Saturday, February 7, 2009

The Arguments against Executive Compensation Caps for Bailout are Frakking Bull

It was so annoying to hear all week the whining of the executives and the executive class (Republicans) complaining about how the compensation cap ($500K max, with possible stock options that can only vest after the bailout money is paid back) is anti-free market or how it will prevent companies from retaining good people as execs flee for higher salaries elsewhere. The bullshit is piled so high in those statements I don't even know where to begin.

First, it is rather rich to complain about how this is anti-free market when it is tied to companies getting billions of dollars of taxpayer money, which is billions in pure welfare. When you are getting welfare, you don't get to set your compensation. And hell, this isn't even anti-free market. This is a pure free-market exchange - value traded for value. In exchange for limiting exec compensation, they get billions of dollars. They are free to reject the billions if they don't think it is a good deal. Or rather, the corporation is free to reject it. Don't like it, don't play.

Second, the arguments presume that there are all these "good people" at these companies, yet aren't these the very same companies that were run into the ground by the "good people" who are now whining about compensation? If you screw up your job, get on your knees, kiss the groud, and be thankful you aren't unemployed.

Third, the big assumption here is that $500,000 is somehow not a very good salary, when it is so ridiculously good that only a very very very tiny elite will EVER make that much money in a year. And other perks come along with it, along with options that would vest when the bailout money is paid back, and I don't think there is any limit on THAT - so it seems what they are really saying is they have absolutely no confidence that they'll be able to pay back the billions and get their options. This would seem to be rather at odds with the whole "good people" who are worth much more notion above.

Fourth, this economy SUCKS. If these bozos really think they can quit and find a job that pays more, with a resume from a failing company, more power to them. I somehow doubt we're going to see these execs actually leaving when the cap is in place, proving that this was just bluster and bullshit. Right now even people with ridiculously stellar resumes can't find ANY job, much less one that pays in excess of $500,000 per year. For instance, I heard on NPR that ex US Attorneys, leaving office as Obama takes over, are out of work and unable to find jobs. This is unprecedented. Usually, an ex US Attorney can write his or her own ticket and get a job anywhere he or she wants. That so many of them are not only not getting plumb offers, but are getting no offers at all, shows just how bad things are. So no executive is going to be finding higher paying work. Heck, probably half of the places they could go to are getting bailout money and wouldn't be able to offer more anyway. And the rest, they are too busy laying people off or going out of business to look at resumes for new hires.

In short, these arguments are so transparently stupid and illogical that they could only be thought up as bullshit GOP talking points. Someone should tell these bozos to quit whining.


Erin said...

THANK GOD I am a teacher who doesn't own anything but cats and a van. I may never break $50K, but I won't be foreclosed on and I'll always have work. Is what those CEOs do REALLY more than ten times more important than teaching their kids to read?

The Barefoot Bum said...

The bourgeois ruling class takes care of its own.

Ready to join the revolution yet?

DBB said...

Erin - the CEOs don't think they are worth ten times teachers - they think ten times is far too low - they think they are worth 100 to 1,000 times what teachers earn. And they think they should get it regardless of whether they actually do a good job.

Larry - I am ready to topple the status quo. It just disgusts me. Though I am optimistic enough to hope things will get better, I am also cynical enough to think that even if there was a revolution, we'd just get a new ruling class that does exactly the same thing, because that is what ALWAYS happens, with no exceptions in history thus far.

Maybe a new human colony in space is the answer. Picking up and starting over in a new place and saying to hell with the messed up world left behind.