Apr 15, 2006

Soaring Prices Help Fund $400 Million Exxon Payout

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Left: Exxon's Lee Raymond

(Irving, TX) After 13 years of running America's largest oil company, Lee Raymond is calling it quits.

To show the corporate gratitude for a job well done (the company posted $36 billion in 2005 profits), Exxon put together a little retirement package for the outgoing CEO when he left in December.

To the tune of $400 million. The retirement package includes a pension, stock options, a $1 million consulting deal, two years of home security, personal security, a car and driver, and use of a corporate jet for professional purposes.

Documents filed with the Securities and Exchange Commission showed that Raymond received a $51.1 million paycheck in 2005.

Not bad work if you can find it.

To his credit the company's market value increased over fourfold to $375 billion, passing BP as the largest oil company and General Electric as the largest US corporation. Net corporate income soared from $4.8 billion in 1992 to the record $36.13 billion produced in 2005.

Still there is something obscene in an arrangement where one man makes $144,573 per day. At the risk of sounding like a dreamy socialist, it seems to me that extreme inequities like this concentrate too much wealth and power in the hands of too few.

15 comments:

Anonymous said...

The oild companies are thieves, robber boarons.

liberal_dem said...

One wonders what Mr. Raymond will do for society with his multi-million dollar parachute.

Of course, he could play the stingy card and hoard it all for himself and his family.

Probably.

Anchorage Activist said...

This is absolutely obscene. It should be noted that the $36 billion in profit is $11 billion higher than the previous year.

Yet Exxon is crying about a proposed Petroleum Profits Tax that the Alaska State Legislature is attempting to pass. There are two versions. The House version calls for a 20% tax, with a windfall threshold kicking in at the $50 per barrel level. The Senate version calls for a 25% tax, with a $40 windfall threshold. In last Sunday's Anchorage Daily News, the oil companies and their allies took out 5 big ads opposing these measures.

This CEO does NOT deserve a $400 million severance package. What the hell has Bush done to us?

Hooda Thunkit said...

Mike,

"At the risk of sounding like a dreamy socialist, it seems to me that extreme inequities like this concentrate too much wealth and power in the hands of too few."

At the risk of agreeing with you, I agree with you, to a very large extent.

It seems to me that letting some/all of the front-line employees feast at the BIG table would do more to inspire all levels of workers to excel in their efforts.

Oh, and giving the customers a little break would likely strengthen customer loyalty too.


Whatever happened to "A good product at a fair price/profit?"

There's a lot to be said for focusing on the bigger picture vs. the next quarter's bottom line.

Anonymous said...
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liberal_dem said...

Whatever happened to "A good product at a fair price/profit?"

Good point, Hooda. Unfortunately, that concept went out with the Yugo.

Name withheld to protect the guilty said...

I know rank-and-file employees can't do much about this, but what about the stockholders? Don't they realize that these huge CEO bonuses 1) depress their own dividends and 2) demoralize the employees, leading to less inspired work, therefore lower stock prices? It's sad when people can't even be trusted to act in their own best interests.

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ToledoNative said...

And we're paying $2.79 (or thereabouts) at the pump. Incredible!


Actually, it's kinda nauseating.

-Sepp said...

With that kind of money, he'll be able to live next door to the CEO of columbia gas. Those crooks banged me for about 500 bucks a month to heat my house this winter. I think it's BS that these companies can "blame Katrina" and rake us over the coals while making record profits and then hand this clown a powerball style payout. Grrrrrr

Tom Harper said...

What's with all this bleeding heart socialism? Some of this wealth will trickle down to us peons :)

Peahippo said...

How many of you are planning and/or enacting methods of reducing your gasoline consumption?

Yes, yes, there's little you can do with all those trucks on the road hauling general goods, but your personal transport is well within your responsibility.

As gas prices soar, the "cost of conversion" becomes more affordable.

I'm seeing a LOT of those bigass trucks and SUVs sitting in various areas with "FOR SALE" signs tacked on them. Perhaps Toledoans are starting to wake up from the moron dream of conspicuous consumption?

As for me, there's a motorcycle in my future.

-Sepp said...

Record profits or not, that guys "retirement package" should have been paid out to the shareholders.

Peahippo said...

For that matter, speaking of compensation packages, how are all of you sad sacks liking your insurance rates, deductibles and uncovered (usually "surprise!") expenses? Today's WSJ has another gem frontpager:

"As Patients, Doctors Feel Pinch, Insurer's CEO Makes a Billion"

UnitedHealth's CEO (Dr. William McGuire) now draws about $8M in yearly salary plus bonuses, but "unrealized gains" on his stock options are reported to be $1.6 BILLION. Yes, folks, that's BILLION ... with a "B" ... as in BUKU. The article goes on to mention that even "celebrated" CEOs like GE's Welch and IBM's Gerstner were never subject to such a tsunami of compensation.

Even more telling from the article:

"UnitedHealth directors in the 1990s allowed Dr. McGuire the rare freedom to time his stock-option grants."

Anyone who has been following the financial news would know that stock-option timing is a major problem. Basically, it's a systemic fraud. People even go so far as to back-date forms and reports to cover this blatant fraud.

Oh well! I guess it's back to worshipping the Almightly Dollar for us all, as we spend ourselves into the poorhouse. (And when I say "us", "we" or "our" when speaking about finances, I really mean "you" and "your".)

LOKALL said...

CEO McGuire of UnitedHealth also has a very lucrative so-called "retirement" deal with the company. This agreement essentially says that when McGuire leaves the company (for whatever reason and there's no restriction on him going to work elsewhere), each year for the rest of his life, he will receive the average of the cash compensation he received in the three highest paid years. If he dies before his wife, she will receive half of that amount for the rest of her life. Check out the proxy statement for UnitedHealth. Now you tell me, does this sound like a free market capitalistic system or something else entirely?