Editore"s Note
Tilting at Windmills

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September 17, 2003
By: Kevin Drum

THE REAL LUCKY DUCKIES....Speaking of lucky duckies, New York Stock Exchange head Dick Grasso has resigned:

Alan G. Hevesi, the comptroller of New York State and the manager of the country's second-largest pension fund, said Mr. Grasso could no longer be effective. "Mr. Grasso is a regulator among other things,'' Mr. Hevesi said Tuesday. ''You create the perception of a conflict of interest when those that you regulate pay you $200 million over time."

Ya think?

Still, save your tears. It's not as if Grasso is planning to give back the $140 million plus he's already been paid. His retirement years ought to be fairly tolerable.

POSTSCRIPT: Here's a point that sometimes gets lost in conversations about growing income inequality in America as represented by gargantuan pay packages like Grasso's. Although liberals like me generally support limited government actions like progressive taxation as a way to ameliorate income inequality, most of us understand that there's a limit to how much government can and should do about this.

However, even if you don't believe the government should be involved in arguments over executive pay, there's nothing to prevent shareholders and public figures from trying to shame our nation's plutocrats into more responsible behavior. That's largely what happened here and I applaud it. Incestuous compensation committees will continue to expand executive paychecks far beyond anything that a free market would ever deliver until society simply makes this unacceptable. If people like Grasso are shunned and embarrassed over this kind of legalized thievery often enough, maybe we can put an end to it and redirect some of that money back to shareholders, to whom it properly belongs in the first place.

Kevin Drum 4:45 PM Permalink | Trackbacks

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