March 24, 2010

Whine on, executives

It's long been an article of faith that executive pay, which has been growing at a breathtaking clip over the last 30 years, is earned (deserved, even!) because only these people are uniquely talented and able to do this job. Without them, our nations firms would all collapse.

As we all know from the last 4 years, that's wasn't so much right. And when the federal pay czar, Ken Feinberg, decided to implement pay limits at companies that received federal money, we thought this was not only a brill idea, we actually waited for the indignant flood of incompetents who would flood out of the companies, only to be replaced by people a whole lot cheaper.

As it turns out, that didn't happen.

“For months, Wall Street banks and the troubled automakers feverishly protested that their top executives would flee if they were not lavishly rewarded for their talents. New data, however, suggests the departures were more of a trickle than a flood.

Of the 104 senior executives whose pay was set by the federal pay regulator in the last two years, 88 executives, or nearly 85 percent, are still with the companies even though their pay was drastically cut back, according to people briefed on the government data.

The relative stability, at least within the executive suite, suggests that a soft job market, corporate loyalty and personal pride helped deter the feared management exodus at the companies hardest hit by the pay rules.”

I'm tired of lousy, overpaid, petulant management. Rise with me, fellow shareholders, and let's ask Ken Feinberg to serve on compensation committees for companies all over the US.

Posted by mcblogger at March 24, 2010 08:48 AM

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