E Thomas St.

Why Capping Pay Is Likely to Work

Here is a thought;

If the cap is 500k for receiving funds and the payoff for the executive team is higher for not receiving funds, what is the motivation for taking said funds?

Now to jump into the "talent discussion". Sure there are a lot of people that'd take the CEO job for 500k, but those same people might consider the 600k CEO job more. Further, if the company that offers 500k hires on a CEO for that amount and they fail, the whole "magic bones" fallacy comes into play. Was it the CEO? Does a better CEO cost more? What is the ROI with a CEO anyway? If the CEO succeeds what is the company doing to keep them? The entire question of compensation needs a reevaluation from the side of the business paying out salaries and needs to call the bluff of those people.

GMAC: Happy to Lend You Some of Your Own Money

Wouldn't it be more efficient to simply hand all tax payers a share of 5 billion dollars instead of loaning 5 billion dollars to a company that has no financial plan and overhead to boot? Think before you type.


On Dec 31 11:27 AM uncle bubba wrote:

> One last thought, with the government using the TARP funds to help
> GM this program may do what it was intended to do. The economy is
> slow due in large part to people not buying, not putting dollars
> through the system. If Joe six pack buys a car, the dealer profits,
> the manufacturer profits. Those profits are paid to employes who
> in turn spend at the local resturant and stores and the economy starts
> working its magic as the dollars turn. This seems to me to achieve
> the ends envisioned by the congress as opposed to the banks who have
> held on to their funds to make the balance sheet look better without
> putting the money into the economy.