Good news: The Minnesota Supreme Court ruled last week that Minneapolis could go foward with its minimum wage increase, set to reach $15 for some businesses starting in 2023.
That means a lot for a city beset with soaring rents and scarce housing, and where about 20 percent of residents live in poverty.
So, that's the 20 percent. How about the 1 percent?
The Minnesota Reformer did the tedious and depressing work of sorting through Minnesota’s Fortune 500 companies and figuring out how much CEOs made last year compared to their average workers. Guess what? They make a lot more.
Based on 2019 financial statements provided to the SEC, Target’s at the top of the Reformer's list, with a 767:1 ratio. CEO Brian C. Cornell made a little over $17 million, and the median Target worker didn’t quite reach $22,500. Next in line was Best Buy with 605:1.
As these two companies told Minnesota Reformer, that’s due in part to the fact that a lot of people who work for Target and Best Buy work part-time.
The same can't be said for UnitedHealth Group and 3M, which both had ratios in the 300:1 range.
It doesn't get much better. The lowest disparity goes to CHS, the massive grain co-op conglomerate (with mostly white guys in charge), which comes in at 110:1. CHS CEO Jay Debertin made $8.3 million, and the median worker made just under $76,000.
SEC statements were not available for two of Minnesota's Fortune 500 companies: Land O’Lakes and Thrivent Financial for Lutherans. On top of that, companies may use “different methodologies” to calculate compensation—i.e., some count overtime, and some don’t.
Nationally, the average executive of an S&P 500 company makes about 278 times more than one of their workers. The gap is expanding. The average CEO also got a $500,000 bump in pay over the previous year, as opposed to barely more than $1,000 for the average worker.
The data's available thanks to the Dodd-Frank Act of 2010, a law that remains unpopular with corporate America. (In 2018, Donald Trump signed a partial repeal into law.)
Minnesota CEOs aren’t the worst offenders by a long shot. Estee Lauder’s pay ratio is 1,690:1. McDonald’s is 2,123:1. One of the biggest gaps is, literally, the Gap—3,566:1.
To understand the sheer madness that is wealth distribution in this country, you’ve got to try to understand one number: $137 billion. That, depending on the day, is the estimated net worth of Amazon CEO Jeff Bezos.
The human mind sort of short-circuits when it encounters numbers in the billions. We get that it’s a lot, but we often can’t fathom the scale, the scope, of being a billionaire, beyond the ability to purchase boats, or sailing hats, or islands. Whatever it is rich people like.
Here’s a broader perspective. As of 2016, there were only 540 billionaires in the United States, with a combined net worth of $2.399 trillion, according to Forbes. (Three of those guys—Bezos, Warren Buffett, and Bill Gates—have as much as half the country does.)
In order to become as wealthy as Jeff Bezos, Cornell, the CEO of Target, would have to earn his roughly $17 million CEO pay for 8,000 years. With the amount Bezos reportedly makes in a second ($2,500), you could buy this rococo-lookin’ Chateau de Ville cherry wood dining table from Target’s website. Or, you know, pay the average rent for a three-bedroom apartment in Minneapolis.
On a smaller scale, if Ameriprise CEO James Caracchiolo, the highest-paid CEO on the Reformer's list, wanted to match Glen Taylor's $2.9 billion, he'd need to earn his $25.7 million salary for about 113 years. And not spend any of it.
Feel free to celebrate Minnesota's victory in the battle for minimum wage. Then consider whether it's time to start talking about a maximum one.