Executive Pay limitation!

@maporsche,

maporsche wrote:

Don't democrats want companies to take TARP money if they might need it? Isn't that the great plan to rescue the industry?

Actually, my preference would be that the federal government not give failing banks TARP money. Instead, it should take over the banks, get the toxic assets off their balance sheets, then re-privatize them, just like Sweden did in the 90s. In this case, limiting executive pay wouldn't be a regulation; it would be a decision of the shareholders. There would be no question at all about the legitimacy of this.

2 Replies

@Thomas,

I like the sound of your idea better than this moronic TARP program that Obama/Bush conspired on. I'll admit that the idea of the government owning our banks does sound scary, but given the alternative...

2 Trillion and counting.....

1 Reply

@Thomas,

Thomas wrote:

maporsche wrote:
Don't democrats want companies to take TARP money if they might need it? Isn't that the great plan to rescue the industry?

Actually, my preference would be that the federal government not give failing banks TARP money. Instead, it should take over the banks, get the toxic assets off their balance sheets, then re-privatize them, just like Sweden did in the 90s. In this case, limiting executive pay wouldn't be a regulation; it would be a decision of the shareholders. There would be no question at all about the legitimacy of this.

Agreed

Cycloptichorn

1 Reply

@maporsche,

maporsche wrote:

I'll admit that the idea of the government owning our banks does sound scary,

I agree. And I wouldn't be supporting it if historical precedent hadn't convinced me that the nationalization can be kept temporary. The best precedent, which I already mentioned, is Sweden. No country epitomizes democratic Socialism as Sweden does. If Sweden can re-privatize banks a few years after taking them over and stabilizing them, so can America.

0 Replies

@Cycloptichorn,

Hell no!

The US government does not need to take over any private US companies!

http://www.athenswater.com/images/PrezBO.jpg

1 Reply

@H2O MAN,

Why not, if the alternative is to let them fail, and take down the rest of the economy with them?

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@hamburger,

Quote:

i understand that those "$500,000" executives are free to reject the cap and find a better paying job .
is the president forcing them to work for $500,000 ?
why would they accept such a job if they can find a better one ?
(and it's not like a $1 job , which someone might accept for "the good of the country" imo) .

As I stated earlier, those executives currently working at these companies (the same ones who ran them into the ground) would most likely take the $500,000 deal because noone else would hire them...but do we want those guys to stay? I say no.

So, that means shareholders fire them and hire new talent.

New talent...better talent...talent qualified to turn these companies around would NOT work for a mere $500,000 when they could find better elsewhere with less headache, less stress and NO government intervention.

So, a "salary cap" is just "salary crap" because that's all it gets you!

3 Replies

@BigTexN,

BigTexN wrote:

New talent...better talent...talent qualified to turn these companies around would NOT work for a mere $500,000 when they could find better elsewhere with less headache, less stress and NO government intervention.

"A mere $500,000"? This is more than the president of the United States makes. Are you saying that responsibly running a bank responsibly takes a better executive than being in charge of the world's largest nuclear arsenal?

1 Reply

@Thomas,

Presidents have ALWAYS been underpaid.

1 Reply

@BigTexN,

Why does the comparison makes you think that? Why doesn't it make you think that CEOs in the private sector haven't always been overpaid?

1 Reply

@Thomas,

The most powerful man in the world deserves a raise...then we might get more qualified people applying for the job.

As it is right now, more qualified individuals wouldn't take that job if it was offered to them because they can make more in the open market.

The U.S. government needs that thye are competing for talent just like everyone else.

1 Reply

@BigTexN,

BigTexN wrote:

The most powerful man in the world deserves a raise...then we might get more qualified people applying for the job.

As it is right now, more qualified individuals wouldn't take that job if it was offered to them because they can make more in the open market.

The U.S. government needs that thye are competing for talent just like everyone else.

Doesn't this just mean we'll get presidents who would value monetary gain higher than public service?

If you think about it, ex-presidents have it pretty sweet. Lifetime pay, worldwide power, exclusive access. You can't buy that with any amount of money.

I like a guy who takes the long view.

Cycloptichorn

0 Replies

@Thomas,

if they recieve tax dollars to stay operating, they immediately forfeit rights of their pay to the government.

sorry. not a two way street u peices of ****.

0 Replies

@BigTexN,

tex wrote :

Quote:

New talent...better talent...talent qualified to turn these companies around would NOT work for a mere $500,000 when they could find better elsewhere with less headache, less stress and NO government intervention.

since almost all large corporations are wilting badly - banks , insurance companies , airlines , tech companies ... and on and on it goes - i really don't know where one could find qualified executives to pull all these companies out of the downturn spiral .
we would probably need a few thousand top-notch executives to acomplish that (someone has suggested that we look to india and china to find those people - it might be a last resort) .

perhaps executives should be paid a "delayed" compensation : there'd be a decent base salary and they would only get their real payoff once the company is operating at a good (predetermined) profit for a few years .
it would be somewhat like a real estate developer who only gets his reward (pay) after the project has been completed and the space has either been sold or leased out - which may take several years .

the way it works now , many executives get large pay increases because the actual loss was not as bad as the forecasted loss - this is a rediculous way of paying for "non-performance" imo .
i've heard it argued that no qualified executive would accept a job where he would forfeit salary/bonus increases "just because the company lost money" .
canada's NORTEL (former BELL CANADA telecom giant) is a good example of that , the business and stock kept tanking year-after-year , new executives were hired every few years that drove the company further into the red - but the executives collected enormous salaries (and they also kept their executive jet) .
and if we look around us , there are plenty of those companies like NORTEL .

listened to CNBC this morning . the suggestion was usually : invest in "blue" stock corporations , but this morning they changed their tune , saying : "perhaps it might be prudent to look at small-cap companies . they might be able to survive better than the big ones " .

to sum up my thoughts :
many executives of large corporations had a very narrow field of vision .
they assumed that just by looking at their own business would be enough .
they either didn't have the foresight to constantly scan what's going on in the world and adjust their course accordingly ... ... or they were simply incompetent .
hbg

1 Reply

@hamburger,

Quote:

perhaps executives should be paid a "delayed" compensation

I will wholeheartedly agree with that...I think that is such a great idea that Obama should mandate that for ALL employees everywhere!

Let's cut compensation for ALL employees for ANY company that accepts funds from the guberment to 50% of their current income but we'll add incentive stock options that'll make up the difference in 5 years...think the auto unions will sign on to that baby?

2 Replies

@BigTexN,

BigTexN wrote:

Quote:
perhaps executives should be paid a "delayed" compensation

I will wholeheartedly agree with that...I think that is such a great idea that Obama should mandate that for ALL employees everywhere!

Let's cut compensation for ALL employees for ANY company that accepts funds from the guberment to 50% of their current income but we'll add incentive stock options that'll make up the difference in 5 years...think the auto unions will sign on to that baby?

Please, don't Appeal to Extremes. It's a logical fallacy and doesn't represent a good argument.

Cycloptichorn

1 Reply

@Cycloptichorn,

The extreme reflects the ignorance of the original argument.

1 Reply

Perhaps the shareholders (those that actually own the company) determine what the pay should be. Makes sense - they are the ones who directly have a vested interest in the company succeeding and making money.

I am not a fan of the government determining salaries of employees of companies simply because we will move toward a socialist cultural then and personally I prefer less of government butting. However seeing with the bailout - the government has a large ownership now in these companies. So if it is voted by all the owners to pay the CEO a salary of $500k + stock options then so be it.

We will find out whether this does help or not - will having a salary of $500 give us a $500k quality CEO? Hard to tell. Maybe some very intelligent business sense person will take the risk and cut his/her salary. Some one thinking longer term - it is almost a win/win situation for an unknown - if he/she succeeds, pulling a failing company out and making a success of it - that person can write his/her future ticket for almost any job later on.

0 Replies

@BigTexN,

tex wrote :

Quote:

Let's cut compensation for ALL employees for ANY company that accepts funds from the guberment to 50% of their current income but we'll add incentive stock options that'll make up the difference in 5 years...think the auto unions will sign on to that baby?

would the employees/union members also become members of a supervising board ?
there are some "co-ops" (germany's ZEISS being a good example , i believe) ,
that have a `co-ownership` betwen shareholders and workers .
fromwhat i`ve heard in the past , american business owners are not at all enthused about the idea - it would mean `sharing power`!
hbg

0 Replies

@BigTexN,

BigTexN wrote:

The extreme reflects the ignorance of the original argument.

No, it doesn't. That's why it's a Logical Fallacy.

Cycloptichorn

1 Reply

Executive Pay limitation!

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