Thursday, January 26, 2012

Presidential Paycheck

It's easy to say that our presidents didn't get into the job for the money. The power, now that's another story. The president does get paid a lot, but there are plenty of other jobs that pay much better. Our current President makes $400,000 a year plus a $50,000 dollar expense account. Compare that to presidential hopeful Mitt Romney. Romney recently released his tax return and according to it he makes around $22.5 million every year. In other words, he makes about $57,000 a day. So give him around eight days and he's already making more than the president gets from the government. Romney comes from a wealthy family, plus a lot of the income comes from the time he spent as founder and partner of Bain Capital, a private equity firm. So it's really safe to say that Romney is not in need of that sweet presidential paycheck. Obama may not have a large company that he founded, but he still did pretty well last year with a total of $5.5 million, most of that coming from book sales.

Logically, you'd think that Obama is the highest paid president, as the presidential paycheck has gotten higher and higher over time. Not true. Obama is in fact number 8 on the list of lowest paid presidents. How is that possible? Inflation my dear boy! Think of it like the list of highest grossing movies of all time. Avatar is the highest grossing movie in total earnings. That isn't adjusted for inflation however. When adjusted, Avatar goes all the way down to 14th, while topping the list is Gone With the Wind. Bet you didn't expect that. Well, some of you might have. Anyway, going by the way inflation works, the highest paid president could basically be anyone. The answer may surprise you: William Howard Taft. Yes, the man who got stuck in a tub was our best paid president. Taft was paid just $75,000 dollars a year in his time. In our time however, he was making $1,445,454 a year. Mckinley, Nixon, Wilson, Theodore Roosevelt, and Cleveland all made over $1 million a year when adjusted for inflation. Who got paid the least then? Bill Clinton, that's who! Clinton made $200,000 a year plus a $50,000 expense account, which is worth $282,648 today. Other presidents on the lowest paid: Andrew Johnson, Madison, H.W. Bush, John Adams, Lincoln, Jefferson, Monroe, Obama, Reagan, and Washington.

Most of the lowest paid come in before President Grant because they all made $25,000 year. It wasn't until Grant's second term that Congress started giving presidents raises. Why give the presidents raises? It's not because the president is underpaid, but because Congress feels it is. "Traditionally, no government employee can make more than the president. Yet unlike the president, many of them have built cost-of-living increases into their salaries. When their pay starts butting up against that of the president's, they tend to become more generous." A few fast facts about presidents and their salaries:
  • Presidents since Truman have had a $50,000 expense account.
  • George Washington, Herbert Hoover, and John F. Kennedy refused their salary (Washington instead had a never ending expense account, Hoover and Kennedy were already loaded).
  • While many presidential expenses are picked up by other departments and agencies, not all of them are: Thomas Jefferson left office owing $10,000 just for wine (Jefferson was terrible with money).
  • Incidentally, the two presidents who were impeached are also the two lowest paid presidents. Somehow Nixon is the third highest.
  • Presidential pensions started being doled out by Congress in 1958. It started out at $25,000 per year and included both and office and staff. The payment is now based on the annual pay of a cabinet secretary: in 2001 this came out to $161,200.
  • Joe Biden doesn't get peanuts either. He receives around $220,000 a year for being vice-president.
Do the presidents deserve such a paycheck? I think so. They are the leader of the free world. Plus plenty of presidents before Super Pacs had to put in a bunch of their own money into running for office. They might as well make a little of it back. Plenty of the presidents could have used the pension money, as some had to write a book(Grant), or take up other positions to keep afloat the rest of their lives. Some were not so lucky. Remember how I said Jefferson was bad with money? Though he was born into a rich slave owning family, Jefferson died deeply in debt. Too much interior decorating and partying. I'm serious. So, don't ever feel bad for the presidents from the last sixty years or so. They did rather well for themselves and a lot of the more recent ones have all written books to help boost their net worth. I guess my whole point is: our presidents are filthy rich.

Romney Tax information from:

Obama annual income from:

All other information from: Uncle John's Bathroom Reader Plunges into the Presidency. "The Buck Stops Here." Pgs. 79-81.

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