Write to the candidates: What would you ask Americans to sacrifice?

[netmouse]

I appreciate the positive feedback I've gotten on my post about my letter to Senator Obama about donating blood, etc, and I'll appreciate it even more if you'd chime in and send the same message to him through the campaign's debate feedback form. That will make it more likely someone will take notice. (Feel free to spread the word, and/or link to my post).

While you're thinking about it, what would *you* ask America to do, to sacrifice, if you had the the kind of national attention these candidates can get, both as candidates and potentially as President? Write to them about that too.

In addition to the question of giving blood, one big thing I saw missing from both of their discussions of an energy plan was manpower. George Bush has made some somewhat lame mentions of the fact that some Americans are dealing with the gas price problems by driving less and riding bikes and such. Sure we are! And we should do more! Don't we have a national struggle with obesity and diabetes? We can address that and gas shortages and prices at the same time, by using old-fashioned manpower to get around. By hooking up generators to the stationary bikes and other exercise equipment we use at the home and the gym, so they generate electricity instead of using it up. By building bike-powered drive-in theaters and other such alternative energy solutions. Part of dealing with the energy crisis should include encouraging bike-friendly urban design and rules of the road. Hybrid and electric public transit as well as personal cars.

There are a lot of things they aren't talking about. So go call them on it!

(you can contact the McCain campaign here).

Comments

[sardonical1.livejournal.com]

They already pay far too much in taxes. Personally, I think everyone should pay the same, low rate -- perhaps 9%.

[netmouse.livejournal.com]

Sometimes I am amazed at how rich the vary rich are, and at such cost to others... especially how much more some executives earn than their workers, and while I don't think it's the government's job to regulate that (other than for non-profit companies), I do think we should encourage more egalitarian policies, perhaps for instance by only giving government contracts to companies where there is not more than a 10:1 ratio between the highest wage earner's salary and the lowest salary in a company.

I also don't believe in these huge buyouts so many CEOs get as their reward for running companies poorly, but have no idea what any of us can do about that common practice.

[sardonical1.livejournal.com]

Have you ever wondered why companies pay their CEOs so much? Could it be because the competition for talent is fierce? Let's say a company adopted your suggestion, and had a rigid 10:1 ratio. They will certainly get some applicants, but would they get the best ones? Companies have to raise the wage for CEOs in order to attract talent. And the number of individuals who have the skill, experience, competence, and background for some of these positions is very low. Anytime you have low supply, and high demand, the price goes up. Hence, the high price of CEOs.

As far as the high costs of severage packages: sometimes it is better to pay a CEO a couple of million to leave rather than to have that person mismanage a multi-billion dollar company. You can't just fire them (they have a contract and thus they would tie the company up in litigation expenses, which could also add up to a lot of money). Better to just pay the incompetent to leave.

[netmouse.livejournal.com]

It has not been my experience nor my observation that most high-paying executives have more talent than other people, nor that they are so successful that they deserve that much from the companies they work for. I have in fact seen companies drive their overall worth and effectiveness down through hiring executives they thought they needed in order to grow, who then contributed little but a dramatically larger overhead cost to those same companies, especially when they had to be paid off to make them move on.

*some* executives are no doubt worth a lot, but I don't see why companies should give them tighter contracts than anyone else. 6 weeks' severance plus more depending on period of service ought to be more then enough for someone who is being fired for cause. I think a lot of these golden-parachute deals are simply being put in place by greedy executives in companies that lack oversight because most of their shareholders invested through mutual funds and other such vehicles and take no personal interest in the particular policies of the company that the legal system assumes shareholders will rein in.

The established paradigms of business in this country need to change. They aren't working.

[sylo-tode.livejournal.com]

Where's the law that says they have to have such contracts? Knowing what's at stake, they could easily put in conditions to be met in order to receive those massive benefits.

[sardonical1.livejournal.com]

There is no law that says that they have to have those contracts. However, it is an industry practice to pay a CEO a salary, including some benefits. Would you prefer that, if the CEO were fired, that he would then litigate in court and try to establish a record with regard to how much he was "promised?" Isn't a contract how we do business in America?

The board could, of course, include a provision that says: "You will receive nothing if we determine that you are not competent." If you wish for companies to adopt such a policy, contact the ones that you have stock in. But asking Congress to impose national policies in this area is absurd because companies should be flexible to be set up in a way that works, not based upon what is popular or sounds good on the campaign trail.

[nicegeek.livejournal.com]

My suggestions for reforming public companies:

First, require a shareholder vote on CEO pay packages. Right now, CEO pay is decided in closed-door negotiations with the Board of Directors, and there are some very incestuous cross-memberships between large company boards. This allows mutual back-scratching between members of that club when negotiating pay packages and evaluating performance. Big severance payments for CEOs who are fired for poor performance are not in the shareholders' interest, and they should be able to veto them. I believe that they will, given the opportunity.

Second, company executives should not be allowed to be members of the Board. The Board is supposed to supervise the CEO, and if the CEO is on the Board, they can make it socially very difficult to perform that supervision properly.

Third, I think that the process for shareholder votes (particularly for board elections) needs to be revised. Right now, most shareholder ballots prominently feature the default option to give one's proxy to the Board, essentially going along with whatever they want. A large percentage of ballots are simply returned with that default, thereby giving carte blanche to the Board to do as they please. IMHO, the Board should not be able to take such proxies; shareholders should either research their vote properly, give their proxy to a non-Board member, or withhold their vote.

All that said, I disagree with putting limits on CEO pay, because I don't think that they would work out the way you hope. Every CEO's base salary would become equal to the limit, and then they'd negotiate lots of other perks carefully designed to get around those limits, and write them into book-length contracts written to be ambiguous and opaque. You could have a whole government department devoted to enforcing such a law, and all it would do is spawn more law firms specializing in getting around it. It's the shareholder who have money at stake, and they can and will hold the company accountable, if they're given the tools to do so.