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New York Times today details the White House appointment of an overseer to set compensation for top executives at companies currently on what I like to call "corporate welfare."  

It seems these guys just got a caseworker.  Maybe it's time for a home visit.  In what is shaping up to be the most effective use of the title "Welfare to Work," will the titans of capital finally be subjected to their own policies?

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Obama Names Overseer to Set Pay at Rescued Companies

"The Obama administration on Wednesday appointed a compensation overseer with broad discretion to set the pay for 175 top executives at seven of the nation’s largest companies, which have received hundreds of billions of dollars in federal assistance to survive."

Snip

The mandate given to the new compensation official, Kenneth R. Feinberg, a well-known Washington lawyer, reflects the federal government’s increasingly intrusive role in the corporate affairs of deeply troubled companies."

Emphasis on intrusive is mine.  Really?  Is it intrusive when Buffet  buys a huge stake in your failing company, and than tells you that things are going to change?  We bailed them out. The tax payer stepped up and gave them more money than any of us will see in our lifetimes, barring a trip to Zimbabwe.  I recall Lehman Brothers begging for a little intrusion.

The article points out that Mr. Feinberg, a Washington lawyer, will receive no compensation.  How Socialist!  or Communist!  Or something worse!  We better step in with a little bonus program for Mr. Feinberg or he is just not going to be motivated at all.  Something tells me that if the tables were reversed, private industry would be incentivizing Mr. Feinberg with bonuses predicated on the amount of "fat" he could trim from the backs of the CEOs.  Sounds like a plan!

In fact, I think what these guys need is a little dose of the unfettered, free market capitalism that has come to redefine working life in America over the past several decades.  Let's furlough them, cut their hours, make them pay more for crappier healthcare and get their secretaries to start tracking their postage and use of the copy machine.  Water coolers should be replaced with vending machines (more efficient and each employee is responsible for their own consumption).  

Next up, Obama needs to appoint a cubicle Czar, who will be conducting executive reviews with a consultant.  They will be sending out a memo detailing the need for each top executive to detail their contributions to the company.

The corner office will be gone--studies show executives work much better when surrounded with the monotone environment of gray, padded walls approximately 5 feet in height.  And we will want to make sure their computers are visible to the entire office so we can dock them for any personal time.  

Their healthcare costs are atrocious, and they demand way to much pay.  We can fire them, hire younger workers, secure H1 B visas for a replacement and outsource the rest.  Or just fire 3 out of 4, and make the remaining executive cover the work of all of them: he'll be so relieved and desperate to keep his job that he will be a real company asset.  

Of course, the most efficacious time of the year to fire executives would be right before Christmas near the start of the next corporate year and before bonuses are issued.  But maybe we don't want to waste that long because everyweek's pay is a drag on the company's bottom line.  Of course, when they do receive their Friday notification, they will have an hour to gather their things and receive an escort out of the building. Better not downsize them on a Monday or they might touch down on the hellipad at work on Tuesday, all hopped up on Hennessy and ready to shoot the place up.

Cross-posted at my blog: PinkSlipNation

Originally posted to theKK on Wed Jun 10, 2009 at 12:23 PM PDT.

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Top Executives Should Be Paid

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Comment Preferences

  •  Tip Jar (5+ / 0-)

    pinkslipnation.vox.com

    by theKK on Wed Jun 10, 2009 at 12:23:58 PM PDT

  •  Breaking the MBA rice bowl (3+ / 0-)
    Recommended by:
    Chi, slippytoad, trashablanca

    MBA have the expectation that they should either directly or via the route of consultancy, indirectly, beign given the ppower to design their own comepnsation packages regardless of their own contribution to the success of the business, regardless of any sense of proportionality with respect to income or sales, and regardless og whether the company makes any money.  They are the rightful beneficiaries of shareholder welfare goddamit!

  •  Outsource the C-level executives (2+ / 0-)
    Recommended by:
    Chi, trashablanca

    Tell me there isn't an equally capable financial/operations/marketing trained seasoned executive in India, Philippines or Ireland that couldn't run any large company as well as the over-paid and over-rated executives now running (into the ground) many US companies.

  •  Bring back the 70% income tax bracket (3+ / 0-)

    And then let them get paid as much as they like.  Use the gigantic tax revenues to pay for single-payer national health care, excellent public transportation, and free college for all who pass entrance exams.

    Big Joe Helton: "I pay Plenty."
    Chico Marx: "Well, then we're Plenty Tough."

    by Caelian on Wed Jun 10, 2009 at 12:48:17 PM PDT

  •  Last night on the news (1+ / 0-)
    Recommended by:
    sberel

    was the story that 10 of the banks "had been approved to return" billions from TARP. The reason given is that the banks want out from the restrictions that put limits on compensations for top officers.

    I'm happy to get the money back, but isn't this simply returning to business as-was-usual? Which is what we don't want to have happen again, since it f*%ked up so well the last time?

    Can't the government "approve" the returns with the provision that top officer compensations be capped?

    I know nothing about economics, so asking genuinely.

    It's not just a zip code, it's an attitude.

    by sboucher on Wed Jun 10, 2009 at 01:05:24 PM PDT

      •  I'm sorry, (0+ / 0-)

        "it?"

        It's not just a zip code, it's an attitude.

        by sboucher on Wed Jun 10, 2009 at 02:33:01 PM PDT

        [ Parent ]

        •  Meaning... (0+ / 0-)

          Should the government restrict the ability of banks to repay the loans without adding further conditions?

          The whole line of thought makes me uneasy.

          •  That's kind of my question. (1+ / 0-)
            Recommended by:
            sberel

            As I said, I know nothing about economics. It seems to me counter-productive to return to how things were before this financial crisis. That the banks are so set on going this way indicates that's exactly what they want to do, resuming their Masters-of-the-Universe way of doing business. And the bail-out will have failed.

            I can't grasp why a company would give back a billion dollars so they can pay their CEO 1.2 billion dollars. Not with all the apparent "talent" available, that retention line is bullshite.

            It's a loophole in TARP that needs to be fixed, but the horse has already left the barn. Maybe they should have said "if you take TARP, your ceo can never earn more than X times the lowest-paid," or whatever formula would work.

            Was it even discussed when TARP was formed, whether or how the funds would be paid back? I don't remember hearing about that.

            It's not just a zip code, it's an attitude.

            by sboucher on Wed Jun 10, 2009 at 03:49:31 PM PDT

            [ Parent ]

    •  No caps without a stake (1+ / 0-)
      Recommended by:
      sboucher

      When the government provides capital it has every right as any other investor or lender to impose limits on compensation or control other costs. However, unliess there is a direct investment the government has no role in setting compensation limits of any kind. The right public policy is in setting marginal tax rates. In that way high income individuals across the board, not just corporate executives but also athletes, entertainers, physicians, lawyers and many others, pay higher taxes.

      "let's talk about that"

      by VClib on Wed Jun 10, 2009 at 05:48:40 PM PDT

      [ Parent ]

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