Evening star., 1933-10-19
HINT PLAN TO LIMIT
PAY Of EXECUTIVES
Data Five Federal Agencies
Are Asking Seen Drive
at Heavy Salaries.
BY the Associated Press.

BY the Associated Press.
Rooseveltian legislative experts a.
present are planning to throw more
light on salaries paid to business and
financial leaders as means OF ADJUST
ing those salaries downward.
Five Federal agencies are gathering
the data.
1t was said privately today by an I'M
portant official that such information
will be used as basis for legislation to
curb excessive payments to executives
probably the continuous publication OF
these payments
An economic theory of some admins
tration counselors is that much money
now going into high salaries should be
spread in the lower wage brackets to in
crease popular purchasing power.
Data Asked of 1000 Businesses.
The Federal Trade Commission, under
q Senate resolution, has addressed a
QUESTIONABLE to 1000 corporations OF
over $1,000,000 capital each which have
securities listed on the New York Stock
and Curb Exchanges.
The Reconstruction Finance Corpora
ton is to report salaries of banks which
request loans and the Interstate Com
ulSICc SOIllllllSSlOIl dlledOy Ildo dSICo w
reduce salaries of railroad executives.
The Federal Power Commission must
report salaries of public utility execu
tives and the Federal Reserve Board
must report the salaries of bankers in
the Reserve system.
So extensive is the survey that OFF,
cials feel all payments of Importance
throughout the Nation will be reported
not only as to past years. but as of
certain date this year-Sepember l in
the case of the corporations being
studied by the Trade Commission.
Publication itself, officials say, Is
quite effective as salary reducer and
1t is definitely in official minds to pre-
pare an amendment to the securities act
to require all corporations to publish
the salaries of executives in connection
with the sale of their securities.
Look to Publicity for Effect.
Probably there is no legal way di-
3ectly to force corporations to pay low
salaries, but it is felt that continuous
publication will have the desired effect
Just as publicity on security issues
tends to make promoters more careful
1t is held. so also publicity would make
executives feel somewhat reluctant to
undertake the task of convincing stock
holders and the public that they were
earning salaries of a quarter million or
more.
Many economists look upon high SAL
aries as especially important in view of
the great power of corporation managers
as opposed to the lack of power of the
stockholders-the owners Publicity, it
Is held, will at least keep stockholders
informed as to what their managers are
receiving, and so may serve to curb
managerial power somewhat.
There have been several cases in the
depression where executive salaries have
been mainland at high rate while the
companies concerned were actually oper-
atlng at deficit. officials point out, and
while wage rates in the lower brackets
were being cut drastically.
That the investigation is directed at
limiting salaries is further shown by the
Trade Commissions request not only
Tor the salaries themselves, but for all
other compensation, bonuses, special
fees, stock dividends and so on.