“WASHINGTON — The Obama administration has begun serious talks about how it can change compensation practices across the financial-services industry, including at companies that did not receive federal bailout money, according to people familiar with the matter.”
“At the same time, House Financial Services Committee Chairman Barney Frank (D., Mass.) is working on legislation that could strengthen the government’s ability both to monitor compensation and to curb incentives that threaten a company’s viability or pose a systemic risk to the economy.”
The United States has nationalized investment banks, traditional banks, the nation’s largest insurance company, and automotive companies. The United States has fired executives and decided who shall and shall not receive bonuses at these companies. Now, the United States is trying to decide how and how much people in companies that have not been nationalized deserve to be paid.
President Obama and Congressman Frank would have you believe that they know which pay structure is best. They would have you believe that they are more informed than these financial firms or the numerous compensation consulting groups they hire to determine which means of compensation will return the greatest production. The members of our government would have you believe that they simply know more than you, and that you should, therefore, yield all decision making to them.
Well, I say that they are wrong. I say that few things could do more to “threaten a company’s viability or pose a systematic risk to the economy” than the United States Government deciding how much and through which means people are to be paid.