[Boston-editorial] Press release-New Tax Report on Social Security and Wall Street CEO Pay

[Christina Kasica]

Press Release - April 13, 2005
Contact:  For United for a Fair Economy: Christina Kasica
(617) 423-2148 x119; cell phone 617-966-0554
For Institute for America's Future: Toby Chaudhuri, (202) 955-5665 x133

KEY WALL STREET CEOS PAY SOCIAL SECURITY TAXES ONE DAY A YEAR
BUT PUSH FOR RISKY CHANGE

THOSE BACKING PRIVATIZATION EFFORT HAVE LITTLE STAKE IN RETIREMENT SYSTEM

BOSTON- A new report, entitled "Taxpayers for a Day:  The Most to Gain, the
Least to Lose" from United for a Fair Economy (UFE) and the Institute for
America's Future (IAF), finds that CEOs of Wall Street firms supporting the
partial privatization of Social Security effectively pay into the system for
only a few days a year. That is because Social Security tax payments are
capped and most financial industry CEOs have compensation packages high
enough to allow them to complete payments under the cap in the first few
days of January.

"The CEO of Charles Schwab, David Pottruck, finished paying his Social
Security taxes before the end of the Rose Bowl on January 1st, 2004," said
Scott Klinger, co-director of UFE's Responsible Wealth project and a
co-author of the report.  "That's $87,900 in a few hours.  Most Americans
pay all year long without ever reaching the annual cap."

The report examines the pay structures of 26 CEOs of finance industry
companies involved in backing privatization efforts and estimates the dates
by which they will have finished paying Social Security taxes.

* Of the 26 CEOs at public and U.S.-owned firms, average compensation in
2004 was $17,712,239.  The average CEO within this group surpassed the
$87,900 earnings cap after 4 days on the job, or at the end of the day on
January 4th, after which no Social Security tax would be collected.

* While 94 percent of workers effectively pay 12.4 percent of their annual
income, including employer's contribution, these CEOs pay an average
effective rate of 0.16 percent of their annual income toward Social Security
taxes.  The average "Joe" taxpayer pays an effective rate that is more than
201 times the effective rate of the average CEO in this group.

* Seven of the CEOs are "taxpayers for a day."  Their pay was so high, they
exceeded the 2004 $87,900 earnings cap in eight hours or less.  These
include the CEOs of Bear Stearns, Charles Schwab, Goldman Sachs, Lehman
Brothers, Morgan Stanley and Wells Fargo/Strong Financial.

"To these guys, $90,000 is play money," said report co-author Adam Luna, IAF
Policy Director.  "Trouble is, they want Congress to privatize Social
Security so they can play with our money."

"As most Americans worry about their ability to pay their taxes by April 15,
they should keep in mind that Social Security would be funded and solvent
into the next century if the highest-earning 6% of Americans would pay taxes
on their full income, just like everyone else," concluded Klinger.

Authors of the report at United for a Fair Economy and the Institute for
America's Future are available to comment on the report, which can be found
at http://www.faireconomy.org/WallStreetCEOs.

United for a Fair Economy is an independent national non-profit that raises
awareness that concentrated wealth and power undermine the economy, corrupt
democracy, deepen the racial divide, and tear communities apart.

The Institute for America's Future (IAF) is a center of progressive
strategy, organizing and issue campaigns.  IAF anchors a progressive
leadership network, enlisting leaders at the national, state and local
levels to build a more just and democratic society.

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