They Slashed Their Own Pay, Too, Didn’t They? NOT!!!

Jun 21, 2012
Essential Research

You know how it goes–a company is in financial trouble, it slashes jobs to save money and, of course, the CEOs take a hit along with the regular workers. Slap, slap, slap–wake up! You’re not in Alice-in-Wonderland world. You’re in the real world, the wondrous “free market” where CEO salaries never go down, no matter how bad they screw up. Which brings us to the saga of the Sydney Morning Herald and The Australian.

The Herald’s management announced it was going to sack–we prefer not using the Orwellian word “redundant”, since it has a way of making the whole thing sound so neutral and mild–1,900 people, for an alleged savings, along with other measures (principally, making people pay for access to the website) of $235 million by 2015. But, not a problem for chief executive Greg Hywood, who is not taking a financial hit and is doing quite well, thank you very much:

Mr McCarthy’s replacement, Greg Hywood, got $1.5 million for his six months in the job last financial year, while he is now eligible for a bonus of 150 per cent of his $1.6 million base salary.

Not to mention the deep pockets of one mining billionaire named Gina who is determined, we think, to wake up one shining day to be greeted with the banner headline “Sydney Mining Herald.”

Not to be outdone in the shameless category, The Australian is going to slash 70 percent of its divisions–but somehow the Rupe found $2 billion to double his takes in Foxtel. But, have we heard of any cuts at all in Rupe’s pay ($33 million USD in 2011) or any of his other top underlings. We find out a little more of the life the Rupe leads, while he’s cutting the pay of others, from this wet-kiss profile of Wendi Deng (Murdoch) in The New York Times:

She used to wash her clothes and face with the same soap, said a 2008 Vogue article, and seldom wore makeup, much less luxuriated in the perks of privilege — like the private yoga classes with her friends Kathy Freston and Arianna Huffington — she indulges in today. At Yale, she would stake out Filene’s Basement to procure designer gowns on the cheap. Today, she is regularly photographed wearing Rodarte and Prada.

Mrs. Murdoch quickly and giddily embraced the trappings of great wealth. While her husband conducted business in various European capitals, she would travel with him and shop for glassware and cutlery and curtains to stock her new homes. In addition to their loft in SoHo, the Murdochs transformed an old hutong in Beijing into a courtyard oasis decorated with art by Chinese artists.

So, there it is: cuts are paid because of “changing conditions” or “new markets” or “new realities” but the story remains the same. The rich rob the workers who create the wealth–and, when things get rocky, the only people taking it in the chin are the very people who had nothing to do with creating the mess.

–Jonathan Tasini

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