The Rabid Conservative

Think Right, Act Right, Be Right.

In Short – Middle Ground for the Corporate Pay Question

with 2 comments


President Obama this week is clamoring on restricting the pay of corporate executives, riding on the coattails of the corporate populist ballyhoo of AIG paying out bonuses to people who were contractually entitled to the bonus.  Lately, though, the liberal government’s need to regulate how companies pay their people is really approaching socialism.  Now I can see the government stepping in with a voice when federal taxpayer money has been committed to bailing our a company that’s deemed ‘too big to fail’. But Obama wants to do this across the board.

Of course, we don’t worry about limiting the pay of professional athletes who make $5 million to hit or throw a ball as a pro sports all star, but the Dems want to penalize corporate all-starts/executives by capping their pay.

Anyway, here’s an idea. Since America’s political strength is in our ability to reach compromise, I propose the following as a solution:

Any company receiving TARP or whatever Federal bailout money should agree that, within 90 days, they call a meeting of their shareholders and put the subject of executive compensation on the meeting agenda. The shareholders vote as to whether the CEO making $800,000/year is too much.  The results of the vote are reported back to the government before any dispersal of money.

To me, this sounds reasonably fair.  The decision of compensation is left to the one to make the decision – the corporate shareholders, and the government can call it regulated because it ensured that the people who make the decision are given the opportunity to make the choice for themselves.

Think I’m off base? Shoot me a comment.

(Side note: The Dems have been squawking about corporate bonuses being paid out by contract to AIG employees, yet we don’t give any consideration that UAW and other unions are basically extorting the auto makers for nearly half of their revenue to pay for people who no longer produce anything.  Yet we don’t see the Dems all over that)

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Written by The Rabid Conservative

March 24, 2009 at 11:12 am

2 Responses

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  1. Remember it is a strategic competitive advantage to the stronger banks that the weaker ones have their exec comp limited… I don’t think Barak Obama will stand up to the execs at the stronger banks. I’ve just posted on this, in case you are interested.

    euandus

    October 22, 2009 at 9:49 am

  2. It’s been the policy of this administration to artificially tilt the business world towards the political agenda – contrary to the will of the Founders. Barack Obama probably won’t stand up to them because he needs them. To ObamAd, Inc. these bankers are a necessary evil, even though the bigger challenge is to pull that money into government so it can be dispensed for liberal program spending. This is precisely what he wants to do.

    I just read your post and I believe that any decision to limit executive pay should come from the shareholders – not the government. However, these large businesses sold their souls when they took the bailout money – they knew there would be a consequence. And now the piper calls…limit exec pay or go away.

    As for Federalism itself, well, its coffin started getting nailed back in the 30’s when FDR began the process of socializing business and creating regulation. Every Democrat in the presidency since then has moved for that.

    Government control…that’s what it’s about for them.

    Thanks for writing in and reading The Rabid Conservative

    Rick

    October 22, 2009 at 10:14 am


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