Wednesday, August 30, 2006

Defense Contractor CEOs' Pay Doubles

The study, conducted by the Institute for Policy Studies and United for a Fair Economy, found that, on average, CEOs of corporations with extensive defense contracts are getting paid about double what they made before Sept. 11, 2001. CEOs of other large corporations _ without big stakes in the war _ have averaged pay gains of 6 percent during the same period, the study said.


The study focused on the pay of the CEOs of the 34 publicly traded U.S. corporations that were among the top 100 defense contractors in 2005 and for which defense contracts made up more than 10 percent of revenues. The two groups calculated the CEOs' pay packages based on salary, bonuses, stock awards, long-term incentives and the value of stock options exercised in any given year. The information is publicly available from Securities and Exchange Commission filings.


Between 2001 and 2005, the profits for the 34 companies have climbed 189 percent. Profits for U.S. corporations as a whole rose 76 percent.


Another highly paid CEO is Jay Gellert, CEO of Health Net Inc., which provides managed health care to dependents of military personnel as well as Pentagon retirees. In the years immediately before Sept. 11, 2001, Gellert didn't break $1 million in compensation.

Gellert made $11.6 million last year after a big jump in military contracts that the company said in its SEC filings resulted from "a rise in demand for private sector services as a direct result of continued and heightened military activity."


No comments: