Serious Studies

Hard Times on Half a Million

Gordon Gekko

Oh, the whining over fine dining that's been heard in the all-but empty bistros of Manhattan as the last expense account executives cut into their exquisitely tender veal and complain about the Obama salary cap!

Sure, a limit on comp will change the make-up of the individuals who surface for the top slots in banking and industry. And that's a bad thing why? If a company needs a bailout -- hey, let's call it what it is: a handout -- shouldn't it come with certain strings attached? Son, if you want this money for college, you're not going to be spending it on a car. Right? Only a wayward teen would expect otherwise.

Is $500,000 base, with a bonus to be decided upon performance, an unrealistic sum? It seems so to people accustomed to the good life that was promised to them in business school and the lucre they accumulated during the boom. But where does it fall in the vast scheme of things?

A little review of the facts yields some perspective. The numbers seem kind of unbelievable to me, but then I live in a variety of charming urban areas where a dinner for two that comes in under $100 is considered an eyepopping steal.

Median base salaries:

Elementary School Teacher: $49,979

Physician: $147,480

Manager: $128,540

Attorney: $88,944 (who are these guys?)

Architect: $56,637

Registered Nurse: $61, 603

Now granted, these are median salaries. The 75th percentile of these jobs, which are arguably every bit as important in our social scheme as that of Banker, are about 20% higher than the median in each case. And of course there are those at the top of their professions that make a lot more. But this gives you some notion of what a base of $500,000 means to just about everybody but a Banker.

I have an idea. How about we open the top slots at failing fiduciary institutions to Teachers, Architects and Registered Nurses? Let's leave attorneys out of it. They're already in there somewhere making hay while the the sun don't shine, I bet.

83 Comments Add Comment

I'm sure you'll get numerous comments complaining about the poor execs making sacrifices to live 10 times better than teachers do. I think the huge benefit of the salary cap approach is to align the CEO motivations with the tax payers by not letting them cash out until the government gets paid back. In reality, that is probably the closest thing that's been done in a long time to align their motivations with the shareholders too, it's just a culture that would never change in the direction of greater burden on CEOs without someone as powerful as Uncle Sam to put their foot down. Why don't all companies adopt this approach regardless of bailout?

To be far you should only consider the pay for the top of those jobs as that is what you are talking about for the execs

Bing, what evil and harmful things did any attorney do to you to provoke the sarcasm, badwill, and personal attacks? Do you really not believe that physicians and managers earn more than attorneys, and do you really believe that attorneys are secretly benefitting from all others' economic misfortunes? Or is it just easier to take the more popular low road by writing within the context of attorney bashing? Maybe I'm missing this as just part of your "sharp" sense of humor for which your works are apparently noted.

Goodness, JJ, I'm sorry! Jeez! If a guy can't make a lawyer joke every now and then what's the world coming to? Even Shakespeare made them! A lot of them! Next time I'll go after somebody else, okay? I love my lawyer! Really!

The investment houses and bankers claim that these huge bonuses must be given or they risk "losing their talent" to other companies. What talent? If these guys were so talented, why would they have experiened tremendous losses? They were extremely short sighted, or simply crooks. Mortgage-backed securities depended on two factors always being in place: a residential realty market constantly rising, and the homeowner, once their mortgage adjusted upward, always being able to make the payment.
If you cannot live on 0.5 million per year, even in expensive New York City area and supporting a familiy, you are just a bad a manager of your personal life & fiances.

Thanks for shedding a light on how things really are. The folks who demand these huge paydays and so far removed from reality it is crazy. They need to walk in our shoes for awhile.

Bing, being a lawyer I am hoping that bankers replace lawyers as the butt of all the jokes and the easy target of society's enmity. I love a good lawyer joke but have we not been surpassed in sheer greed, arrogance, etc., by the bankers?

As one who for months has been scraping his median base salary off the bottom of his shoe with a flat stick, I am almost in awe of even a teacher's annual income.

The job title Attorney is a bit misleading in this case, though. You would expect that salary to be higher, but then you'd be thinking corporate attorneys or some other high-flying, triple-billing each hour sort of mumbo-jumboist.

I think the job description that fits that salary range is Lawyer and not Attorney. Specifically, they are that lovable category of Street Lawyer. The guys who open up a little storefront and take walk-in appointments.

In fact, after expenses I don't think they make even as much as the $89K listed. These are the guys in the trenches, taking care of the common man's bankruptcy filings, divorce proceedings and personal accident lawsuits.

As I say, they are a gregarious, innovative and lovable... well, tolerable... bunch. I hired one many years ago. And it was one of those most memorable and enjoyable moments in life when I later told him that he was fired.

To cheer yourself up, hire one and then fire them the next day. It will put a lilt in your walk and a whistle on your lips.

It's a great feeling, second only to kicking a banker in the shins.

I'm sorry, too, JJ. If it makes you feel any better, I am a Consultant. You can find plenty of joke fodder in that job title, too.

Relax, Bing. JJ has apparently not yet grown the thick skin that is necessary for one to actually practice law. Every well-adjusted lawyer I know realizes that lawyer jokes can be pretty funny, and there's often a rather large grain of truth to them.

On another note, I just looked at the Chronicle of Higher Education and saw an article about "Salary Cap for Bailout Recipients Fires Up Critics of College Presidents' Pay". Given the amount of government money that goes into higher education, and the paltry return on that investment, it may be way past time when college presidents are limited to half a mil. also.

What is wrong with a CEO making only 5x the lowest pay in the plant? It worked for Ben & Jerry until Unilever bought them.

Yeah, but those guys owned the company, didn't they? Didn't they get a little taste off every pint? And in the end, didn't they scoop up a wad when the company was sold? I don't think there's anybody who wouldn't take $1 as a salary, if it went along with 1% of their company's revenue.

Bing,

What's her name?

For some, the Gordon Gecko mantra that "Greed is good." has always been more than great film line.

It's been a reason for being.

An observation only, not a value judgment.

Here's the problem with your idea, Bing. I know because I'm married to a teacher who works at a private school and whose salary is (are you ready?)...less than 1/3 of the median amount you posted.

People in those professions are in those professions for a reason.

They actually contribute something to the world in which we live.

I think we need moms who can really pinch a penny to run these failing companies. You know stay at home moms with like 2-8+ kids on a middle income budget.

It needs mom to whip things into shape!!!!!!! Remember that old saying that if Mom isn't happy nobody is happy. Can you imagine the memos that would get sent out?

You want to decorate your office then you best do it with stuff from the second hand store or at least from Wal-Mart/Target (And it better be on sale too)!

It's a nice idea bing but the players union will never go for it.

Let's find other professions we don't like and let the government limit their compensation too! Given this column, I'm pretty certain Bing makes "too much."

Tammy Wynette sang about where a big chunk of my money goes.

Steve, who said I was an attorney? I'm just as likely to be a high level executive at a major national broadcast network who writes columns for a couple of magazines! Bing, do you have any jokes aimed at those types? (*wondering what their median income is . . .*)

Horse walks into a network budget meeting. CFO says, "Why the long face?"

To Peter Hebda,

Your brush is a little too broad...yes, there absolutely are exectutives, individuals, teams and even whole divisions at these companies that were involved in the decisions that have led us to this point and deserve to be fired, reprimanded or have their compensation limited. However, there are plenty of other individuals who work in other areas within the same firm that weren't in any way involved in those businesses or decisions. They continue to do their jobs and are helping provide what little bit of cash flow is left. If we allow the govt to intentionally penalize these other employees at the same time, they'll simply leave. There is still a market out there for top talent, and it's well above the pay restriction. Believe it or not, it's not about whether or not someone "can" live on $500,000. It's do they have to. In other words, they'll leave for another firm that will pay to hire "top quality" talent. Then they will sit back and make even more money stealing business away from the bank the taxpayers now own. The taxpayer owned bank will eventually be run by people with less experience who are willing to stay for less money. So in that sense, the govt is screwing the taxpayers by running off the remaining quality employees and potentially leaving a bunch of inexperienced unqualified operators running the ship...but that sounds like a govt operation, doesn't it? Be careful what you wish for!

If a mogul is paid 200 dollars an hour and he earns 200 hundred dollars or more; pay him what he's worth!

If a mogul is paid 200 dollars an hour and he earns 15 dollars an hour; please, pay him what he's worth!

Hi Bing, I'm an alien from a distant galaxy called The Developing World. Your top execs have just discovered something called Middle Class America, where people scrape by on $150,000 a year. Maybe one day Middle Class America will discover my home planet - Africa. I've got three degrees, I'm a minor celeb in South African media circles, I've published three novels including a local bestseller, I write movies and TV stuff, and I get more work than I can take on. My earnings in 2008? $40,000. And I'm living LARGE. And my compatriots, who eat three square meals a day, drive their kids to school in Toyotas, go to church or mosque and have a barbecue every weekend? They're pulling in about $15,000 a year. Let's not talk about all those who live on about $5,000 a year: wouldn't want your readers to feel icky. But one day your gaudy but entertaining species will adapt, as it has done so many times, and will start living like the rest of us. Hakuna matata, Bing.

Personally, I love the "talent retention" argument--I'd rather NOT retain the "talent" that ruined so many companies, personally...Or at least, I'd want to align their incentives with what is good for the company (and, when government handouts are involved, with what's good for society). It's about time someone called the "executive club" out for enriching themselves and their friends while screwing over the rest of the country (and, let's face it, the rest of the world). It's a great racket, I'll admit, but that kind of "talent" is not worth retaining. Hopefully their gravy train will be reaching the terminal fairly soon now, so that more people will be enticed into actually creating value for society rather than coming up with ever more creative ways to skim off the top (and to convince everyone that you're "creating value").

I am a president of a company, times are tough, I work for free right now while paying my employees reduced wages. I am a millionaire from taking risk, my employees don't take risks and are not millionaires and will only be if i steer this ship the right way. There is a time and place for big risks to equal big rewards. In banking in America, there is probably more career risk than ever before for executives. Incentives should continue to be huge for the captains of the ships. This model is what built America.

Senator Susan Collins states the stimulas debate is nearly over; the key issue is education?

If students are so adept in learning to navigate all the cyber products out there; then, why can't they persue education?

The two edged sword will be put back in the scabbard: "you can lead a horse to water, but you can't make him drink".

Students who desire am education can prosper; while those who are less desiress can play computer games.

Unbelievable,

How can anyone survive on $500,000.

Give me $500,000 and I would retire right now.

Two simple rules of thumb for ensuring your own wealth:

1. Get as close to other peoples' money as possible.

2. Be in the room when the decisions are being made.

Given this, the bankers will always come out on top. Expecting anything besides brief interruptions in this formula seems as futile as getting angry at the ocean.

Annual per capital income (PPP) according to World Bank 2007:

Albania $2,960
Brazil $4,730
Belize $3,650
China $2,010
Iran $3,000
Kazakhstan $3,790
Mexico $7,870
Pakistan $770
Sri Lanka $1,300
Turkey $5,400
Vietnam $690

United States $44,970
World average $7,439

Now granted, these are averages. In countries with dictatorial ruling classes, the average citizen probably lives on far less income than these skewed averages suggest. But this gives you some notion of what the average wage of an American means to just about everybody but an American. How about we open all job slots held by Americans to Indians, Pakistanis, Sri Lankans, Mexicans and Filipinos via outsourcing and global production?

Or let me suggest a not-so-original different plan. Since the rest of the world seems to be suffering just as much as the United States in the current economic malaise, maybe its time to exact some social justice on the greedy American teachers, physicians and architects who have been enjoying the benefits of the sweat of the masses for too long, contributing no real value to the world economy while industrial production has shifted to places like China, Eastern Europe and Mexico. Let's grant a global political body the power to cap salaries of those no-talent Joe Sixpack Americans at $15,000 -- twice the world average! To echo Peter Hebda, if you cannot live on $15,000 per year, even in an expensive country like the United States, you are just a bad a manager of your personal life & fiances.

What a sad situation when class envy rules and "they need to walk in our shoes for awhile" is the common sentiment.

Yields some perspective? Not a chance.

Here is a perspective.
The median banker works 3x as many hours as the median elementary school teacher or nurse and twice as many as the others here.

Bankers are managers too.

Bankers have advanced degrees which compare them only to attorneys and doctors.

Other than doctor the average banker could be employed in all of these positions within two years. The average person listed here could never be a banker.

Physician is to brain surgeon as finacial profesional is to banker.
You're comparing the 50 percentile in other industries to the 99.95 percentile in another.

what about congress,boyh House and Senate, are they not responsible in great part for our current situation. Certainly their latest increase was not for outstanding or even average accomplishment. Maybe we should appoint a committee of average citizens to rate these great public servants and decide how much they should paid.

Propaganda. The compensation restrain will not resolve anything and would not help economy anyway.This propaganda campaign remind me more and more about country I escaped Soviet Union.The demagoguery rising to that level.I hope you will make fun of compensation ideas and President in shame leave it alone.The attorneys can help,spare them .I beg you

Here it comes, any bussiness that gets anything from the government will be told how much they can pay their employees. socialism at it's finest.

Half a mil, invested in something that gets 2% over inflation (TIPS treasuries, for the ultra-paranoid) will give you $1300 a month for the next 50 years. Guess what? You can live on that without much suffering in the other half of the country (my wife and I do). Half a mil, tax-free, and I assure you, neither of us would work a 'job' again.

Salary cap? Nah. Let's go a little simpler. How about we go back to the tax rates from Truman, Eisenhower, and Kennedy? Anyone remember what that top marginal rate was? Bueller? Oh, yeah, 91%. That kind of tax structure encourages an executive to build a stable company that will pay him a healthy six-figure salary for decades, not the kind of retarded game-playing management who paid Carly Fiorina $45 million to leave.

We also believed in moderate protectionism (not Smoot-Hawley, not absolute-free-trade, but the old Whig 'American School').

Funny, those years look pretty damned successful.

Jeff in MN must be joking if you think a Banker works 3x time more hours then a Teacher! Have you ever been a teacher? One of the reasons I left teaching was because I had no social life because of all the grading and lesson planning. It's poor logic like that which got us into this economic mess!!! Let's lend a whole lot of money to people who are more then likely not going to pay it back (subprime). Then to cover this bad logic let's slice and dice the loans so that 1/16 of bad loan A plus 1/16 of bad loan B (etc), into a security fund that we sell to a retirement plan. So a double lose occurs, oh and it gets better. When the house is foreclosed on, because the loan was bound to fail, lets recollect the house and hold on to the house for 5+ year (waiting the value comes back up), there by recking the tax revenue of 38+ states so they can't pay people. I could have created the same mess at half the cost!!!

Salary caps on execs of companies who take tarp funds will merely force those bankers to move to companies that don't take tarp, thereby draining the assests of those tarp banks. (When bankers move,they almost always take their client's assets with them).

#1: Do not blame CEO's for the pay the had or still have. Who authorized their salaries? who authorized their bonuses? I agree that my janitor could have done a better job as CEO of AIG, Citi, Freddie and, even BofA, but somebody signed off on those salaries originally. If you ask, you may receive.

#2: Post those $500,000 jobs on monster.com and I guarantee you there will be 1000's of people will be sending their resumes, there will be at least 10 qualified people,,,,,what is the problem? we have tons of talent around right now.

I'm all for rewarding the risk takers that builtthis country. Where are they when we need them?

The bankers we're talking about here are all about building PERSONAL wealth.

Not with MY money!

"The median banker works 3x as many hours as the median elementary school teacher or nurse and twice as many as the others here"

I'm sorry you're not convincing anyone a banker works harder or longer hours than a nurse. There's a shortage of nurses today. There's not shortage people pretending they know something about finance.

"If I'm financing you, I'm expecting you to obey my orders, if you do not like it, get out of here and look for somebody else willing to finance you"

"If you are not willing to work for what I'm willing to pay, get out and look for that dream job you want"

"My house, my rules"

"This is not a restaurant, eat what I serve you or get up and go to your room"

"This is a free country, slavery was abolished long time ago, you do not have to work here if you do not want to, you are free to go and look for something else"

Are not the above maxims as American as apple pie and hamburgers?

Why not take a look at the pay that government officials receive from our tax dollars? Not to mention the retirement and health plans that anybody else could only dream of. Here in Minnesota, the biggest employer is the State, followed by Federal gov't at #2, whose average salary I saw the other day is at $105,000. Society would benefit more greatly by a cap on pay to anybody who isn't bringing money in, and with a tax cut that would even this out. It would be more beneficial to level that field on a large population than to just limit the salaries of a select few. We need to do something to slow the trend of government employing more and more people. It is completely unsustainable.

The salary cap is way too generous relative to other professionals and to what one needs to have a rather comfortable living. As a Joe shareholder, who bought stocks of Citi, Bank of America, JP Morgan Chase, and Wochovia for over $55 each (Wachovia around $45), I feel cheated by these executives and their buddies who took away tens of millions in fees, commissions and bonus while I am left holding these stocks selling at around $5 per share or worse. I would rather see these people penalized for past mistakes and lootings by taking away some of their assets. Investors confidence is shaken by the lack of trust in these socalled pillars of financial world, and funding these banks is only part of the solution. Some justice through finacial payback may help restore confidence in these managers and institutions and help contain economic recession brought about by financial robbers.

The government places restrictions for those on welfare - these welfare queens should not be any different.

Buffett is the richest human on earth and he is paid $100,000 per year for managing Berkshire Hathaway. His entire fortune came from performance pay. If the executives don't want to work for $500k they can leave. It wouldn't cause the banks to have worse performance because they can't lose more than 100%.

The easiest decision you'll ever make begins with "you/they/he/she should ........" The most difficult starts with "I am ......"

I am enjoying these blogs that do little more than whine about "should, could, would; but never will!

Review the blog histories from the distant past of Aug & Sept were the sentiment was let the banks go bust. Ironic how the closer we got to that point, the less nerve this population actually had to see it through??

JJ:

Why do we like to pick on attorneys? Gee, let me think:
- They will defend any sleazeball to make a buck (meaning ethics are non-existant...sound like today's bankers?)
- They bill by the hour...but wait, they also defend those they know are guilty...so how or why should we trust them?
- Class action suits: let's sue some hotel over some dumb thing that nets the victims ten reward points but provides the lawyers millions
- And my favorite of all: the way you write your diatribe, you actually lawyers SHOULD get paid more than doctors.

As a business owner, I deal with plenty of lawyers. Some are good, but the vast majority seem to hucksters.

Jeff, I disagree with your assessment of both the amount of time other professions spend on their work day. I know plenty of teachers and manager who routinely work long, hard hours. Many teachers work in the summer on projects to make ends meet and nurses work insane hours, attorneys work late hours. It is this level of arrogance that the "financial professionals" have that has led to this problem. I am sure Madoff put in a lot of long hours as well.

Bankers manage money, not people. A completely different skill set and one that is much more difficult.

Many teachers have advanced degrees, many mangers have MBAs, attorneys have law degrees which are advanced degrees. I am sure one can be a banker with just a BA degree. Not that advanced.

Really are financial managers the brain surgeons of the industry. Who was Madoff...a brilliant leader of your industry? A brain surgeon of finance?

When comparing salaries of people in different countries, you shouls also add in comparables like housing.
In India and China, you can get a house for 10k. I could live on 15k if my house cost 10k. I could get a house for 5k in crime ridden Brazil too... I could live on 15k if my healthcare, insurance, housing and schooling needs were taken care of by the middle class.

Since bank are practically nationalized the salary scale should be matched with the public sector (government employees)

There have been a couple of borderline comments in the last couple of hours that I have either edited or deleted. I almost never edit comments and even more rarely delete them without publishing them. I think those who visit here know that I publish a lot of random stuff, even when I strongly disagree with it. I love your comments and look forward to them all. But I will not publish hateful remarks, ad hominem attacks, or statements that are just plain nasty and seek to bring out the nastiness in others. There are a host of places on the web that are congenial to such thoughts, but this is not one of them. As always, thanks to you all for reading and, of course, for commenting in such energetic, passionate and often amusing fashion.

Experienced Architects are skilled in finance, management, creative thinking, schedule and budget management, and know how to produce a product. Running a bank would be easy, except for the aspect of firing most of unneccesary the management staff. I would bet that there would be a long list of capable, trustworthy Architect candidates willing to run any of the wall street clown acts known as investment banks for 200k per year, plus a small percentage of profits after these were cleaned up. Oh yeah, one other thing...unlike lawyers architects have a code of ethics. On the other hand, most bankers are not qualified to answer the phone at an Architect's office.

Employers set the salaries they want, sometimes they use the market to set salaries, sometimes they do not. Big Brother is about to become the largest shareholder of a bunch of banks and other companies, being the largest shareholder mean that they can set the rules of the game. You do not like what they pay? fine, go find another job or simply do not apply. You do not like a Teacher's salary? find another profession, same goes if you do not like the salary of an Engineer, Doctor, Janitor, Pilot, etc,,,,This is America, you are free to work for whoever you want.

I love the smackdown that's going on between professions here. I should say that some of my best friends are lawyers.

Bing, I give you credit for bravery and patience. Reading the comments was really a trip. Then I got to your part about "blog-havior". I dread to think what you may have seen come in.

I admire your willingness to print whatever comes over, as long as it meets certain standards of respect, maturity, and clarity. Even sometimes when it doesn't, but might be interesting anyway. I am tempted to smack down a few of your bloggers, but then, what right do I have?

Keep pushing the buttons with wit and keen observation, Bing. I am getting to know my fellow bloggers in ways that I never expected.

So mgt salaries...I followed the link, it seems this is a Program Mgrs median...what's a PM? Commercial or govt?

I like lawyers, I don't care what anybody says...they get paid commenserate with the effort they put in...shouldn't it work the same for everybody else?

Teachers and nurses are unquestionably fine people
but to run a bank I'd lean toward architects.

Teachers can attribute bad results to poor students.
Mistakes by nurses are soon buried. But enduring
monuments bear testimony to the judgment and esthetic
sense of architects which the public both sees and
experiences. I think this makes architects especially
attentive to detail.

On the other hand, to get the substantial assignments
they often schmooze the politicians.

So here's a real suggestion ...
A little while ago a news story told of a very decent
man who chose to sacrifice his job so that a colleague
with small children to raise wouldn't have to lose his.

Why has this man not been put in charge of a bank?

Even little old Spokane is filthy with attorneys..from Gonzaga Law School.....and of course the reason why the median pay is so low is that the market is saturated, and the mental entry requirements almost non-existent (unlike engineering or any number of other serious disciplines). We just seem to keep pumping them out. I guess liberal arts majors need to eat too. 'Juris Doctor, what a hoot!

I've known many, almost all fine fellows, sociable sociopaths almost every one. A good attorney has no moral compass....an argument from any direction is fine as long as billable hours are involved.

And Bing, just as you say, "some of my best friends are attorneys" (kinda reminiscent of something I can't quite put my finger on), I tell my attorney friends that, "you're one of the good ones".

"Some of my best friends are lawyers..." You are always good for a chuckle, Bing.

I should add that the lawyer I fired used to wave me into his office whenever he would see me walking by on the sidewalk. (He really was storefront, you see.) And this went on long after I fired him.

He was having family problems and his law business was tanking, too. He just needed someone to talk to about it, I guess.

I told him that if I spent more than fifteen minutes listening to him, I would have to bill him.

I'm a consultant after all...

See, its the whole pay for performance debacle that got us here in the first place. When we started basing pay on stock performance, it encouraged CEO's to do EVERYTHING to get the stock price up, so they get paid...and get paid large. So, formula to success: get in the company, slash and burn to cut costs; make the #'s look good, give great guidance, and the stock price rises. The Board (whose in your pocket, as you have consolidated all three roles: Chairman, CEO, and President) rubber stamps all this, as they want the price to go up; and they are CHairmans, CEO's, or Director's for other companies, so they have a vested interest in keeping the cycle going.

Simple.

Until stockholders band together and revolt, nothing changes. Toss out the boards; get long term CEOS's; break up the trifecta of CEO, Chairman, and President; and you have a start to some real governance.

Sung to the tune of Satisfaction.

I can't live on,
No half million.
I can't live on,
I've made a zillion.
(Just last year, bitch!!!)

Well I try,
and I try, and I try,
and I try, try, try

Well hey, hey, hey,
The estate's bein auctioned today

I was flyin round the world,
I was screwin this,
I was signin that,
I was tryin to make this deal,
Maybe better come back,
Maybe next week,
Gotta hock my Rolex,
I'm in way too deep.

I can't live on...

and out

Is everyone noticing the word 'depression' showing up more frequently in the press, much as the word 'recession' rattled around while various yahoos finally admitted we were in the midst of one?

Time to buy more ammo and beer.

Some Darwinian theory at work here.
So if we cut bonuses and cap salaries at companies receiving bailout money, they will lose all their senior leadership and the best and brightest minds in the comapny for greener pastures?

Wait just a minute here. Are these best and brightest leaders not part of the reason your company needs to be bailed out? Didn't they formulate the foundations of this mess. If they are any good, they will either stick to the company and recover their losses (or lower gains as it stands), or go somewhere else. If they go somewhere else and fail as miserably as they have in their current job, at some point they get exposed as a fraud and drop from the talent (gene) pool.

At least that is the theory. Some of these geniuses do manage to convince people to let them continue to destroy organizations while collecting obscene salaries. Imagine the interview:

"So tell me about your accomplishments."

"Well, I took a Fortune 100 company to the brink of bankruptcy and begged for billions of dollars of taxpayer funded bailout money."

"I see. That sounds impressive. Why did you leave?"

"The government capped my salary. I just can't seem to live on less than 18 million, and then there were going to be no bonuses!"

"Yes, I see. How much do you need to bring us the same level of success?"

"Well, I support a lot of people. There is the private jet, it has a pilot and ground crew you know. And of course there are the three ex-trophy spouses and their entourages. Twenty million should just about cover it, with 110 percent bonus for any stock price based goals that I achieve."

Mike,

I just did except I have to substitute red wine.

100 rounds of 32 for a last chance pocket pistol and 250 rounds of 9mm for any and all eventualities.

Sadly, I'm beginning to believe that my wife is the better shot.

I've always been fond of a woman who can kill you in more than one way.

Incidnetally, anyone who would like to meet such a woman, my wife is very good friends with a former member of the IDF. A good looking computer expert who can also field strip an Uzi.

Now, that's sexy, baby.

Paul,
As you know, happiness is a warm gun, and my concealed carry happiness is a Taurus .45 subcompact. With 11 rounds it better give me both my first and last chance.

I really should hoard whiskey, not beer, because beer doesn't age well. That's what they tell me....I've never let any sit around long enough to find out. I'm a man of simple pleasures.

This great hulaballoo about pay caps is just someones idea of how to calm dowm the restless natives..

Makes for good P.R. but it doesn't cut ice with me...anybody in that position could work for a dollar a year and still come out nicely with company expenses, stock options etc...

Do you think the President ever picks up the lunch tab, or goes shopping for groceries etc etc..
or puts gas in his car to get to work...

I afraid when all is said and done, the powers that be will ride out of this mess on the back of the working man...always been that way and always will be that way..

All this reminds me of the Rodney Dangerfield "How dumb was he?" joke, about being fired from a bank for stealing the pens. If only.

www.sawyerspeaks.wordpress.com

To the tune of You May be Right:

Friday morn we crashed the market,
Saturday my driver parked it,
I'm not close enough to Paraguay!

Well I shouldda took my plane,
but it's hangered, Couer d'Elaine, (that's Idaho, buddy),
Can't afford the hours of downtime.

You may be right,
I'm un-indicted,
but it just might be a co-conspiritor they're looking for.

Too late for flight?
I do deny it,
I may be wrong,(unlikely, MBA-Wharton),
for all I know,
I may be right.

Jack,
I'm always amazed at the interest and knowledge that Canadians display about the US (maybe 'amazed' isn't the right word...I guess when the behemoth rolls over, its neighbors are always concerned about the potential inconveniences). Being in a border state, having visited the western provinces (all the way up into the Yukon Territories) our lack of interest in your state of affairs is somewhat of a sore spot with the inhabitants.

We would do well to pay more attention to Canada, because as we inevitably become more oriented towards socialism, we will find that such movement is not catastrophic. The US has a fixation on the myth of rugged individualism. Whether we like it not, we will end up helping care of each other, either the hard way or in some manner that involves a degree of compassion.

So a banker,doctor, lawyer, architect, nurse and teacher walk into a bar...the bartender asks "shouldn't you all be at work?"

I apologize deeply for that...I'm so ashamed...

Spokane Mike, thanks for the link to that read, great stuff!

I am of the mind that I will only be as good as the people who support me allow me to be, and if my behavior is regarded as self-glorifying and monetarily selfish, then those who did and still could support me probably won't continue...they will just focus more on braiding the rope to be given to me, until the day I sway at the end of it.

Henny Youngman walks into BOA headquarters.

Ken Lewis says, Take my Merrill losses, please.

You've got that right Bing. It's hard to make ends meet on half million a year. After all those years living on 10 mill yearly salary plus bonuses what the world has come to? Well, Bring them down from the clouds they were riding for way too long .

Hi Mike, I agree,,,America is changing and it is losing it's fear of socialism ,,,commies under the bed etc...

The average American is finally coming around to that view...

The people have been played too many times with slogans and propagranda,,,now they want real results...

A goverment by the people,,for the the people...not special interests

I would argue one step further, there is a dose response curve between salary and work ethics. Like a drug, or even water; too little is unhealthy, average best, and too much is, well, unhealthy. People who think they deserve so much more than others are people to avoid like the plague.

Why, why, why, do we not take the ill gotten gains back?

Hey JJ in Indiana- we all know that you're a lawyer, and we feel your pain. You haven't been as successful in court or in life as you'd like to have been. Why don't you give your job to a teacher or a nurse, and just go curl up in bed and cry...Just let it all out.

Lets just think about for a moment how these absurd banker salaries came to existence. Well, somebody approved them and it was the board of directors most likely. So apparently the shareholders are totally stupid or they have limited rights. It would be better to address the root of the problem instead of the result. The government should seek compensation that maximizes performance. Be it $50,000 or $5,000,000. For a bad job I think even $500,000 is way too much.

OK, I'll fess up and admit I'm one of those loathsome lawyers. But, my moral compass is just fine, thank you, and probably more finely calibrated than most others, notwithstanding my chosen profession. Thankfully, I am not a slave to the billable hour given that I am a transactional attorney. I charge a flat fee for most of my work which seems to work well with my clients. One thing I have noticed over the course of my career is that it seems everyone (and I do mean EVERYONE) at one time or another wants good legal advice. They just don't want to pay for it. So, I am constantly subject to that "one small question" about my speeding ticket, or my son's DUI or my husband who won't pay child support, even though none of those matters are anywhere near my area of expertise. So, the next time you're at that soccer game, birthday party or cocktail party and find yourself standing next to one of those stinkin lawyers. Don't ask that "small question" unless you immediately pull out your wallet and hand him/her $50 for their time.

This is a ridiculous public debate involving few facts and lots of emotion. For instance, where is the analysis of the cost of living? Where are the financial centers in the U.S. - NYC, San Fran, Chicago for the most part. How much is it to purchase a home or rent an apartment in these areas? How much to send the kids to private school? How much is the average grocery bill? How much is it two dine for two at a restaurant? What is the average education level (HS, BA, MBA?) and how much did it cost the recipient? For any of these answers I will bet you it's much more than it is in Houston or Cleveland. So if you place a cap on someone's cash income, you may as well place a cap on the institutions contributing to their high living expenses as well. Another thing, over 33% of employees at Bear and Lehman had company stock and the top brass had their compensation mostly in stock... you see how that worked out.

I'm an attorney working for NYC with 22 years experience. I'm getting 17K less per year than a NYC teacher gets with the same experience

Hey Think Critically America (NYC) -- here's a fact for you: there is no real reason that everything done in the "financial centers" of NYC, Frisco or Chi-town can't be done somewhere else with a reliable high speed cable system. If you absolutely have to have a NYC lifestyle to do your job, then that's fine for you; but it's not a necessity for the job. And if you have to send your kids to a private school in order to get a decent education, then you may want to consider moving out of that area anyway.

With re to Wilbur in Bison, KS (February 6, 2009 3:16 pm):

Truman-Kennedy, 1945-63, US real GDP grew 2.6% a year on average over those 18 years.

1988-2006, another 18 years, US real GDP grew 2.9% a year on average.

If you're going to say the 1st period was real successful, what would you say about the second? Food for thought ...

You left out the following

entry level engineer: $35,000

And you wonder why the bright kids went into finance during the boom rather than making steel or designing hip implants for Stryker?

Don't believe what you see published anywhere else for salary figures for new engineer's either the federal government or the engineering schools. Its all lies.

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