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Post by AustinHoya03 on Feb 4, 2009 18:38:54 GMT -5
apnews.myway.com/article/20090204/D964VSP00.htmlMy thoughts: I dislike ridiculous bonuses and ludicrous executive pay. I dislike irresponsible shareholders that make them possible. But this is the wrong solution. IMO, the bailout will fail if all it provides is money with lots of strings attached. And yes, I realize these rules will affect very few corporations. It's the message being sent that bothers me.
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TC
Platinum Hoya (over 5000 posts)
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Post by TC on Feb 4, 2009 18:41:55 GMT -5
What's the right solution?
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Post by AustinHoya03 on Feb 4, 2009 18:46:31 GMT -5
What's the right solution? Shareholders grow a pair. (It won't happen, but this is somewhat akin to answering the question of "how do you get rid of Holocaust deniers?" In the United States, the answer is not more government regulation, though that would be the most efficient method.) |
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Bando
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Post by Bando on Feb 4, 2009 19:03:53 GMT -5
If $500,000 isn't enough to keep the current executives, then let them leave. They're the ones who massively screwed up, no?
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The Stig
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Post by The Stig on Feb 4, 2009 19:06:49 GMT -5
It's simple supply and demand. Companies think they have to shell out ridiculous amounts of money to get the top talent, and the executives aren't going to say no to that.
I don't have a problem with successful executives being rewarded. My problem is that it's too easy for executives to hold onto their jobs even after they've driven their companies into the ground. As a follower of the airline industry, I can't count the number of times that a CEO has driven their airline into Chapter 11 and still been at the helm when the airline came out. Some of them are working very hard to get a 2nd bankruptcy under their belt.
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Filo
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Post by Filo on Feb 4, 2009 21:50:32 GMT -5
It would be nice if things started with the Boards of Directors, whose Compensation Committees approve of a lot of the excesses out there. Talk about needing to get a set. Most of them are nothing but Boards of Rubber Stampers who show up for periodic free lunches and collect money and even stock options for doing nothing. No independence and no accountability when things blow up.
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TC
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Post by TC on Feb 4, 2009 22:37:22 GMT -5
Shareholders grow a pair. (It won't happen, but this is somewhat akin to answering the question of "how do you get rid of Holocaust deniers?" In the United States, the answer is not more government regulation, though that would be the most efficient method.) Right. The Rockefellers (with a ton of support) can't win a proposal at Exxon, and you want some populist shareholder revolt to limit executive pay? |
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Post by AustinHoya03 on Feb 4, 2009 23:47:14 GMT -5
Right. The Rockefellers (with a ton of support) can't win a proposal at Exxon, and you want some populist shareholder revolt to limit executive pay? That is precisely what I want. Everyone, please get your pitchforks and torches out of storage -- we'll take these bitches down like Eisner. I don't want governments to limit executive pay. However, I think executive pay should be limited. Ergo, I support limits imposed by forces within a corporation itself. As I said above, I don't expect self-imposed limits to be put in place anytime soon. That's hardly screaming revolution. My position is merely that the government undermined its own goals WRT the economy by putting these rules in place. (Also, "The Rockefellers (with a ton of support) can't win a proposal at Exxon" is a contradictory statement, unless your definition of 'a ton' is 'not enough to win.') |
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Boz
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Post by Boz on Feb 5, 2009 9:35:11 GMT -5
I'm still waiting for President Obama to explain to everyone just exactly what it was he meant by "now is not the time for profits."
(more accurately "There will be a time for profits and a time for bonuses. Now is not that time.")
Saying now is not the time for bonuses? OK, I can see that from a populist angle, even though I don't agree with it. Now is not the time for UNDESERVED bonuses, most assuredly. The time for undeserved bonuses is.....well, never.
But exactly why should all businesses NOT be striving for more and improved profits, not just now but always?? Actually, particularly now, as a matter of fact, for those businesses receiving government assistance. And if they achieve those, then yes, it's also the time for bonuses.
That is some scary language, IMO.
EDIT: And, I might be wrong, but I'm pretty sure not a single network/cable anchor asked the President to elaborate on this during the "I screwed up" world tour. Shoddy journalism there, if I am right.
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Cambridge
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Post by Cambridge on Feb 5, 2009 10:05:20 GMT -5
I think this is a stupid decision and a bow to populism. Why would talented people help to rebuild these companies if their compensation is going to be capped? If anything, people should be paid a premium to help rebuild these companies if we want them to survive.* This is like demanding the best medical care available for a gravely ill loved one and then capping the compensation for the surgeon at a fifth of the average fee. Good luck finding the care you want.
It reminds me of when the Harvard faculty got up in arms and had the Board of Governors remove Jack Meyer from his position managing the endowment because he was earning a percentage of the growth (a lower percentage than he would have earned on Wall Street) - which gave him much more compensation than anyone at the school. Stupid decision. I'm sure they would have preferred to have had Mr. Meyer at the helm during this crisis.
*This is the assumption I'm making based on our efforts to bail them out. I personally would rather see them fail. But, if we are, and it appears we are, committed to saving all these companies we should be attracting the best and the brightest to do so. I agree that inept executives shouldn't be paid huge salaries and many companies have made that mistake, but that doesn't mean that good executives aren't worth every penny.
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TC
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Post by TC on Feb 5, 2009 10:50:51 GMT -5
That is precisely what I want. Everyone, please get your pitchforks and torches out of storage -- we'll take these bitches down like Eisner. Good luck, but a lot of companies require super-majority votes (75%) vs. simple majority votes (50%). The deck is stacked against populism by shareholder more than it is stacked against populism by government. Some companies even have had proposals to try to further limit shareholder activism in recent years. And yes - when the Rockefellers get 40% of the vote to change the long-term direction of a company, I consider that "a ton" of support. |
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Post by Coast2CoastHoya on Feb 5, 2009 14:02:56 GMT -5
Derivitive suits are our friends .....
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