Audit Notes: $25,000 an Hour, Foreclosures, Corporate Taxes

The New York Times has done a lot of tough reporting over the years on outlandish executive compensation.

It’s time to send those reporters up the elevator.

Former CEO Janet Robinson got a $4.5 million contract to consult the company for a year when she was let go in December. It turns out that Robinson’s contract calls for no more than fifteen hours of consulting a month.

As Footnoted reports, that works out to about $25,000 an hour (at a minimum). This at a company that was on death’s door a couple of years ago and isn’t exactly minting money today.

Perhaps the big payment as she left was simply to thank her for her long service and ease the sting of the meeting in which (according to the Times itself) Arthur Sulzberger Jr. reportedly told Robinson that it was time to “[install] a different type of leadership at the company.” If that’s the case, though, perhaps they should just call it what it appears to be - a separation payment - rather than a consulting fee.

The Wall Street Journal has an interesting report showing that banks take quite a bit longer to foreclose on expensive houses:

A new analysis for The Wall Street Journal shows that high-end homeowners are able to remain in their houses, without making payments, for far longer than those with smaller mortgages.

Nationally, borrowers with loans of at least $1 million were in default for an average 792 days last year before banks repossessed their homes, according to an analysis by data provider Lender Processing Services. For loans under $250,000, the wait stood at an average 611 days—a difference of about six months.

The paper has some good reasons why this is so, including that more expensive homes are harder to sell, but it also notes this:

As recently as 2008, the foreclosure gap didn’t exist. Then, the average foreclosure took 260 days for loans under $250,000, and 251 days for loans of $1 million or more. As the housing crisis dragged on, the split grew.

— Peter Coy makes the case in Bloomberg BusinessWeek for not repealing the corporate income tax: It helps curb the accumulation of corporate power:

The corporate tax is imposed on corporate income, which adds to the economic resources of the corporation. These resources are managed by individual corporate managers, and their control over such resources gives them significant economic, social, and political power. In that sense, imposing a corporate tax reduces the economic resources and therefore also the power of corporate management. Whatever the economic incidence of the corporate tax, from this perspective its most immediate burden falls on corporate management, and not surprisingly they are the strongest supporters of corporate tax repeal…

My basic argument is therefore that the corporate tax is justified as a means to control the excessive accumulation of power in the hands of corporate management, which is inconsistent with a properly functioning liberal democratic polity.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum. Tags: , , , ,