Executive Talent Pools

"They" tell us that limiting the pay of corporate executives would force the talented men that run corporations to pack up their bags and move to Antigua or something. Let's consider that.

We learn from The Economist that since GM took over Saab 20 years ago that Saab has operated at a loss for 19 of those years. We learn that each Saab sold in America sold at a loss of about $5000.00 per car. We learn that these operating losses may have cost GM as much as $5,000,000,000.00. We learn that GM's vice-chairman, Bob Lutz, that GM held on to Saab for 20 years because they, "loved the marque and the cars."

Over at US News And World Report we learn that GM expects to burn through $18,000,000,000.00 in 2009.

Can you put a price on that kind of talent? I have some thoughts. They would start with Bob hanging out in Antiqua or something.

Lutz is just one example. Many more abound. Executive pay is determined by a company's board of directors. The board of directors of most companies are largely made up of executives of other companies. They scratch each others' backs.

I don't like the idea of the government setting the pay scale for executives any more than I like the government setting the pay of the peons in a company. (See GOP law makers complaining about union wages at the Detroit automakers.) But the results of a great many companies don't justify the executive salaries. If the Titans of Industry are only in it for personal enrichment then those are the wrong people to be running the company.