The Executive Pay Slippery Slope

The Provocateur ^ | 10/23/2009 | Mike Volpe

[fiscon1]

Yesterday, the White House pay czar, Ken Feinberg, did his round of interviews to explain the massive cuts in executive pay for bailed out firms.

The Washington pay czar who's ordered steep pay cuts for executives at bailed-out firms could have practically unlimited power to regulate compensation at any company that gets federal funding, lawyers say -- even if his legal authority is sketchy.

The move raises questions about whether the mandate will be limited to the seven firms Kenneth Feinberg is currently targeting -- and whether it could trickle down to smaller companies.

"He has a lot of authority with respect to not just the seven but with respect to all TARP firms," said Stephen Bainbridge, law professor at UCLA. "It's an enormous expansion of federal power over corporations."

[tired1]

Screw a whore - risk VD.

[NTHockey]

He has ZERO authority - if only someone has the cojones to tell him to pack sand. Where does it end, if these seven fold? So the top 25 get a 90% cut; that just creates a new top 25. If they get 90% cuts, there is a new top 25. Ultimately, everyone is making minimum wage; living off food stamps and welfare while the states lose out on tax revenues.

Wht a plan! Only single digit minds - popularity AND IQ - could come up with that.

[ravingnutter]

I told my mother last night when she was cheering this move that it would be a disaster. First of all, if you cut their pay, they are just going to go elsewhere and you are not going to find anyone to do the job at the lower rate, therefore the company flails and fails...which it should have been allowed to do in the first place, but now that we have a vested interest due to Obama's meddling, I believe we, the taxpayers need to eventually be repaid.

The best option, IMHO, is to fire the underperforming CEOs and put someone in there at a new negotiated rate of pay that will turn the company back around, that is how things normally work in the real world. When the company starts realizing a profit under the new management, then we, the taxpayers, get reimbursed.

Besides, the author is correct, this is a very slippery slope we don't want to go down because as with all plans from the FedGov, it will be expanded incrementally until we are all enslaved.

[vigilo]

“...it will be expanded incrementally until we are all enslaved.”

That’s the plan and the goal. All wages will be set by Federal Law in the name of fairness, justice and equality. It’s utopianism.