Obama caps pay at half-mil for executives

by YES! Staff

When President Obama last week made a move to cap CEO pay at $500,000, he ruffled many wellgroomed feathers in the world’s best-compensated job. Half a million dollars, to a corporate senior executive, is not a lot of money these days. CEOs of S&P 500 companies made on average $14.2 million in total compensation last year, much of it in cash bonuses. It’s a way of life for these folks, whose salaries are roughly 300 times larger than the average US household income. And when you’re used to getting an annual cash bonus of, say, $15 million, like John Thain, CEO of Merrill Lynch did in 2007, a half a mil doesn’t even put gas in the jet. Of note are the facts that Thain’s total compensation for 2007 was more than $83 million; he didn’t start the CEO job until November of that year; and before he resigned in January 2008, Merrill was absorbed by Bank of America after losing billions and facing insolvency. That is a pretty sweet job. And normally, if a company wants to squander its resources on exorbitant executive pay, that is between it and its shareholders. Let’s get something straight: In a capitalist democracy, how much money you make is none of the government’s damn business — unless, of course, the government is paying your way. And that’s what our nation’s CEOs are having such a hard time swallowing: They are using the public dime for operating capital, which means they work for us. As it stands, the corporate entities that are digging in to that sweet, sweet federal bailout pie enjoy similar status to people on welfare: They are wards of the state. And as such, you’d think $500,000 would look pretty good to them. But therein lies the problem. It would take most Americans a decade to earn $500,000. But corporate CEOs operate in a different financial universe than the rest of us. While many Americans struggled to put gas in their cars and pay their mortgages, Wall Street firms last year paid out more than $18 billion in executive bonuses last year. And let’s face it: It was not a very good year. But the people this will affect most — the CEOs themselves — are some of the most powerful people in the world and we don’t expect them to take this lying down. Half a million dollars isn’t even “real money” to these folks. The spin, of course, will be to make this a visceral issue, a matter of keeping the government’s hands off business in an appeal to the tenets of capitalism as opposed to a matter of unfettered greed. And it is probable that many Americans will take the bait, even those making considerably less than 1 percent of John Thain’s 2007 total income — which would be $830,000.

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In a capitalist democracy, how much money you make is none of thegovernment’s damn business — unless, of course, the government ispaying your way.