CEOs who cheerlead for market forces wouldn't think of having them actually applied to their own pay packages. If you want Michael Jordan in your lineup, you have to pay what it takes to get him. Here's how it works. Say Amalgamated Widget is looking for a new chief executive to turn around its troubled operations. Once the board settles on a candidate, the candidate's lawyer has a compensation consultant prepare a report showing the salaries and stock packages given to CEOs at similar companies facing comparable challenges.
Executives know that once they crack the inner sanctum, even failure is richly rewarded.
Frontline employees who feel outraged and demoralized by such payoffs can't be blamed for thinking they represent hush money at work, not the free market. Even insiders are getting squeamish at the excess. This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law.