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	A Goldern Age for Corporate Profits by Reuters, Public Citizen & agencies   March 2013   Swiss overwhelmingly Vote to Curb Executive Pay.   Swiss citizens have voted overwhelmingly to rein in exorbitant executive pay. With the backing of nearly 68% of voters, Agence France-Presse reports that the so-called "fat cat initiative" would limit the mandate of board members to one year, and would ban certain kinds of compensation, including the so-called golden handshakes or golden parachutes given to executives when they leave a company.   In addition, it would ban the bonuses received for takeovers, or when a company sells off part of its business.   The BBC adds that it would give shareholders a veto on compensation and ban big payouts for new and departing managers.   “Today’s vote is the result of widespread unease among the population at the exorbitant remuneration of certain company bosses,” Justice Minister Simonetta Sommaruga told reporters in Bern after the vote.   The country"s direct democracy system allowed for the vote to take place, Reuters points out:   While anger at multi-million dollar payouts for executives has spread around the globe since the financial crisis, Swiss direct democracy - including four national referendums a year - means public outrage can be translated into strong action.   Days before the Swiss vote, the EU parliament approved a plan to cap bonuses for financial executives and bankers.   March 4, 2013   "Golden Age for Corporate Profits". (USA)   As across-the-board federal budget cuts go into effect and the "real pain" predicted by economists and policy experts begins to creep into the lives of everyday people—namely US workers—investors on Wall Street are saying: "bring it on."   Quoted in a New York Times article on Monday that describes the current economy as a "golden age for corporate profit," Savita Subramanian, who heads the equity and quantitative strategy for Bank of America Merrill Lynch, said that despite the terrible times for working people and warnings that nearly three-quarters of a million jobs could be lost this year in the US, "the market wants more austerity."   As the Times points out, most of the profit gains made by multinational corporations since the 2008 crash have come because of increased productivity and government-backed lending that only larger firms can leverage. Neither of these gains, however—or the profits derived from them—are being shared with workers or lower-income, struggling Americans.   According to the Times:   As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966.   Travis Waldron at ThinkProgress points out:   From 2009 to 2011, 88 percent of national income growth went to corporate profits while just one percent went to workers’ wages, and hourly earnings for workers actually fell over that time. And while they aren’t investing in job growth, corporations are also paying taxes at a rate that hit a 40-year low in 2011.   Richard Eskow at the Campaign for America"s Future, believes change begins with acknowledging the clear disparities and ends with actually introducing policies beneficial to working people. The real “job creators” aren’t the ultra-wealthy. If they could create jobs with all their added wealth, they would have done it already. The real job creators are working people with jobs.   They don’t invest their money in hedge funds or stash it in offshore accounts. They spend it: on food, transportation, their kids education, maybe a night at the movies … And then other people get jobs making those things possible.   Paul Krugman says, “To the extent that people say the economics is confusing or uncertain, that’s overwhelmingly because people want it to be.” We know how to do this.   Raising the minimum wage is a start. A maximum wage would help, too, by reducing CEOs’ incentives to emphasize quarterly gains over long-term growth and leaving more to be shared with employees.   We also need a national strategy for regaining the more reasonable distribution of income this country had in the 1950s. We need to ensure that the door of opportunity, which is closing every day for millions of young people, is opened again. And we need to ask the wealthiest to really pay their fair share – at something closer to the top tax rates of the 1950’s or 1960’s.   Most of all, we need to educate those around us so they understand what’s happening. That includes the well-intentioned well-to-do, who might do more to end the problem if they knew it existed. After all, you can’t stop a robbery until you know it’s happening.   If Switzerland can crack down on CEOs, Why not the US, by John Nichols. (The Nation)   Does anyone seriously doubt that, if America had the same national referendum system that Switzerland does, voters in the United States would vote just as aggressively as the Swiss have to curb CEO abuses?   Actually, the 68 percent support for Sunday’s Swiss referendum that gives shareholders broad new powers to curb excessive pay for bankers and corporate executives might well be shy of the mark that the US could hit.   Polls of American voters have regularly shown that over 70 percent favor restrictions on executive compensation, with even self-identified conservatives registering majority support for clamping down on CEOs.   And rightly so. It is not jealousy that motivates concerns about CEO pay. As the AFL-CIO’s Executive Paywatch campaign notes, when CEO pay rises so too does income inequality. In 2010, as the United States emerged from the depths of the Bush recession, a study by University of California economist Emmanuel Saez found that the top 1 percent of Americans captured 93 percent of the growth in income.   Worse yet, CEOs use their money to game the system so that they get richer while the great mass of Americans are squeezed. More than 120 CEOs are currently supporting billionaire Pete Peterson’s “Fix the Debt” campaign, which is chaired by Erskine Bowles and Alan Simpson. A deficit-reduction plan proposed by Bowles and Simpson last month would slash cost-of-living increases for Social Security recipients while at the same time reducing the top marginal tax rate for corporations and the wealthy.   In Switzerland, anger at “golden handshake” and “golden parachute” deals for executives who ran corporations poorly and seemed to be more concerned for their own good than for the long-term economic prosperity of their country, led by small businessman and parliamentarian Thomas Minder to mount a populist campaign to increase the authority of shareholders to regulate errant CEOs.   As in the United States, that’s the sort of proposal that gets a lot of talk but that was not likely to go far in the corridors of political power in Switzerland. Luckily, Switzerland has a long history of allowing citizens to initiate and implement legislative changes.   Under Swiss law, any issue can be put to a national referendum if supporters of a vote attain 100,000 petition signatures seeking the test. In recent years, the Swiss have voted on people’s initiatives to guarantee “six weeks of vacation for everyone,” to put an “end to the limitless construction of second homes” that crowd Alpine villages, to expand the ability of tax-supported building society savings to finance energy saving and environmental measures, and to require money gained from maintaining casinos be used for the public interest.   Minder, who has been campaigning for years to address excessive pay for executives he refers to as “losers of the century” and “studs in pinstripes,” was elected to the Swiss Senate as an independent (who has since sided with conservatives on some issues and the Greens on others) in 2011. He agitated on the inside of government for moves to empower shareholders, but quickly turned to the referendum route. Condemned as a “loner” and criticized for being uncompromising, Minder went up against the political and economic establishment in Switzerland, a country that has long been a haven for multinational corporations and banks.   His “Minder Initiative” drew aggressive opposition from prominent business and political leaders. But it made sense to voters, especially as Minder explained: “I never said that my goal was the reduction of salaries. I just want shareholders to take responsibility for the levels of remuneration. If the shareholders want to waste company money by paying exorbitant amounts, that’s their problem.”   At the very least, the sweeping victory for reform in Switzerland has sent a signal. One of the leading newspapers in the banking center of Zurich, Tages-Anzeiger, observed Monday morning that the decision was “a vote in favour of decency and fair salaries.” The vote “does not above all express envy,” the newspaper’s editorial continued, “but a feeling that company managers have been ransacking the coffers at the expenses of society.”   The Minder Initiative serves as an important model for US discussions about increasing shareholder rights. And that discussion can and should go well beyond the question of CEO pay.   In 2010, the US Supreme Court’s Citizens United ruling removed barriers to unlimited corporate spending on US political campaigns. At the same time, highly compensated CEOs are among the biggest direct donors not just to individual campaigns but to so-called “Super PACs” that flood the airwaves with negative advertising.   The Citizens United ruling will ultimately need to be addressed either by a reversal of the court’s decision or by a constitutional amendment. But of the immediate fixes that have been proposed, one of the best is the suggestion that shareholders be given the right to vote on corporate political expenditures. Britain has such a law. But the United States does not.   As a result, notes the Brennan Center, the “Citizens United decision opened a loophole in which one group of Americans—shareholders in publicly traded companies—must routinely support political goals that they may reject. Under Citizens United, corporations can spend directly from their treasuries to influence elections. When shareholders’ invested money is spent on politics, millions of Americans are stuck unknowingly contributing to political causes they may not themselves support.”   In 2011, Congressman Michael Capuano (D-MA) introduced an American Shareholder Protection Act to empower shareholders to vote on whether to allow CEOs and corporate boards to spend company money on political campaigns.   “Shareholders—not the CEO and not the board of directors—are the real owners of any publicly traded corporation, and the decision should be theirs,” argued Public Citizen in campaigning for the measure, which attracted forty-nine co-sponsors.   Public Citizen has also led the campaign to get the Obama administration to crackdown on federal contractors that use corporate money—from accounts padded with taxpayer dollars—to fund campaigns. Which raises an interesting question: Could the president issue an executive order giving shareholders of companies that contract with the government the authority to decide whether those firms should play politics with corporate money?   The Swiss vote for the Minder Initiative is drawing a lot of attention in the United States.   That’s good. Hopefully, it will lead to greater pressure for reducing excessive CEO pay. But it is essential to recognize that simply regulating CEOs is not enough.   Shareholders should be empowered in the US, as they have been in Switzerland. “The shareholders are the owners of the company,” explains Julie Goodridge, CEO of NorthStar Asset Management of Boston, a socially active investment firm. “They need to be voting on these kinds of contributions.”   As Public Citizen notes, “Anyone with a 401(k) invested in stocks or mutual funds—nearly half of all households today—has a stake in how the corporate money in those funds is spent. Passage of a Shareholder Protection Act would help the public hold corporations accountable for their political behavior.” Visit the related web page
	Why food riots may become the new normal by Nafeez Mosaddeq Ahmed   Mar 2013   The link between intensifying inequality, debt, climate change, fossil fuel dependency and the global food crisis is undeniable, writes Nafeez Mosaddeq Ahmed for The Guardian.   Just over two years since Egypt"s President Hosni Mubarak resigned, little has changed. Cairo"s infamous Tahrir Square has remained a continual site of clashes between demonstrators and security forces, despite a newly elected president. It"s the same story in Tunisia, and Libya where protests and civil unrest have persisted under now ostensibly democratic governments.   The problem is that the political changes brought about by the Arab spring were largely cosmetic. Scratch beneath the surface, and one finds the same deadly combination of environmental, energy and economic crises.   We now know that the fundamental triggers for the Arab spring were unprecedented food price rises. The first sign things were unravelling hit in 2008, when a global rice shortage coincided with dramatic increases in staple food prices, triggering food riots across the middle east, north Africa and south Asia. A month before the fall of the Egyptian and Tunisian regimes, the UN"s Food and Agriculture Organisation (FAO) reported record high food prices for dairy, meat, sugar and cereals.   Since 2008, global food prices have been consistently higher than in preceding decades, despite wild fluctuations. This year, even with prices stabilising, the food price index remains at 210 – which some experts believe is the threshold beyond which civil unrest becomes probable. The FAO warns that 2013 could see prices increase later owing to tight grain stocks from last year"s adverse crop weather.   Whether or not those prices materialise this year, food price volatility is only a symptom of deeper systemic problems – namely, that the global industrial food system is increasingly unsustainable. Last year, the world produced 2,241m tonnes of grain, down 75m tonnes or 3% from the 2011 record harvest.   The key issue, of course, is climate change. Droughts exacerbated by global warming in key food-basket regions have already led to a 10-20% drop in rice yields over the past decade. Last year, four-fifths of the US experienced a heatwave, there were prolonged droughts in Russia and Africa, a lighter monsoon in India and floods in Pakistan – extreme weather events that were likely linked to climate change afflicting the world"s major food basket regions.   The US Department of Agriculture predicts a 3-4% food price rise this year – a warning that is seconded in the UK. Make no mistake: on a business-as-usual scenario, this is the new normal. Overall, global grain consumption has exceeded production in eight of the past 13 years. By mid-century, world crop yields could fall as much as 20-40% because of climate change alone.   But climate is not the only problem. Industrial farming methods are breaching the biophysical limits of the soil. World agricultural land productivity between 1990 and 2007 was 1.2% a year, nearly half compared with 1950-90 levels of 2.1%.   2008 also saw a shift to a new era of volatile, but consistently higher, oil prices. Regardless of where one stands on the prospects for unconventional oil and gas for ameliorating "peak oil", the truth is that we will never return to the heyday of cheap petroleum.   High oil prices will continue to debilitate the global economy, particularly in Europe – but they will also continue to feed into the oil-dependent industrial food system. Currently, every major point in industrial food production is heavily dependent on fossil fuels. To make matters worse, predatory speculation on food and other commodities by banks drives prices higher, increasing profits at the expense of millions of the world"s poor.   In the context of economies wracked by debt, this creates a perfect storm of problems which will guarantee high prices – eventually triggering civil unrest – for the foreseeable future.   It"s only a matter of time before this fatal cocktail of climate, energy and economic challenges hits the Gulf kingdoms – where Saudi Arabia is struggling with an average total oil depletion rate of about 29%. If oil revenues reduce in coming years, this would lower subsidies for food and fuel. We"ve already seen how this can play out, for instance, in Egypt, whose domestic oil production peaked back in 1996, reducing government spending on services amid mounting debt.   The link between intensifying inequality, debt, climate change, fossil fuel dependency and the global food crisis is now undeniable. As population and industrial growth continue, the food crisis will only get worse. If we don"t do something about it, according to an astounding new Royal Society paper, we may face the prospect of civilisational collapse within this century. The Arab spring is merely a taste of things to come.   * Access the report "Can a collapse of global civilization be avoided", by Paul and Anne Ehrlich via the link below. Visit the related web page
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