Thursday, October 22, 2009

Enter the "Pay Czar"

No, you didn't wake up in Communist China or the former Soviet Union this morning (although either one of these countries is arguably more capitalist than we are any more). You woke up in the Brave New World of Obama where the "Pay Czar" dictates executive pay:

WASHINGTON (Reuters) - Top White House economic adviser Lawrence Summers said on Wednesday the administration's pay czar will "substantially reduce" the paychecks at firms that have received billions of taxpayer dollars.
"With respect to the companies that have been major recipients of federal support, Ken Feinberg is reviewing them...(and) will, I suspect, produce an outcome where they will be very substantially reduced," Summers told the Reuters Washington Summit.
Feinberg, the pay czar appointed by President Barack Obama in June, is expected to cut total compensation by an average of 50 percent for the top earners at seven bailed-out firms, sources familiar with the matter said on Wednesday.
The administration has faced public outrage, as Wall Street firms that were recently propped up by federal assistance have brought their bonuses back to pre-crisis levels even as the general population faces the highest unemployment level in 26 years.

Some might argue that these folks make to much anyway and that their firms took government money and if you are in bed with the government, the feds dictate the terms of your employment.  First of all, who in the hell are the feds to be dictating how much money a CEO makes? This is a decision that should be made by a board of directors that is elected by the shareholders. Secondly, now you see why these "bailouts" were a crappy idea in the first place. If the CEO does such a lousy job that his company fails, let it fail. That's the free market. No company is "too big to fail". Are these banks and automakers any better off with the government money than without it? Hell no. Just ask the folks at the Ford Motor Company whose executives aren't having their pay dictated by a "pay czar" because they didn't strike a deal with the devil.


Anonymous said...

There are to meany uneducated far left radical liberials who fail to see thay they are on the way to destroying this Great Country, U.S.A. I think the ones who are going to suffer most from the damages already created by big gov, are the children of the future. There is something that is just NOT right about the Barack Hussein Obama adminastration. I just have a realy bad feeling.
Dr Doc dlcs

Conservasteve said...

Yeah, it's a sad fact: If this keeps up our kids will be the first generation NOT to live a little better than their parent's generation. There's no way in hell we're going to pay of $20 trillion in national debt PLUS pay the unfunded liabilities of that Ponzi scheme called Social Security, Medicaid and Medicare that total $100 trillion. It makes me sick.