Clippings: Hoard wealth, it’s the American way
Transocean Ltd., this company I love. It’s as all-American as apple pie. Doesn’t matter that its headquarters are in Switzerland; what do you think of when you think of Switzerland — Swiss banks. And what do you think of when you think of Swiss banks — obscene amounts of money locked away for the restricted use of an elite clique.
So, like I said — all-American.
What enchanted me so about Transocean? No, not the fact that it is one of the companies principally responsible for the biggest oil spill in the history of the United States — the Deepwater Horizon disaster a year ago, the one that pumped millions of gallons of oil into the Gulf of Mexico resulting in an ecological and economic catastrophe. It was Transocean’s acknowledgment this week that it was giving executives bonuses, in part because they achieved, according to their proxy statement, “the best year in safety performance in our company’s history.”
Now that took courage.
And not a little, teeny, tiny bit of courage. It took a lot of courage, an audacious amount of bravery for CEO Steven L. Newman to sign his name to that proxy statement. I’m sure he knew that whiners in the media and maybe a few of the family members of the nine Transocean employees killed on the Deepwater Horizon oil-drilling platform a year ago would complain about the bonuses for meeting safety targets going to the executives responsible for what President Obama called “the worst environmental disaster America has ever faced” (and he said that before the spewing oil well was even capped).
But what makes this company seem so American, is that it rewards courage. And a lot of courage gets a lot of reward. Take Steven L. Newman, for example. His salary for 2010 was $900,000. OK, fair enough, the salary was set before the tragic worst environmental disaster in the history of America. But it did take almost three months under his watch to get the spewing well capped. So what does the compensation committee of Transocean do? As of this past February it gave him a $200,000 raise in his annual salary. That brings his base salary to more than $1 million a year, plus he could get that much again as an annual bonus, plus he could get five times that as a long-term bonus. With stock awards and stock options, Steven L. Newman’s compensation of record in 2010 was actually $6,307,335.
An interesting footnote in the Transocean proxy states that Steven L. Newman’s “vacation travel allowance” in 2009 was $36,405. He got a slightly bigger vacation stash in 2010 — $42,406. At least he was still working for the company; curiously, in 2010 former CEO Robert L. Long received $19,992 in “an unused vacation payout.”
Also in 2010, Steven L. Newman received from Transocean a “cost of living adjustment” of $86,745 (I thought inflation was relatively flat last year), automobile allowance of $11,474 (last year my family bought on credit a five-and-a-half-year-old car with 95,000 miles for less than that), housing allowance of $160,638, schooling allowance of $83,466, and a payment toward his Swiss taxes of $193,763.
That effort to help Steven L. Newman pay his taxes is possibly the most American thing about Transocean. After all, if America is about anything, isn’t it about helping the rich pay less in taxes? Some of our most popular lawmakers know that. Just this week, Republicans in the U.S. House of Representatives showed an amount of chutzpah and political bravery that makes Steven L. Newman’s courage pale in comparison. They introduced a 2012 budget proposal that pays for cuts to federal programs that help the elderly and poor families pay for medical care by slashing the top income tax rate by almost one-third to 25 percent. It does the same for corporate rates.
So why does Steven L. Newman care that Congressional Republicans are trying to give wealthy Americans a big tax break? He’s the head of a Swiss company. Well, like me, he is a U.S. citizen (and happens to be the same age as me — 46). In fact, eight of the other 10 directors of Transocean are also U.S. citizens, that’s why they care. They’re Americans, they dream of making a ton of money, climbing up the ladder of success and pulling it up after them.
Any red-blooded American would want a piece of that pie.