As a hoary technophobe, I’m skeptical of the NMJMT— I’d prefer to continue granting lavish compensation to all existing CEOs, to avoid alienating the precious handful who might actually deserve it.
There are lines of back stabbing corporate flunkies waiting in line to install their management teams and have their turn at looting. But when a corporation loses 21 billion in its last quarter ,how does an exec deserve a bonus? He should be fired. How much damage do you have to oversee before it is clear something is wrong?
The “magic job making machine” you are referring to is entrepreneurs and competant businessmen who decide to buy up cheap equipment from the failed bloated businesses to start their own new businesses. They will probably staff their new companies with people who already have experience in the industry.
Well…sort of. That’s certainly what I would mean. However, I suspect that some folks actually think that these companies grow on trees and that really, anyone COULD make them…it’s just that the fat cat rich folk do in order to keep the masses down. Or something.
Yeah…if the companies go TU then many of them will be restructured or absorbed by someone else. I’m a big fan of survival of the fittest in the market place…which is why I think bailouts are a bad thing, ehe?
-XT
Thought I’d include this article from CNN into the discussion:
-XT
But who are “these guys”, from my reading of this restriction it applies to whoever is CEO at a bailout company; meaning if they’ve long since fired the guy that ran the company in the ground they can’t pay the new guy more than $500,000 no matter how qualified he is.
So you’ve just said there’s not a single CEO in the world who is anything other than an incompetent crook? How can you legitimately post on a forum like this, that vaunts the open exchange of ideas, with an unwaveringly absolutist position like that?
Stick around a while - this is hardly the most unwavering absolutist postion you’ll find around here.
And then they’ll probably get eaten up by a bigger corporation and the “horde of low paid but very talented CEO’s in waiting” will get collectively fired to make room for the golfing buddies of the CEO and the Board of Directors of the bigger company.
Our CEO pay has become distorted . They are way ,way over paid. That was true when they were able to convince fools that they actually knew what they were doing, and the companies appeared to be making money. It was smoke and mirrors. They were setting up a system to enrich themselves. They were selling the creation and movement of debt. They were scammers and should be fired. How can you reward yourself a multiple million dollar bonus when the company is losing billions and on a highway to disaster? Oh wait ,because they are irreplaceable financial geniuses. Yeh right. They should be in jail with Madoff.
OK, Martin, you are almost to the point of understanding the left. We know that’s how the system works. We hate that it works like that. We want to change it. We would like the poor to weather the storms just as well as the rich. Social safety nets and all those things you hate. We think it can be done. It will be done. It might take some time, but that overall is the direction that civilization is moving in. Conservatives are just so many boulders in front of the glacier.
The first thing any manager will tell an employee is that “everyone is replaceable.” It’s as true for CEOs as it is for assistant managers. As a whole, the CEOs in the financial sector have fucked up royally. Give some new guys with fresh ideas and better scruples a chance. This notion that we should be worshipping these CEOs was bogus when the financial industry scams were still working. Now that they’ve collapsed, anyone can see that financial sector CEOs are, as a class, irresponsible fools. Sorry if you don’t like it, but the evidence is irrefutable.
http://www.scotsman.com/latestnews/Axe-falls-in-RBS-boardroom.4957304.jp Here’s an article about Royal Bank of Scotland. They are going through the same arguments there. But their execs, while horribly overpaid, are not at the level of our execs.
The execs argue that while they are losing billions, they should just get smaller bonuses instead of none. They should get a smaller award for destroying the bank than they normally get. The argument fails me. If You screw up .you are in the street looking for a new job. They feel screwed over if they don’t get the millions they feel they are entitled to.
Yes, you would like a system that basically just pays people regardless if the work they do is valuable or even if they work at all.
I can never figure out why you Liberals think that the government is the best and most fair allocator of resources.
I’ve never had a manager say that. I’ve never told anyone that as a manager. It’s not something they teach you in business school or in any management training program.
State Street Bank is slashing compensation for executives, starting at the top:
Notice that the bank’s share price rose on this news.
Compared to the capitalistic distortion that we have evolved into, the government is a far more reasonable allocator of everything. It actually has input from people who are not absorbing all the wealth for themselves.Corporations are not democracies. They are dictatorships of the powerful and rich. The distribution of the corporation wealth is terribly distorted. I was going to say the profits . it does not matter if they make money, they will still carve out a chunk of the corporation to enrich themselves. When they eliminate jobs ,they make a lot more money. When they escape environmental problems ,they make more money. When they ship jobs, patents ,technology ,and entire industries abroad,they make more money. What a fine system. If they avoid taxes they make more money.
Yes, companies exist to make money. God forbid. And they are much more tied to economic reality than government. Government will legislate and tax and spend according to the whims of the people, building bridges to nowhere and paying people to sit on their ass collecting benefits. Corporations do the same thing but eventually the economics will take care of waste if people let it.
The problem is that people are mostly lazy and stupid. They hate the corporations for their greed one minute but then they demand the government protect their jobs the next, essentially rewarding the very behavior they don’t want.
The so called “looting” you people talk about has been a common one for a long time. In business school we called them agency issues. How do you ensure that your management is acting in the best interest of the company and not their own short term financial interests?
Keep in mind that government doesn’t make anything. Everything you see around you was created by some company formed by some entrepreneur.
If we assume that the bailouts are inevitable and that the execs are partly or mostly to blame for their company’s mismanagement then I’m totally in favor of the limits. I don’t want to set up incentives for execs where they can artificially boost their company’s fortunes and then get a government funded reward when it all collapses.
I’m generally not in favor of the bailouts but if they are going to happen then this seems as an intelligent way to do it as possible.
I unequivocally disagree. Mao’s Great Leap Forward was far more disastrous than the current financial melt-down.
No, that’s what the Right wants - for the people at the top at least. The Left just doesn’t want ordinary people to have their lives destroyed.
Perhaps companies are, but CEOs and the rest of the higher ups AREN’T. Quite often they get rewarded in the inverse of economic reality, in fact. They don’t even need to worry about elections like a politician does - even if the company fails their buddies in the next company over will hire them. At least Bush isn’t going to be made President of Canada.
Garbage. Government makes and maintains a great many things. Nor are “entrepreneurs” all that huge a force in the corporate world; mostly, corporations are run by parasites.
Ah, the “Anything but the far right is Communist !” routine. Obama isn’t Mao, any more than modern CEOs are as bad as Old South slave plantation owners.
I don’t have any problem with social safety nets; but you’re living in a dream world if you think we’re moving away from free markets. As China has transitioned into a market economy you’ve seen pretty much the last major vestige of the failed idea of planned economies disappear.
As long as there’s a free market there are going to be winners and losers. There will never be a society where the poor can “weather the storm” as well as the rich, unless you do away with the rich entirely. As I’ve pointed out though, we’re moving away from such ideas, not towards them. I’m fine with us making sure the poor don’t starve in the streets during economic downturns, but there’s never going to be a world where the lower class will have the option of retiring to their mansion in Cayman Brac when the Fortune 500 company they were running goes under.
There’s many bad CEOs. But generally speaking a CEO is more a “big ideas” man than a micro manager, for this reason sometimes even the best CEOs won’t be able to singlehandedly save a company when the economy is going down the drain. Some industries you are extremely vulnerable to market fluctuations. I agree that financial sector CEOs “as a class” have recently made some colossal missteps, but I fail to see how these companies are best served by not being able to bring in good people. These caps, from what I’ve read, would apply to new hires as well, people that may not have even worked in the financial sector prior to this.