The Bush administration has taken the approach that business can do no harm. So we have had eight years of the fox guarding the hen house. Adding a few more thoughts to yesterday's Sunday Funnies: Business should have NBA type salary cap. The subject of executive pay at public corporations sometimes raises eyebrows, sometimes raises voices, and often loud protests.When companies perform poorly financially and it is reflected in the share price the protests are even louder and more justified.
Like they say about pornography... When executive pay becomes so high that it becomes obscene, you may not be able to define it exactly, but you know it when you see it!
Unfortunately these protests are not coming from the board room, or large institutional investors or pension funds, although they should! They come from the "hard working stiffs" that go unheard and disrespected -- and the common shareholder.
Why no competition? Given that executive compensation in the United States is out of whack with the rest of the planet I was wondering why there is no competition for these jobs from overseas. If U.S. companies are exporting service and manufacturing jobs to reduce cost then why shouldn't the same corporate boards be importing CEO's, and other executives for the same reason?
Beyond the outlandish Compensation includes a long list of perks including: housing assistance, tax relief, corporate jets, personal loans and many more components to the executive package, some justifiable some highly questionable -- Can you say "back dating stock options" -- the Feds can! We have not heard the last of this either.
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.
Closing Bell: Economic Catapult for Thanksgiving & Black Friday (WMT, TGT, GRMN, GOOG, MSFT)
Deere up on Q4 earnings performance
Reid Hoffman: LinkedIn will go public (at some point)
Reader Comments (Page 1 of 1)
7-07-2008 @ 6:29PM
bill said...
is aigs former chief getting 47 million in back dated stock. maybe then he will be getting only 500% of what he was worth. all the losers are getting fired and still drawing big bonuses for screwing up the economy along with the help of george. time for a change to communism i guess . this sure isnt a free country anymore.
7-07-2008 @ 6:58PM
Philip Block said...
Blame Bush for everything. What corporations do with salaries and compensation is none of the government's business. If you don't like it, don't buy the stock. Blame the lousey tax system. Would you perfer the money go to the govenrment so the bunch of corrupt politicians in Washington, D.C (District of Corruption) can us it to buy votes. Liber need to learn something about business before he writes hate articles.
7-07-2008 @ 7:38PM
Sheldon L said...
Bill,
Not for changing the system just doing some fine tuning -- and communism has proven itself to be a disaster. Bush has just been Bush...and that has proven itself wanting too.
Phil,
Nothing I wrote implies that I believe the government should extend it's reach into anyones pocket any more than it has and I would be for less government, as you have indicated you are.
However, one of the major roles of government is to make sure the playing field is level and this administration has made no attempt to do that. Individual investors that hold index funds, ETF's or a part of pension funds do not switch from stock to stock and are still affected by the lying cheating and stealing in the board room.
I do not blame Bush for everything, but he certainly has ignored many areas of responsibility and leadership that I had hopes he would find reason to address. The hate part is silly, while others may go that far and you have included me in your broad brush strokes, this seems reflective of your tone not mine.
Lastly, your making your comment so personal when you are so frustrated is offensive. I am quite confident that you would find yourself in an embarrassing situation debating me on most business subjects. That said, if there is a subject you would like discussed on our site just say so because it might provoke some interesting discussion and I would be happy to oblige you.
Peace always
7-09-2008 @ 2:09PM
Alan said...
Oh, yes, the "free" market that so many associate with democracy: one dollar, one vote. Pretty soon, a handfull of people have billions of votes and the rest of us have - - - well, not enough to influence anything.
Blaming taxes, like we've been doing the past 30 years, sure has helped the system get better. Levelled the playing field real nicely, that did. We're so much better off - - - -.