Where does this billionaire jurist and party shit come from? McCormick grew up in Delaware as a small-town girl, with two teachers as her parents. She did wonderfully well in school, attended prestigious universities, and ended up putting all her fancy degrees to work for people of limited means. She now heads the Delaware court that has become the primary ring where America’s biggest corporations settle their internal disputes.
And the beatings on Tesla became fierce. On one side: the corporate executives of Tesla, Musk’s creation that became the world’s largest supplier of high-tech electric cars and trucks. On the other, a shareholder challenge to the corporate insider who has fabulously enriched Musk and his closest cronies.
Musk’s current Tesla CEO compensation plan, notes CNN Business, handed Musk “the greatest compensation package for anyone on Earth from a publicly traded company.” The plan’s key “performance” indicator: Tesla’s share price. The higher this price, the more Musk pockets new Tesla shares. Last November, that connection had inflated Musk’s personal fortune by as much as $315 billion.
Musk’s personal net worth currently sits at “just” $189 billion, still enough, according to the Bloomberg Billionaires Index, to rank as the world’s largest personal net worth, some $30 billion more than the value. net worth of the second richest person in the world. By comparison, in March 2018, the month Musk Tesla’s compensation deal went into effect, some 40 billionaires worldwide passed Musk on Bloomberg’s billionaire charts.
In 2018, leading shareholder advisory firms recommended Tesla shareholders dismiss the compensation deal that Tesla’s board of directors – a panel that included Musk’s brother and various close friends – wanted to hand over to the company’s fearless leader. Tesla’s board CEO compensation plan, an analysis of Institutional Shareholder Services noted, has provided Musk with “compensation opportunities over the next 10 years that eclipse those of top executives at the most public companies.” important and most profitable”.
Musk himself, the ISS analysis added, already had plenty of incentive to work hard for Tesla’s success. He even owned 22% of Tesla shares before its new CEO compensation deal would go into effect.
Shareholder Richard Tornetta agreed with that analysis and filed a lawsuit against Musk’s compensation plan months after Tesla’s major shareholders greenlighted the deal in 2018. That litigation, now a class action lawsuit, has made its way through the court system. from.
The trial on the merits of the lawsuit finally began earlier this week before Delaware Court of Chancellor Kathaleen McCormick. His decision will likely be made within the next three months.
McCormick’s previous decision against Musk came in a case that involved his decision to walk away from a deal he made last spring to buy Twitter. Musk subsequently, after McCormick’s decision, had no choice but to go ahead with the purchase, and now he’s wildly trying to get the others – he’s already fired the half of Twitter’s workforce – are paying the price for its impulsive, overpriced takeover bid.
But even if McCormick comes out against Musk again in the current Tesla case, Musk will still walk away fantastically and unreasonably rich. On the other hand, he will not leave happy. Musk’s ongoing Twitter debacle and now the Tesla litigation have damaged his reputation as an unprecedented business “genius”, which should be a fatal blow.
During cross-examination in McCormick’s Tesla courtroom, for example, Musk once had to admit that Tesla’s original vision did not come out of his own personal genius, something he has claimed for years. .
In Elon Musk, America now sees clearly, we don’t have superheroes. Musk turns out to be as flawed as the rest of us. The only difference: the richest man in the world, at the end of the day, has the power and the wealth to make others pay for his missteps.
Musk also benefited, unlike the rest of us, from billions in taxpayer subsidies. Documents to his electric car, solar panel and spaceflight businesses – all “long-term start-ups”, the Los Angeles Times detailed — gave his businesses their secret sauce. These grants launched Musk’s unprecedented personal fortune.
So what can we do to prevent yet another “brilliant” entrepreneur from building a fortune on our ideas, our work and our taxes? We can start withholding subsidies from companies that pay their top executives hundreds of times more than they pay their workers. We can tax the rich at much higher rates.
And we can put Elon Musk on top of a rocket and send him where he’s always wanted to go – to Mars.
Sam Pizzigati co-edits Inequality.org. His latest books include The case of a maximum wage and The Rich Don’t Always Win: The Forgotten Triumph Over Plutocracy That Created America’s Middle Class, 1900-1970. Twitter: @Too_Much_Online.