I hope that those who read the quote by James F. Reda
in today’s New York Times
’s words as representing a huge part of the problem facing this country.Reda
, the founder and *managing director of James F. Reda
& and Associates, a compensation consulting firm, was asked what he thought of the Obama Administration’s plan to place a $500,000 cap on compensation to executives at companies receiving federal bailout money.
“That is pretty draconian, $500,000 is not a lot of money, particularly if there is no bonus…And you know these companies that are in trouble are not going to pay much of an annual dividend.”
I don’t know about you, but to me $500,000 is absolutely a lot of money. It is more than 10 times what the average worker makes. Make that “made.”
Annual compensation of a half million dollars is “not a lot of money” only to the few, powerful and self-indulgent living in a world of Riviera mansions, Aspen ski chalets, private jets and pearl-handled toilet plungers.
The article lists some of them. Kenneth D. Lewis, head of the hat-in-hand Bank of America, took home more than $20 million in 2007. The clearly clueless Richard Wagoner, head of GM, raked in $14.4 million. (Don’t get me started on college football coaches and NBA point guards.)
A story in last Friday’s New York Times tells us that in 2006 (the last year for which the figures are available) the 400 wealthiest Americans made, ON AVERAGE…are you ready for this?…$263 million.
That’s on average in one year.
The motives, wisdom and competence of those allowing themselves to be paid so lavishly should immediately be suspect.
They have lost touch with reality — yours, mine and that of the vast majority of Americans.
So let’s just put it out there—and, Mr. President, note that I am reducing your cap number here. It means a cut of $100,000 in your own presidential salary of $400,000.Bailout money aside, no one should be compensated at a rate of more than $300,000 a year.
That’s enough. Actually that’s more than enough, as 98 out of 100 know, but we have to start somewhere.
If a company has more money available for executive compensation, it should rework its numbers. The money should used to raise the wages of everyone else, starting at the bottom — from the secretaries to the janitors, to assembly-line workers to the accounting clerks and sales staff.
As for James F. Reda
— fire him.
Labels: Barack Obama, executive compensation, James F. Reda