KasichEconTheory

So, apparently, the Cleveland Plain Dealer has a running feature in its business section in which they review the latest SEC filings of major corporations and report on changes of major local corporate leaders pay.

Yesterday, the Plain Dealer did one on American Greetings’s shareholder proxy statement filing with the SEC and found this out about its CEO’s pay.

Chief Executive Officer Zev Weiss $3,881,709.00

Change from previous year: +18.7

Zev Weiss, 44, received a 2.5 percent increase in his base salary to $944,495; stock awards of $368,769; option awards of $630,278; non-equity incentive plan compensation of $1,716,715; change in pension value and nonqualified deferred compensation earnings of $125,212; and $96,240 in other compensation.

This last category includes: $7,833 in tax reimbursements for company-paid life insurance; $14,458 in 401(k) matching and profit-sharing contributions; $42,118 in company-paid benefits to an executive deferred compensation plan; $10,706 in universal life insurance premiums; and $21,126 for a company car, free greeting cards and company other products, and accidental death and dismembership insurance worth $275,000.

ThanksAmericanGreetings This is a company that got potentially $93.5 million over 15 years in State taxpayer assistance to “stay in Ohio” when it had pretty much already committed to do so before Kasich took office.  A company that Governor Kasich says a City of Brooklyn .5% payroll tax increase (a tax that is passed on to its employees) was going to force the company to move to Illinois to stay competitive despite its $883 million in profits last year.

Seriously, I’m all for corporations making profits and rewarding risk takers, but with $93.5 million in State taxpayer assistance, isn’t American Greetings taking less risk than a company that can’t rely on a State subsidy for the status quo?

I just left a message with American Greetings’ Media Relations Office asking them what their non-executive employees, on average, should expect to see as a raise as a result.  I’ll update this post if (and when) we get a statement from them.

But the point remains, it’s hard not to see that not only are Ohio taxpayers subsidizing a corporation that is incredibly profitable on it own, but now taxpayers are subsidizing the raises being given to its top executives.

In his desperation to avoid the ghost of NCR early in his Administration, John Kasich rushed to write a nearly $100 million check to a business that really didn’t need the money because it was doing just fine on its own without government intervention.  Is it a wise use of limited State resources, at a time in which the State is slashing BILLIONS in public education funding, to make a nearly $100 million commitment to a private company who then turns around and gives its top executive a nearly 20% raise?

Seriously, doesn’t a 19% raise seem just a tad excessive to give while the company is receiving millions in tax incentives?

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