing apples to oranges.

Next it will be that doctors shouldn’t make more than nurses; college officials shouldn’t make more than professors; police or fire officials should not make more than the average cop or fireperson.

Granted, the pay and perks that CEO’s receive is ludicrous, but for lawmakers to put a cap on what they receive is ridiculous. CA is already losing Toyota to TX, and who will be next if this law goes into effect?

10 Eat food May 25, 2014 at 3:31 PM

This is not an issue for government to solve…ridiculous!

11 anon May 25, 2014 at 4:04 PM

Trying to build a reputation before he goes to Congress.

12 Fred May 25, 2014 at 4:24 PM

Since when do the politicians get to override the shareholders??? Once more, spew see meddling of the politicians in private business!

Vote ALL of the idiot incumbents out of office – never to hold another elected office!

Time to move out of CA!

13 Hey Mark... THIS IS GOT TO BE THE STUPIDEST IDEA YOU HAVE HAD YET!!! May 25, 2014 at 4:56 PM

If people do not learn failure “NOW” you will learn it later when it is much harder to learn from your mistakes…
&
What do you do when the money is not there???

Hey have you guys learned to balance your checkbooks yet???

Illegals with drivers licenses, We do not enforce the laws we have now!!

We need to start a recall… Even the Democrats do not like what is going on!!! (WHAT DOES THAT TELL YOU!)

Please let me know how we can get rid of these people!!!!!!!

P.S. TO ALL THE VETERANS AND PEOPLE IN THE MILITARY…
THANK YOU!!!! & MAY GOD BLESS EACH AND EVERY ONE OF YOU!

14 Ghost of Alan Greenspan May 25, 2014 at 5:02 PM

Are we living in America where we practice supply side economics (of sorts) or a planned economy like the old Soviet Union?

15 Lake May 25, 2014 at 5:33 PM

Hum – this will further drive business from California. I suspect corporation will shift compensation to other perks instead of having some social responsibility.

16 Electing Mark to Congress May 25, 2014 at 5:38 PM

would be a grave error on the part of the voting public.

The gullibility of the public is astonishing. Marc only exacerbates existing issues. He has no thought function of his own, he only performs as ordered by evil men in power, just like George does.

Want real change? Vote for anyone but Mark.

17 Govt intervention again May 25, 2014 at 5:39 PM

What give Sacramento to right to interject themselves into what the shareholders of private corporations.

We should tax the politicians who spend campaign contributions that exceed 10 times the salary of the office they seek. When they spend more than they earn to get a job, why do they think they should be able to control what people who have earned their job? Hypocrites one and all.

18 Patriot May 25, 2014 at 5:41 PM

“SB 1372 creates a new corporate tax table that decreases taxes for employers with sensible differences between CEO and worker pay, and increases taxes on companies with large disparities between CEO and worker pay.”

DEFINE SENSIBLE. DEFINE LARGE DISPARITY. SENSIBLE ACCORDING TO YOU ? UNDER WHAT AUTHORITY DO YOU CONTROL HOW MUCH I MAKE AS A CEO OR OTHERWISE ? YOU HAVE NONE ! YOU ARE FUC*&NG CRAZY !

You are nothing more than a career politician who has sold his soul for re elections. You are pandering with divisive ideology. There is no place in America for this crap.

19 Anonymous May 25, 2014 at 5:52 PM

And we wonder why businesses are heading to Texas. Why is it governments business ? Tell me Mark, how about Buster Posey gonna tax him extra ?

20 ClayDen May 25, 2014 at 6:20 PM

And freedom continues to slip away…………………..
Commie.

21 If DeSailnier is so worried about the "little guy" May 25, 2014 at 6:22 PM

why did he cast the killer vote against S.B. 1224 which would have allowed the infinitessimally small percentage of pre 1981 vehicles to be exempt from smog testing. This forces the very people he claims to be worried about to scrap their perfectly fine older cars and go into a never ending spiral of debt to purchase newer vehicles.

22 .... May 25, 2014 at 6:55 PM

An old law from the U.S.S.R. ?
This bill will serve to further accelerate the process democrats have all but perfected, driving business out of our state.

“In the 10th annual survey of CEOs concerning their views of the best and worst states for business, over 500 CEOs across the U.S. responded, grading states with which they were familiar on measures including tax and regulatory regime, the quality of the workforce, and the quality of the living environment”
http://chiefexecutive.net/2014-best-worst-states-for-business

Texas Best at number ONE and CA is Dead LAST as it has been for the last TEN Years.

Imagine the damage to the country he could do if elected to congress.

23 Cal Old Blue May 25, 2014 at 7:04 PM

I’m not going to comment on DeSaulnier’s proposal, but it has triggered the usual sorts of responses from both sides of the political spectrum. I’m currently reading a biography of Teddy Roosevelt and William Howard Taft, and realized times have changed.

Here’s a few hundred-year-old quotes from that noted communist and Republican President, Theodore Roosevelt, about wealth and corporations… for your consideration:

We wish to control big business so as to secure among other things good wages for the wage-workers and reasonable prices for the consumers. Wherever in any business the prosperity of the businessman is obtained by lowering the wages of his workmen and charging an excessive price to the consumers we wish to interfere and stop such practices. We will not submit to that kind of prosperity any more than we will submit to prosperity obtained by swindling investors or getting unfair advantages over business rivals.

A man who has never gone to school may steal from a freight car; but if he has a university education, he may steal the whole railroad.

Of recent years… representative government all over the world has been threatened with a growing paralysis. Legislative bodies have tended more and more to become wholly inefficient for the purposes of legislation. The prime feature in causing this unhealthy growth has been the discovery by minorities that under the old rules of parliamentary procedure they could put a complete stop to all legislative action… If the minority is as powerful as the majority there is no use of having political contests at all, for there is no use in having a majority.

Probably the greatest harm done by vast wealth is the harm that we of moderate means do ourselves when we let the vices of envy and hatred enter deep into our own natures.
But there is another harm; and it is evident that we should try to do away with that. The great corporations which we have grown to speak of rather loosely as trusts are the creatures of the State, and the State not only has the right to control them, but it is duty bound to control them wherever the need of such control is shown.

Our aim is not to do away with corporations; on the contrary, these big aggregations are an inevitable development of modern industrialism, and the effort to destroy them would be futile unless accomplished in ways that would work the utmost mischief to the entire body politic. We can do nothing of good in the way of regulating and supervising these corporations until we fix clearly in our minds that we are not attacking the corporations, but endeavoring to do away with any evil in them. We are not hostile to them; we are merely determined that they shall be so handled as to subserve the public good. We draw the line against misconduct, not against wealth.

Malefactors of great wealth (used in various contexts)

To waste, to destroy, our natural resources, to skin and exhaust the land instead of using it so as to increase its usefulness, will result in undermining in the days of our children the very prosperity which we ought by right to hand down to them amplified and developed.

To permit every lawless capitalist, every law-defying corporation, to take any action, no matter how iniquitous, in the effort to secure an improper profit and to build up privilege, would be ruinous to the Republic and would mark the abandonment of the effort to secure in the industrial world the spirit of democratic fair dealing. (This from one if his state-of-the-union addresses).

The failure in public and in private life thus to treat each man on his own merits, the recognition of this government as being either for the poor as such or for the rich as such, would prove fatal to our Republic, as such failure and such recognition have always proved fatal in the past to other republics. A healthy republican government must rest upon individuals, not upon classes or sections. As soon as it becomes government by a class or by a section, it departs from the old American ideal.

The outcome was equally fatal, whether the country fell into the hands of a wealthy oligarchy which exploited the poor or whether it fell under the domination of a turbulent mob which plundered the rich. In both cases there resulted violent alternations between tyranny and disorder, and a final complete loss of liberty to all citizens — destruction in the end overtaking the class which had for the moment been victorious as well as that which had momentarily been defeated. The death-knell of the Republic had rung as soon as the active power became lodged in the hands of those who sought, not to do justice to all citizens, rich and poor alike, but to stand for one special class and for its interests as opposed to the interests of others.

For in no way is the stability of property better assured than by making it patent to our people that property bears its proper share of the burdens of the State; that property is handled not only in the interest of the owner, but in the interest of the whole community.

A heavy progressive tax upon a very large fortune is in no way such a tax upon thrift or industry as a like would be on a small fortune. No advantage comes either to the country as a whole or to the individuals inheriting the money by permitting the transmission in their entirety of the enormous fortunes which would be affected by such a tax; and as an incident to its function of revenue raising, such a tax would help to preserve a measurable equality of opportunity for the people of the generations growing to manhood.

It is a bad thing for a nation to raise and to admire a false standard of success; and there can be no falser standard than that set by the deification of material well-being in and for itself.

In every civilized society property rights must be carefully safeguarded; ordinarily, and in the great majority of cases, human rights and property rights are fundamentally and in the long run identical; but when it clearly appears that there is a real conflict between them, human rights must have the upper hand, for property belongs to man and not man to property.

This country will not be a permanently good place for any of us to live in unless we make it a reasonably good place for all of us to live in.

Now, this means that our government, National and State, must be freed from the sinister influence or control of special interests. Exactly as the special interests of cotton and slavery threatened our political integrity before the Civil War, so now the great special business interests too often control and corrupt the men and methods of government for their own profit. We must drive the special interests out of politics.

Corporate expenditures for political purposes, and especially such expenditures by public-service corporations, have supplied one of the principal sources of corruption in our political affairs.

The absence of effective State, and, especially, national, restraint upon unfair money-getting has tended to create a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power. The prime need to is to change the conditions which enable these men to accumulate power which it is not for the general welfare that they should hold or exercise.

We grudge no man a fortune in civil life if it is honorably obtained and well used. It is not even enough that it should have been gained without doing damage to the community. We should permit it to be gained only so long as the gaining represents benefit to the community.

No man should receive a dollar unless that dollar has been fairly earned. Every dollar received should represent a dollar’s worth of service rendered — not gambling in stocks, but service rendered. The really big fortune, the swollen fortune, by the mere fact of its size acquires qualities which differentiate it in kind as well as in degree from what is possessed by men of relatively small means. Therefore, I believe in a graduated income tax on big fortunes, and in another tax which is far more easily collected and far more effective — a graduated inheritance tax on big fortunes, properly safeguarded against evasion and increasing rapidly in amount with the size of the estate.
.
.
.
Different times, maybe, but certainly a different brand of Republican than we see today.

24 . May 25, 2014 at 7:59 PM

If the bill ONLY addressed shedding employee costs via contract employees it would be a bill that would gain bipartisan support.

25 anonymous May 25, 2014 at 8:01 PM

Never met a tax DeSaulnier didnt like

26 oh belvedere May 25, 2014 at 8:27 PM

@23 Cal Old Blue… that makes perfect sense in the context of DeSaulnier’s bill. As anyone who has followed DeSaulnier’s career knows, he is a TR afficianado and named his restaurant after the man.

A curious thing about right-wingers is that their heroes have a short shelf life. Nobody invokes Reagan much these days, either. He has grown oddly liberal as of late.

27 Anon May 25, 2014 at 8:39 PM

What a moron!

28 Anonymous May 25, 2014 at 9:47 PM

Right Mark, just keep driving business out of California. Way to appeal to the hard left.

Idiot

29 AldrigeFamily May 25, 2014 at 9:55 PM

Lol, all show, he knows it’s a hollow law, is he trying to prove to the DEM establishment that he is indeed one of them…and what clerk said “O yeah that’s a great idea?”. Betcha he didn’t pay his employess clse to what he made annually.

30 Anon May 25, 2014 at 10:15 PM

Ya Markie Mark what is your pay compared to the average state worker? I bet it is more than the bill allows, of course your bill has an exemption for state employees don’t it? Jack A$$

31 PO'd May 25, 2014 at 10:23 PM

Another tax grab by what appears to be Marxist philosophy behind it.Extreme arrogance by a “progressive”. Absolutely ridiculous!!
The progressive Democrats seem to be more interested in eliminating capitalism than any thing else..It’s done by manipulating one of the basic human emotions- envy. It’s the same argument the Bolsheviks used during the revolution( remember the useful idiots?).
That would probably be the end of California as we know it if it passes.
You must ask yourself one question: do you really want this guy in Congress??

32 The DeSaulnier solution May 25, 2014 at 11:11 PM

See a problem
Make a tax
All well now

33 Michelle May 25, 2014 at 11:19 PM

I see it as too many taxes. Homeowners already pay up the ying-yang, why more taxes?

34 Campaign song May 25, 2014 at 11:58 PM

Mark ,Mark
He’s our man
If he can’t raise taxes
Nobody can

35 Pat Pomeroy May 26, 2014 at 5:58 AM

Don’t big name multi-millionaire Hollywood actors and actresses make substantially more income and perks than the average movie-goer?

Don’t big name multi-millionaire athletes make substantially more income and perks than the average sports spectator.

Talk about income inequality.

Will a bill be forthcoming to limit how much they make compared to how much other employees make?

36 martinezdad May 26, 2014 at 7:02 AM

I’m happy to see common sense reigns in claycord

37 @ Pat Pomeroy May 26, 2014 at 8:09 AM

You are of course correct, but athletes are popular so DeSaulnier would never take them on. No guts

38 Anon May 26, 2014 at 10:50 AM

Looks like Markie Mark needs to ban anyone with more than 10 points of IQ. You know, large capacity IQs. LOL

39 ..... May 26, 2014 at 11:14 AM

He’s just parroting the George Miller line…..

40 Anonymous May 26, 2014 at 2:51 PM

Mark at his best. Raising taxes and driving business out of the state ,again.

41 Aunt Bee May 26, 2014 at 3:22 PM

LOOSER and ANTI American guy.

42 Just me May 26, 2014 at 4:25 PM

We moved out of CA. Nice to have better people to represent us then George, Mark and Nancy P.

43 anonymous May 26, 2014 at 5:02 PM

Anyone who values the free market system and liberty ought to be very wary of DeSaulnier.
Loves to tamper and raise taxes.

44 RANDOM TASK May 26, 2014 at 5:16 PM

now FIRST show me the who is IMMUNE list and then we can start talking about how this will all be run by whom …oh yeah that’s right de-scammers lackeys who are under direct control by whom ….lets see ..its right here ….oh yeah he himself ……another dem lazy bill passed by dimwit voters who can hardly read or write English …….any questions

45 Anonymous May 26, 2014 at 7:19 PM

This is called shoring up his left flank. Thought they would be satisfied when he voted to let boys into girls bathrooms.

He it’s ungood

46 Anonymous May 26, 2014 at 9:27 PM

Silly man

47 Always Right May 27, 2014 at 8:48 AM

So far the comments on this proposal are 90% negative.

Glad to see most Claycordians get it. Trying to cut CEO pay will drive more businesses out of California and assure high unemployment and more “inequality”.

This is just Desauliner trying to build creds with the union bosses and far left that are funding his campaign.

48 Anonymous May 27, 2014 at 9:40 AM

There is a mailing going out to California corporations from Rick Perry ,Governor of Texas ,citing this proposed legislation with an invitation to visit Texas.

If you work for a California corporation be prepared for a move..

49 ..... May 27, 2014 at 11:24 AM

“…an effort to incentivize ‘ “fair pay’.”

“…sensible differences between CEO and worker pay…”

“Brandeis warned that we may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

“SB 1372 begins to address the growing concentration of wealth at the very top. Out of control income inequality is a direct threat to American democracy.”

“As former Labor Secretary Robert Reich has pointed out – the growing divergence between CEO pay and that of the average worker isn’t just unfair, it is bad for the economy.”

Now these idiot politicians are telling us what’s “fair” or what’s “sensible”. And they’re also telling us that it’s a “threat to American democracy” and it’s “unfair”.

These politicians know NOTHING about corporations and responsibilities to shareholders, since neither of them (and probably none of the others voting for it) had ever worked for a corporation. They can quote two individuals about why a large disparity is bad – but I’ll bet I can come up with plenty of reasons why it’s NOT bad.

Hey – Silicon Valley…. it’s time to relocate to Texas!

50 Anonymous May 27, 2014 at 2:34 PM

Good old Marxist DeSaulnier. Always can be counted on to raise taxes.

Punish those rich people !

51 Aspirin May 27, 2014 at 10:42 PM

Republicans like to support higher CEO pay because the money kicks back to the GOP campaign coffers. Our rotten political system is so rife with corruption it is beyond repair but Americans are not smart enough to realize it. Our elections are a sham because votes are bought, not deserved. People are lied to every day by politicians and the media but they are mindless to facts and common sense. The dumbing down of America suits the GOP just fine. It is the ONLY way it can get votes.

52 Aspirin May 27, 2014 at 10:45 PM

Too many posts here are from brainwashed conservatives who cannot think for themselves. We are in very deep trouble because of these people.

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