I just read the latest news that the Obama administration is instituting a 90% pay reduction for the top 25 employees at all the companies that were provided bailout money.
The idea is that voters are irritated at the idea that these executives are making a lot of money and getting paid with tax payer dollars.
While this may the politically acceptable solution to bad publicity, it’s a pretty dumb move.
Let me ask you, if you’re really good at what you do for work and your “boss” gave you a 90% pay cut, what would you do?
Duh… I’d quit.
Now think about who in the world would be dumb enough to want a top 25 job at say a major bank that’s really in terrible financial shape?
You’re assigned “mission impossible” and you get paid pretty nothing.
The only kind of person who takes this kind of job is one who has no other choice. You can be sure it’s not someone who’s really good at what they do.
This seems like a pretty lousy way to protect the government’s investment in these banks. Yes, lets give someone $100 billion in bailout money, and then find the least qualified person to manage it.
I generally don’t talk all that much about politics. But, this was such an short-sighted decision that it’s absurd to anyone with any business sense.