“Tax the Rich” Efforts in California and Nationally

"This campaign to defeat [Proposition D in San Francisco] has been backed by six, count them, six billionaires, and a whole bunch of companies with really big gaps between their CEO and their worker pay." - Sarah Anderson, Inequality.org. Unlock this and all other interviews by upgrading your subscription NOW.

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FEATURING SARAH ANDERSON - Californians on Tuesday headed to the polls for a major primary race that not only decided on nominees for the governor’s race in November, but also voted for local ballot measures that raise taxes to pay for social services in an economy that is squeezing ordinary people. San Francisco, home to many billionaires and corporate executives, is considering a tax on companies with egregiously overpaid CEOs, called Proposition D (as of this publication, the measure is too close to call). And, unions are hoping to place a billionaire tax on the November ballot to fund essential services like healthcare. 

Sarah Anderson directs the Global Economy Project and co-edits the Inequality.org website and weekly newsletter at the Institute for Policy Studies. She is a leading expert on CEO pay, having produced an annual Executive Excess report for more than 20 years. She spoke with Sonali Kolhatkar about San Francisco's Proposition D and other efforts nationally to target overpaid CEOs.

ROUGH TRANSCRIPT:

Sonali Kolhatkar: By the time a lot of folks hear this interview and watch it, the race in California will be over. Ballots will be getting counted. Some results will be known. But let's talk in general terms about this particular measure in California that I'm sure really is a big focus for you, considering that it directly impacts overpaid CEOs, your favorite topic. 

What is Proposition D and why is there a competing proposition that would lower tax on businesses in the works? How does it all work? 

Sarah Anderson: Yeah. So the way it works is the overpaid CEO tax raises taxes on companies, large corporations that are operating in San Francisco, and that pay their CEO more than 100 times as much as their median worker pay. And so essentially, it gives these corporations a choice. They can either narrow their pay gaps by lifting up worker pay or bringing down CEO pay to a reasonable level of less than 100 to one, and then they wouldn't owe an extra dime in taxes. 

But if they want to stick with those really extremely wide gaps, which a lot of research shows is not good for business because it undermines employee morale and productivity, but if they want to stick with those, then they're going to have to owe more taxes that will go towards vital public services in the city, which are really strained right now because of federal government cutbacks.