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Executive Pay and the 'Market Economy'
It's pretty hard these days to justify astronomical executive pay. In 2007, the average CEO's pay of $10.5 million was 344 times higher on average than the average worker's wage, according to Executive Excess 2008, a joint report from the Washington, D.C.-based Institute for Policy Studies and Boston-based United for a Fair Economy. The top 50 private investment fund managers each took home more than 19,000 times the average worker's earnings.
But never fear, Jack and Suzy Welch -- the former high-flying CEO of General Electric and his wife, the former editor of the Harvard Business Review -- are willing to defend high executive pay by return to first principles and invocation of "the market economy." In a recent issue of Business Week, they write, "Yes, most CEOs make a ton of money, and sometimes they make too much, but in a market economy salaries are set by supply and demand. We also live in a market economy where companies that field the best teams win, and, because of global competition, the best teams tend to be expensive."
There are several decisive rebuttals to this claptrap.
First, there is no plausible market-based story why executive pay should have been bid up so much over the past quarter century. Are executives working harder now? Making better decisions? Has the CEO supply and demand equation changed?
Second, executive pay is not set by the market, but by boards of directors, who frequently are CEO cronies and excuse their behavior by relying on conflicted compensation consultants.
Third, the most super-high compensation packages are typically based on performance standards, with executives cashing in on stock options as share values rise. But this is a system easily gamed, with those same shares sold before short-term thinking leads to medium-term losses. By way of example, consider the massive pay packages obtained by the ousted CEOs of the now-floundering Wall Street firms.
And now comes a new analysis that further debunks the market-based rationalization for ridiculous CEO compensation levels. Executive Excess 2008 shows how taxpayers are helping foot the bill for these outrageous compensation packages.
Executive Excess 2008 highlights five distinct U.S. tax subsidies for executive pay. These are actually market distorting, in that they let top executives and investment fund managers take home more than they would if they played by the same tax rules as regular people. Altogether, Executive Excess 2008 reports, the five tax loopholes heap $20 billion in subsidies on the corporate and hedge fund honchos.
* The hedge fund manager loophole, involving what is called "carried interest," enables investment fund managers to treat most of their salaries as capital gains, and to pay taxes at the capital gains rate, rather than the ordinary income tax rate. Annual cost to taxpayers: $2.6 billion.
* The pensions for the rich loophole. While regular people can place a maximum of $15,500 in 401(k) plans -- deferring taxes until they withdraw the money -- CEOs can place unlimited amounts in deferred pay plans. Annual cost to taxpayers: $80 million.
* The offshoring loophole. Although companies cannot deduct the expense of executive compensation in deferred accounts, this is no problem for businesses registered in offshore tax havens. Set up an offshore subsidiary, and you can deduct the deferred income from revenue. Annual cost to taxpayers: $2 billion.
* The greed loophole. Money spent on wages and salaries are deducted from corporate revenues, and is not taxable. For top executives, however, U.S. tax rules impose a limit: corporations cannot deduct salaries and compensation that is more than "reasonable." An effort to define reasonable as $1 million has been entirely circumvented -- and corporations can, in effect, deduct whatever they pay CEOs. Annual cost to taxpayers: $5.2 billion.
* The double-standard loophole. Stock options -- the right to buy stock at a preset value, at a later date -- are now a huge component of executive pay. For their internal accounting, corporations value stock options using the value of the stock on the date of the option grant. For tax purposes, however, they can deduct the generally much higher value of the stock on the date the options are exercised. In other words, they can deduct more than they list as their expense. Annual cost to taxpayers: $10 billion.
Not long ago, it was possible to argue that executive pay was an important but symbolic issue. But then it became clear that ever-escalating executive pay is creating a culture of greed that is fueling income and wealth inequality. And now it has become clear that executive pay schemes are contributing to corporate practices harmful not only to workers, consumers, communities and the environment, but to corporations themselves, and even to the functioning of the economy.
The foolish and inexcusable housing-related investments by Wall Street firms, Fannie Mae and Freddie Mac resulted in no small part from executive compensation-driven efforts to drive up short-term stock values. These decisions were so bad, and of such enormous scale, that they have endangered the functioning of the financial system itself, thereby necessitating government intervention and massive taxpayer expenses -- an indirect but even more expensive taxpayer subsidy for executive compensation.
A "market economy" indeed.
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60 Comments so far
Show AllJust today I heard that the Fannie Mae/Freddie Mac bailout doubles the US national debt. That's the debt not the anual deficit. This is astounding.
It would be more astounding if it were true, but not so astounding since it is not. I think the two hold about 5 trillion of mortgages, but they are not such low quality mortgages as to be worthless. I hear that it is unlikely to cost the taxpayers more than 200 billion to get cleaned up (to mortgages that are getting paid on time and in full), and maybe cost nothing.
200 billion here, 200 billion there, and soon you are talking about real money.
Joe
… like the 2.3 trillion$ that DOD admited is "lost" on 10-Sept-2001.
What a convenient day to enable people to lose track of reality !
Namaste
Its only tax dollars. Its not like its real money or anything.
-- ekaton --
… it's not what you make,
__ but what you keep
__ that matters
Namaste
Any arguments for such bloated excessive compensation and the tax codes which allow it are tripe. As terrible as those annual tax losses are, they represent 4 months of Iraq occupation funding. So even if those aggregious loopholes were closed, in 120 days the US taxpayer would see the savings thrown down the black hole in Iraq. And that monumental waste has been going on for 7½ years - 90 months at about $10 billion a month! Bush has effectively let 9/11 economically destroy the USA. Of course, that's only for us peons. CEOs and the rest of the MIC rich filth are doing fine.
wcdevins at 1:57pm, Very good statement, perceptive and concise.
How few fellow citizens are aware of this ongoing destruction of the US economy;
it's just beginning to impact most of us, so few have bothered to care.
Most keep shouting, "USA! USA!" as if that's a remedy.
THose who can do. those who can't, teach> THose who cna do neither, Manage.
There is no excuse for this looting of the Corporations by their officers, the looting of the workers wages, retirement benefits, even jobs that they are stealing in the name of "globalization"
A term for Corporate greed nothing else. Its the same as making a claim that there is a "citizen of the world" Both these claims serve Corporate greed and are used to disguise the wealth transfer now in effect.
The same jobs done by Corporate officers and CEO's in other countries don't come within a country mile of the compensation paid to Americans doing the same job. If a Corporate CFO from the 50's or 60's were transported to the present time they would call the police.
Once again the failure of oversight by our government....or the purchase of no oversight.
Market economy my a$$. It all comes down to corporate governance, and the Republican-appointed SEC commissioner (as well as the predecessor appointed by Mr. Bill) drowned shareholder rights initiatives. This allowed corporate managers to load the board of directors with cronies, keeping shareholder representatives off the board. This allowed CEO's to load up on salary and perks. The current corporate governance system is ANTI-DEMOCRATIC, and serves to protect the interests of executives--the big contributors to the GOP and DLC wing of the Democratic party. Don't look for Obama to change this.
The reason for deregulation was started by Phil Gramm, and passed by a Republican congress/Sentate. This has let Hedge fund managers become billionaires, while the Hedge fund itself sinks. UBS, once a solid Swiss bank is deep involved in the Mess, and maybe losing billiions this year, following Lehman Brothers. Which in turn is looking like following Bear Stearns.
The CEO of UBS till three months ago? Phil Gramm.
Who just took a 30 Milllion dollar golder parachute to resign from the bank.
Love
Zero
If a deal for Lehman Bothers is not worked out over the weekend, the bailout of the GSE's may in the end prove somewhat irrelevant.
My bet is with so much at stake, some deal will be hammered out. But if not,it could 1929 all over again come Monday..
Nouriel Roubini-
"It is now clear that we are again – as we were in mid- March at the time of the Bear Stearns collapse – an epsilon away from a generalized run on most of the shadow banking system, especially the other major independent broker dealers (Lehman, Merrill Lynch, Morgan Stanley, Goldman Sachs). If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer."
Support flat tax on gross revenue for corporations. It's the only way to keep Congress from providing loophole after loophole which, as the author points out, result in gov't regulation skewing the market. I'd add that the decrease in capital gains tax and dividend skewed the market toward investing in stocks, rather than the safer CD route. All income should be taxed the same. No deductions or "breaks" for anything.
The most important aspect of widening gulf pay and wealth is not the money itself but the equation
wealth = power.
The US has a distribution of income and wealth more extreme than any other industrialized country. The distribution is more extreme than it's been since the 1920s, 80 long years ago.
The US is less and less a democracy and more and more an oligarchy run by the rich for the benefit of the rich. Laws are written to provide socialism to the capitalists and capitalism for the rest of us. Laws are written to turn more and more hard-working Americans into debt peons, chained to homes, jobs and credit cards, while the government bails out Wall Street billionaires down to the last taxpayer-provided cent.
If this widening gap in income and wealth is not reversed, the average American will have more in common with a medieval peasant or Russian serf than the proud, independent people we once were.
Given the nature of men and plenty of historical precedence, how could the invisible hand and laissez-faire ever been considered anything more than idealistic theoretical nonsense?
How could trickle-down and supply-side ever been argued as sustainable strategies? And not properly equated with the inevitable servitude of common good to wealthy private interest?
How could arguments for deregulation and less government ever displace the absolute need for social accountability, the responsibility for promoting the common welfare, for assuring opportunity and accessibility for all?
Why is inefficiency in government allowed to become argument for less government instead of for better government? Especially when so many claiming to promote that cause coincidentally promote military spending and bloating of the national debt well beyond the extent of any so-called tax and spend efforts they criticize?
Why has it become so easy to dismiss providing necessary and vital social programs as liberal tax and spend evils? Why is private profit considered better than social equity? Why has it become so difficult to champion for just and efficient government oversight versus the impossible debate of more or less government, more or less regulation?
What happened to the realization that government must exist not merely to protect us from outside forces, but to first and foremost promote fairness, to give an equal voice and power to every person and just cause, and to not allow those with the greater power to run roughshod over the weak? What happened to the natural understanding for checks and balances, not just of power in government but as an overarching doctrine for assuring fairness and equality and preventing corruption?
What of posterity?
All good points. But when are we going to elect someone that admits that unregulated, globalized capitalism is a farce amd creates peasanthood? (And kills peasants)
My view is that there is a distinct causal relationship between what folks seek or expect, and then what they get as a result. (unwittingly or not - ignorance is no excuse)
So, for as long as the vast majority of folks think within the same old-styled systems of wealth and power, for themselves, our institutions and of government, they will keep getting more of the same.
It is not enough to think about electing a third party candidate, to seek an end to an unjust war, to want green sustainable practices, or in this case to seek punishment against corrupt and greedy capitalists. Simply put, how can you punish a person for doing exactly what the system rewards, which is is self-absorption, self-aggrandizement and self-importance?
When more folks understand the deeper underpinnings of our economic and political (man-king styled) system, then perhaps, and only then will they seek a more equitable promotion of the common good, to better practice the pursuit of real happiness and bless posterity for all. But, as long as it is about me, what's in it for me, mine is better than yours, and the only thing that matters is me and mine, then we are inevitably seeking exactly what we are getting. And we cannot fault those who do it better, regardless of how fair or unfair it might seem or how just or unjust their actions - their end will always justify their means.
Until then, let us keep promoting the discussion!
Give Me Liberty
"tax purposes, however, they can deduct the generally much higher value of the stock on the date the options are exercised. In other words, they can deduct more than they list as their expense."
This is not completely true. I'm a tax manager for a largish corp. and the deduction is the realized gain on disqualifying dispositions, ie the difference between market price at the day of exercise and the price of the option for those where the employee hasn't held the shares for the requisite time. THe amount we deduct is FAR lower than the expense on the books, which is non-deductible. Now, the numbers could work out much more beneficially for other industries and other companies (and probably do).
Also, we are not able to deduct the portion of exec. salaries over $1million. I am not familiar with any rule that allows that. We've got pretty good external tax consultants who agree.
Having said that, this being CD, I should also add that our EFFECTIVE tax rate (what the corp. actually ends up paying in taxes as a % of Net Income) is about 20%. That's on hundreds of millions of dollars of profits.
No gods, no kings
U N B R I D L E D __ A V A R I C I O U S N E S S
___ " there's going to be hell to pay " ___
Once awoken, the American people will be quick to act
___ those with the golden parachutes
___ will SINK very quickly
___ ( in the bu$h!t of their falsified dreams )
Namaste
I wish. Since when have the Am. people EVER made rich people "pay hell"--HELL they wont even make them PAY taxes!!
WISHING and outright unbridled deep seated wanting for CHANGE
__ is a GOOD THING
__ GIVE it a GO
Namaste
"These decisions were so bad, and of such enormous scale, that they have endangered the functioning of the financial system itself, thereby necessitating government intervention and massive taxpayer expenses..."
That is not true - government intervention was neither necessary nor correct. In a "free market," if you screw up, you fail, and if you are guilty of stealing, you go to jail. If this simple rule was followed by "friends of the Fed family," (as it is by the rest of us,) then corporations would willingly do their best and be on their best behavior, because nobody wants to loose everything and do hard time.
In other words, think pro sports: the best and wealthiest teams play by the same rules as the worst, poorest teams. There is no offsides loophole for the team who bought the Ref a new car.
Instead, said Fed family friends are encouraged to lie, cheat and steal, because they know they'll face no consequences and they'll also get to keep the booty.
The "financial system" will never collapse - that's just yet another effort to create fear and then play the savior. Works every time, including this time...
This "level playing field" BS breaks down when yu have people born multi-millionaires. So, Dubya just "worked his way up" to Yale and the presidency...sure..I cant even imagine what they do with such money! If we had a true level field, Bush, Rummy, Cheney--all of them would fall off the edge. Rich people will never let that happen to their genetically inferior brats.
Yeah the Chicago Skool basterds did so much for Chile'--that must be why South America/Cemtral Americas love us so much. Thanks, Yankee!
Amen
Why is the middle class disappearing? Are poor people just to die, is it "god's will"? If it is dog eat dog, maybe someone wil shoot you, and no amount of money will save your capitalist ass.
There's always physical force, eh? Atomic bombas? All hail the fucking capitalist state!!
If socialism is based on social thoery, is capitalism not just "moneyism"?
The market is not "free". The market is RIGGED. If the market were truly free, employees would have just as much say as stockholders.
Part of the issue is that the truth of REAL life-cycle costs
___ are not being evaluated as part of the "GNP" ( … etc ) metrics
___ that drive the FOOL-ship of corpoRAPE America.
If those corporate salaries were NEGATIVELY tied to environmental impacts ( instead of being RIGGED the other way, as you say ), the results would be a 180 degree turn.
A simple feedback system, based upon the proper "signals" will make the system self-correcting.
It is the RIGGED aspects of the not "free" market, that skew so much in such wrong directions -- which actually IS driving the American & Global systems to greater and greater abuses and inhumanities.
This is actually STILL self correcting in its own manner, over the long haul, we just have to wait for MORE of the people to be further dragged into the MUCK.
Namaste
enliven,
Thank you. You framed it very well. I would love to take what you wrote and force my pols to learn this truth. I think I'll have to hit their fucking heads with my baton first.
Off with their heads.
-- EKATON --
Here's a way to reign in obscenely excessive executive pay: OUTSOURCE THE CEOs, CFOs, VPs positions, etc to INDIA! They would probably outperform their American counterparts for a fraction ($500,000/year?) of their salaries + 0 perks/bonuses.
If they perform well, they get to keep their job!!!!
On the one hand I earnestly hope the day of reckoning comes soon, even if it will be prolonged. On the other, it will be us poor, all over the world who will, as usual suffer most, and most horribly; and I really don't wish that on us. But sometimes I get so damn mad at the coninuing outrages that are now coming on a several-times daily basis that I wish the utmost terrible would happen- say a nuclear strike with the NYSE as ground zero! A friend once told me that the reason so many smart people have depresssion is because they can see the way the world really is, and is really going, yet know they can do nothing about it. Think about that next time someone in government or off Wall Street says that the economy is fundamentally sound, or we are winning the war...
"a nuclear strike with the NYSE as ground zero"
Um, I think somebody already kinda tried that...
How about we just get rid of stocks? Do they actually fulfill their function of providing funds for a corporation to expand its production? Why not just let corporations rely on banks like everyone else? At the very least, it would defund these gigantic corporate paychecks.
"How about we just get rid of stocks?"
Um, no thank you. I like to have the choice of owning equity in companies.
"Do they actually fulfill their function of providing funds for a corporation to expand its production? "
Yes, they do just that, or those funds could be used in many other ways.
"Why not just let corporations rely on banks like everyone else?"
"Everyone else" already can and do sell an equity position in their small business.
" At the very least, it would defund these gigantic corporate paychecks."
No, absent compensation via stocks as mandated by an oppressive government, they would simply shift the focus to salary, and would still get odscenely high compensation if the market supported it.
Um..we could REGULATE it--theyve shown that they wont do it. Do you remember what REGULATION is? Especially , if, when they default , the people have to pick up the pieces and they go off to buy a manmade island in Dubai!
"we could REGULATE it"
We do. The Securities and Exchange Commission is a regulating body of the federal government and is already in place. I would be interested in specific changes you would propose from the existing regulations therein.
I see no positive use for stocks. If CEOS had to borrow it from banks (give them a subprime loan--haha!)they might make different busines decisions. But, not as long as they have the Republicrats to bail them out.
"I see no positive use for stocks."
Stocks provide liquidity for companies. You may see no value but companies and investors do.
"If CEOS had to borrow it from banks "
The CEO doesn't do it, the company does it. And they often do just that, that is, borrow from banks.
Executives are just people who work at a company. When people think of evil companies, they personify that with the image of the big fat rich executive. That's not really correct. A company like Haliburton, say, is widely held by many individuals and institutions. In fact, much of the equity in that company may be earmarked for regular people's retirements.
It makes me so happy! I LOVE IT, that America is finally go belly up, and the Point of no turning back is approaching. I say "keep it up"! I've been investing in lots of rope. I will have alot of hanging to do for the People. Hey, someone has to do the job.
Coffeelover,,,,,,
It might be better to see the United States default on its debt.
On one side there's a lot of money, and on the other side there's a little chatter on the internet.
Nobody is listening.
Jacob Freeze
The tradition of salary secrecy is something that does not serve us well.
The secrecy surrounding pay is part of what allows discrimination and inequality to persist in the workplace. Unions or unionization movements should have access to the pay scales of executives and managers. The execs and managers know what the employees make, so why should privacy be a one way street?
The execs and boards have a royalist mentality in which they take care of each other, regardless of what is happening to the enterprise, the community or the employees. In the absence of any challenges from organized labor or government, this situation has gotten worse and worse, with exec salaries looting companies with no regard to the consequences.
And then the average taxpayer is asked to bail out the company. Why? Did Lehman Brothers execs ever give me anything when they were raking it in. Free market never applies when the rich fail. Some of their excessive salaries should be siezed to make things right.
Joe
Just before the last Delphi Plant (NOT where user name comes from-never there)went bankrupt here, the CEO was revealed to be making a salary of $10million with stock options , bonuses, pension, etc. of $35million. They were asking the shift workers to "take a pay cut". The Union suggested that the pay cuts be "across the board". (They were also asking many 35-40 year workers to settle for 1/3 of their pensions and reasign)The CEO spoke to local news, saying, "I'm giong tto ignore that suggestion. I know you are angry and striking out everywhre, and cant possibly mean it!". (!!!!!!!!!!!!) The media, looked down , sheepishly, and commentators sighed and guffawed, "Well, he does have a right to make a living too, I guess." (!!!!!!!!!) I wrote letter to the editor, and was accused (by mail--almost no returns)of being "communist" (a compliment compared to a capitalist), anti-capitalist (damn straight), and people saying that "union workers are so greedy, that is wh the uS is losing jobs". THAT, my egalitarian friends, is what is wrong with the US. Of course, the gutless, spinless union backed down.
THE POPULIST PARTY
Wealth belongs to him that creates it,
and every dollar taken from industry without
an equivalent, is robbery. “If they will
not work, neither shall they eat.” The interests
of rural and civic labor are the same; their
enemies are identical.
– Preamble, first part platform, 1892 Ibid., plank 2
THE POPULIST PARTY
The newspapers are largely subsidized or muzzled, public opinion silenced, business prostrated, homes covered with mortgages, labor impoverished, and the land concentrating in the hands of capitalists. The urban workmen are denied the right to organize for self-protection, imported pauperized labor beats down their wages, a hireling standing army, unrecognized by our laws, is established to shoot them down, and they are rapidly degenerating…
-Preamble, first party platform 1892
Heads, you lose; tails, you lose.
That is the largest problem we have in America.
On this last Friday's Bill Moyer's Journal program, Moyers closes a segment with this observation:
Speaking of good journalism, check out the front page story in the NEW YORK TIMES by Jackie Calmes. We'll post it on our website at pbs.org. Calmes joined the TIMES after 18 years at the WALL STREET JOURNAL covering politics, economics and public policy.
In the TIMES this week, she tells an important back story to the government's takeover of the mortgage banks Fannie Mae and Freddie Mac. This is a move that could drive up the national debt by as much as $200 billion. To come up with the cash, the Bush Administration is reaching deep into your and your kids' pockets. With the help of the Center for Responsive Politics, Jackie Calmes came up with facts to help us try to understand how, over so many years, such wild mismanagement of both corporations was allowed to happen. Why weren't the watchdogs barking? Where were the people's representatives? The answer? Follow the money.
Both Barack Obama and John McCain say the Fannie and Freddie mess is the result of the cozy ties between lobbyists and politicians, the very thing they will "change" if elected. But guess what? Neither one of them has ever had, quote, "A record of directly challenging the companies."
To the contrary, Obama is second among members of Congress in donations from Fannie Mae and Freddie Mac's employees and political action committees, even though he's only been in the Senate since 2005. The former chairman of Fannie Mae originally led Obama's vice presidential search committee but had to step down in a controversy over favorable loans he received, while at Fannie, from a company doing business with Fannie.
Among Obama's contributors are three directors and one senior vice president of the two companies. Furthermore, Obama's fellow Democrats in Congress have long been enablers of both corporations.
And what about John McCain? His entire campaign team stepped right out of a predator's ball. His confidante and top adviser lobbied several years for Freddie Mac. His deputy fundraiser lobbied Fannie Mae, and his campaign manager lobbied for both of them, leading a coalition of beltway insiders whose goal was to "stave off regulations" that might have short circuited this nightmare.
One wealthy member of Freddie Mac's board has contributed more than $70,000 to McCain and Republican Party members working for McCain's election.
Even the guy who vetted John McCain's vice presidential options is a former lobbyist for Fannie Mae.
This week, both Obama and McCain are speaking up for taxpayers, like you and me, who have to foot the bill. But locking the beltway barn door after the horse is gone leaves the stable smelling like you know what.
Now, Senator Obama denounces "golden parachutes" for the deposed execs of the two institutions. Now, John McCain blames Fannie Mae and Freddie Mac's troubles on "cronyism" and "special interest lobbyists." Beg pardon? Does McCain know that if he really intends to throw the bums out he'll have to start with his own inner circle. As we've heard, you can rewrite the myth but you can't rewrite the facts.
And that's it for the JOURNAL. Remember, read Jackie Calmes' story on our website at pbs.org. And we'll also link you to the Center for Responsive Politics and some more delicious treats on the money trail.
I'm Bill Moyers, goodnight.
Link: http://www.pbs.org/moyers/journal/09122008/watch2.html
Thanks. Saw it. It was good. (I was afraid he was going a little soft lately) If you didnt see or dvr it, its worth going to the link.
"First, there is no plausible market-based story why executive pay should have been bid up so much over the past quarter century. Are executives working harder now? Making better decisions? Has the CEO supply and demand equation changed?"
Well, the author doesn't offer any answers to the three questions, so without that the first sentence is unsupported.
"Second, executive pay is not set by the market, but by boards of directors, "
That's just nonsense, boards are buyers of a service in the market place, executive candidates are sellers.
I think the best argument that it's not market based would be around Interlocking Directorates, but no mention of them.
What's the big deal anyway? If you don't like it, don't buy stock in companies with big executive compensation.
I would think it woudl be obvious! The problem with it is, that they wil never have a motivation for changing the system, and , if things get roughhey wil go to one of their houses in Dubai, Monaco, etc.
The prob. with it is, that the middle class is disappearing (thesepeople did NOT make their money through "hard work"--their companies are failing right and left)and we have the greatest inequality among classes , since the 1920s and in the Western world.
Thew prob. is that they invest in immoral works, like denying people health care and in privitized war. In short, they invest in death.
The prob. is that they are wiling to SELL almostANYTHING TO anyone--even our "non-allie" and thegovt doesnt bat an eyelash. But, if a middle class Am. muslim gives a charity--he endsup in a black site! (Sponsored by your friendly capitalists).
The prob is, that, there are almost no companies that you can buy stock in that do not have huge CEO compensation. Its a good ole boys game, and, if they dont give it up legally, I think the people wil have had enough , and they wil take it from them. By wha moeral code dose one collect 100s of millions of dollars (prob Euros now) to buy a golden toilet seat , to bankrupt a companey, while peopl lie dying in the streets due to these assholes mortgage fraud investments in Hedge Funds.
There is simply no justification for it, and the entire planet knows it.