Power to the Shareholders!

While I agree with your overall point that the government has no business telling companies how much to pay their CEOs, the fact that "the sins are against the shareholder, not the taxpayer" doesn't mean very much if a crime is committed. It's the government's job to determine what constitutes a crime and to make sure that no crimes are committed, and to punish them when they are. If the government decides that paying CEOs excessive amounts of money is a crime, then they have every right to intervene. Now, I don't think that the amount of money a person gets paid for legitimate work is the government's business, and I find it quite disturbing that the government thinks it is.
>> Matt August 27, 2009 4:35 pm

Matt-- It is up to the government what constitutes a crime? What kind of Orwellian logic is that? There is currently no law that says an executive can't make over X amount of dollars thus no crime has been committed. All Congress is talking about doing is setting up an arbitrary panel that decides who can make what. Where will it end? Would you be for the same panel deciding what you make?
>> Mavis August 27, 2009 5:26 pm

Matt: An arbitrary government panel has decided that it "constitutes a crime" for Matts to comment on this blog. They will now "make sure that no crimes are committed" and will be punishing you. (Congrats!) I guess that example is about as targeted, arbitrary, and downright ridiculous as the government telling some individuals how much money they can make.
>> Horace August 27, 2009 5:54 pm

Oh, I completely agree that the government shouldn't be telling people how much money they make - I said that twice in the comment I made. And Mavis, yes it is up to the government what constitutes a crime - they're called laws. Laws determine what is a crime and what isn't, and governments make laws. I really don't see how that's a difficult point. References to Orwell should probably be saved for actual cases of totalitarianism, not little things like governments making laws. Now, if you had carefully read my post, you would have discovered that I find it abhorrent for the government to be deciding what amount of money CEOs or anybody gets (except maybe government employees). Both of you attacked me on that point, but I never said that I disagreed; in fact I agreed twice. I was merely making the point that just because the people who decide CEOs' pay are shareholders, not taxpayers in general (though shareholders are in fact taxpayers...), that doesn't make them exempt from government action in all cases. I completely disagree with the proposed government action in this case, it was just a weak point in Pacini's argument that I was pointing out. And on a separate note, something's really weird with the timestamps in these comments. I think it's probably a time zone issue, but it says the second comment's time was before the first comment, which is clearly impossible. And when I try to make another paragraph with a new line in this text area, it doesn't show up in the comment. Looks like newlines are getting stripped unnecessarily?
>> Matt August 28, 2009 10:52 am

Actually, I figured out what might be the problem with the timestamps - you're showing the day again instead of the hour. See, August 27, 2009 27:35 PM? All three of the first ones have 27 for the hour. And the one I just posted has 28 for the hour, posted on August 28th. Sorry, I'm a computer scientist, and when I see bugs that are easy to diagnose and easy to fix, I figure it's helpful to point them out.
>> Matt August 28, 2009 10:56 am

Perhaps I'm beating on a dead horse here, but here's one more example. What about the government blocking mergers for anti-trust reasons? I guess I'm using the term loosely, but it apparently is a crime to merge two companies if it is not in the best interest of competition in the industry (and thus consumers), so the government disallows it. It is not unprecedented, or even always undesirable, for the government to intervene in the actions of private businesses, even the actions of the shareholders of private businesses. And to continue beating, I'll state again that I completely and wholeheartedly disagree with this case of government intervention, trying to mandate what constitutes fair pay for the legitimate work of CEOs.
>> Matt August 28, 2009 11:03 am

I believe, Matt, that the Orwellian reference was directed to your choice of words: to say that "the government decides" what is law is incorrect; the people, through the legislatures, decide what is law. What is frightening is the idea that the DOJ, or the President, or any other government official can determine what is lawful and unlawful behavior--their job is to enforce the law, not create it. What I am arguing is that the people don't want laws on how much people make--and they shouldn't. There's nothing wrong with the government enforcing pro-growth policies, but government interference in compensation is about as anti-growth as you can get.
>> Benjamin Pacini August 28, 2009 11:37 am

Ah, but you see, you said "congress," not the executive or judicial branch, was considering this proposal. Congress is the legislative branch of government, and makes our laws. Hopefully they represent our, the people's, desires. But if you want to say that the legislature isn't government, good luck with that. We're a republic, not a true democracy (which is probably a good thing most of the time). I stand by my statement that the government makes laws. And again, I agree with your argument, I just think that one of your supporting points was weak =).
>> Matt August 28, 2009 11:52 am