Multi-Millionaire CEOs Try to Cut Social Security While Compiling Massive Nest Eggs of Their Own

The loudest calls for cutting, and ultimately, gutting Social Security are coming from two lobby groups led by CEOs who will never have to worry about their own retirement security. The retirement accounts of these Business Roundtable CEOs average $14.5 million, more than 1,200 times larger than typical U.S. workers.

by Bill Berkowitz

The opening line of a new report by the Institute for Policy Studies and the Center for Effective Government might be considered controversial if it wasn’t so gob-smackingly true: In the current budget debate, the loudest calls for Social Security cuts are coming from two lobby groups led by CEOs who will never have to worry about their own retirement security.

The report, titled Platinum-Plated Pensions: The Retirement Fortunes of CEOs Who Want to Cut Your Social Security, points out that two organizations, Fix the Debt, a PR and lobby machine launched in 2012 and led by more than 135 CEOs of major corporations, and the Business Roundtable, a 40-year-old association made up of about 200 CEOs of Americas largest corporations, are involved in a protracted campaign aimed at cutting, and ultimately, gutting Social Security.

Platinum-Plated Pensions, written by Sarah Anderson, the Director of the Global Economy Project at the Institute for Policy Studies, and Scott Klinger, Director of Revenue and Spending Policies at the Center for Effective Government, found that the CEOs belonging to Fix the Debt and Business Roundtable are sitting on massive nest eggs of their own.

The report focuses on the retirement funds of Business Roundtable members, but there is considerable overlap in BR and Fix the Debt. More than half of the Business Roundtable executive committee members and a quarter of their total members are affiliated with Fix the Debt.

Key findings from Platinum-Plated Pensions include:

1. Retirement assets of Business Roundtable CEOs are 1,200 times larger than typical U.S. workers.

These CEOs retirement accounts average $14.5 million, more than 1,200 times as much as the $12,000 median retirement savings of U.S. workers near retirement age. A retirement fund of $14.5 million, combined with Social Security, would generate a monthly retirement check for these CEOs of $88,576. That’s 68 times what a typical U.S. retiree can expect.

2. Three CEOs pushing Social Security cuts have $100 million-plus retirement funds.

Of the 168 Business Roundtable CEOs who lead U.S.-based publicly held corporations, 10 (including four who are also members of Fix the Debt) have corporate retirement plans valued at more than $50 million. At the very top are three CEOs who have retirement assets of more than $100 million: John Hammergren, CEO of McKesson, has the largest retirement fortune, having amassed $144.3 million in his retirement nest egg. Honeywell’s David Cote, a leading spokesperson for both the Roundtable and Fix the Debt, has a $134.5 million retirement pot of gold after just 11 years at the helm. Mike Duke, CEO of Wal-Mart Stores, is sitting on $113.2 million in retirement assets, compared to his employees’ average 401(k) account balance of $15,000.

3. While gilding their personal pensions, many Roundtable CEOs have allowed massive deficits to grow in their employee retirement funds.

Of the Business Roundtable CEOs whose firms provide pension funds for their workers, 10 have deficits in these funds of between $4.9 billion and $22.6 billion. The Roundtable CEO with the largest deficit in his company’s worker pension fund is Jeffrey Immelt of General Electric, with $22.6 billion. Immelt’s personal retirement fund is worth more than $59 million, the sixth-largest among Roundtable CEOs.

Fix the Debt — a hypocritical corporate PR campaign

Launched in 2012, Fix the Debt aimed to lead a high-profile communications and lobbying campaign for deficit reduction, complete with a youth outreach arm that has organized a multi-city college campus bus tour, state chapters led by prominent business and political leaders of both parties, aggressive advertising, and intense social media efforts, according to the report.

Honeywell’s David Cote has said that he “brought together about 100 other CEOs to participate in it with me as we funded to the tune of $45 million this effort.”

“Bread Line.” A bread line for the hungry and destitute will be the only form of Social Security left if “Fix the Debt” has its way. Wood engraving by Clare Leighton

Pete Peterson, who put up $5 million of the campaign’s initial funding, is a longtime political operative and one of the wealthiest men in the country who made his personal fortune at the Blackstone Group on Wall Street. According to the Center for Media and Democracy (CMD), Peterson cashed out with $2 billion shortly before the 2008 financial meltdown.

The Los Angeles Times has called Peterson “the most influential billionaire business figure in national politics. . . . He isn’t content merely to express concern about the federal deficit. His particular targets are Social Security, Medicare and Medicaid, which he calls ‘entitlement’ programs and which he wants to cut back in a manner that would strike deeply at the middle class.”

CMD, an invaluable watchdog group that over the years has become expert at ferreting out truth from fiction — particularly as it relates to corporate-developed public relations campaigns, and industry-sponsored Astroturf groups — labeled Fix the Debt as one of the most hypocritical corporate PR campaigns in decades.

Several Business Roundtable CEOs seem to be trying the old carnival worker trick of distracting a contestant in a memory game with a shiny object in the corner, trying to distract attention away from the large deficits many of them have accumulated in their employees pension funds.

Platinum-Plated Pensions offers three Fair Retirement Security Reforms:

1. Eliminate the cap on wages subject to Social Security taxes.

2. End the ability of CEOs and high-income executives to defer unlimited amounts of pay in their retirement plans.

3. Support universal, secure and adaptable (USA) retirement funds.

Although public opinion is soundly against any cuts to Social Security, Fix the Debt and Business Roundtables millionaires, sitting in the catbird seat, will no doubt soldier on in their efforts to gut one of America’s most successful programs.

Bill Berkowitz’s WorkingForChange column Conservative Watch documents the strategies, players, institutions, victories and defeats of the American Right.

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