Sunday, April 20, 2008

If Corporations Want to Act Like Wards of the Government, Why Not Pay Their Leaders as Such

While rightly bemoaning the bipartisan urge for unprecedented government intervention in the marketplace, George Will suggests a way to perhaps suppress Wall Street's desire to scratch Congress' interventionist itch:

Republicans and Democrats promise cooperation, compromise and general niceness using other people's money. If Congress cannot suppress its itch to "do something" while markets are correcting the prices of housing and money, Congress could pass a law saying: No company benefiting from a substantial federal subvention (which would now include Morgan) may pay any executive more than the highest pay of a federal civil servant ($124,010). That would dampen Wall Street's enthusiasm for measures that socialize losses while keeping profits private.

One suspects that would dampen the fervor for corporate bailouts by the Fed.

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