Excellent Commentary .......................................................................................... Exxon Mobil has defended Raymond's retirement package, saying it was pegged to the rise in the company's profit and market capitalization that occurred during his tenure. ................................................................................................. It was pegged by the Bush Cheney War policy..... ................................................................................................ The key point here is that when Bush Cheney decided to go to war with Iraq....how could they have possibly not known that the action itself would cause a dramatic rise in oil prices...and thus windfall profits to their constituency ?????
I don't follow your hypothetical. Larry David is not the CEO, he is talent or someone selling a show. All I am saying is that CEO compensation is demonstrably out of control, that any rational person can see corporate governance has broken down on this issue and that it has become such a problem that it could pose a threat to the economy. The solution, government control on CEO compensation, is not perfect but it is far preferable to the status quo.
I don't think it's correct that shareholders don't care. I think most shares are held beneficially by institutions, which have enormous conflicts that prevent them from voting the way their investors would want. Even some of them are beginning to squawk, like CALPERS. You highlight another reason these outlandish comp packages are dangerous. You point out correctly that XOM is the world's largest company, and therefore conclude the CEO deserves the biggest paycheck. But that logic leads to corporate consolidation simply for the sake of size. There is no evidence that size correlates with anything positive, and much evidence that it just creates sluggish bureaucratic dinasours, of which XOM is a prime example. Then you have the fact that XOM's profits did not derive from anything this guy did. In fact, his overly bearish oil price forecast probably cost them big time. He just happened to be in the right place at the right time. Nothing wrong with that, but I don't see that it justifies a comp package four times the size of the Yankees payroll.
"All J6P knows is that he has some money in his 401K or pension plan. He probably doesn't even know the name of the institution that manages it, and he definitely doesn't know if any of his funds own Exxon stock. If J6P actually knew that his shares were being voted to pay some guy close to half a billion dollars to retire ... I'm sure most would vote NO" it never ceases to amaze me the way collectivism goes along with elitism and disgust for the common man (all rhetoric aside) every person who owns stock is a partial owner of a company PERIOD it is the RESPONSIBILITY of shareholders to know what stocks they own, and attend meetings, vote by proxies, etc. those who do not, only have themselves to blame. it is not the "institutions" fault. Fault, just like responsibility, lies with the shareholders to make their viewpoints heard am i disgusted by some shareholder salaries? yes. i am also disgusted by some hollywood stars salaries, by some sports stars salaries, etc. - in a sense - but their salaries should be WHAT THE MARKET WILL BEAR. if you think a CEO gets paid too much - then attend a shareholder meeting, or sell the stock, or whatever. the point is that it is the MARKET that decides these things, not the heavy hand of govt. i own XOM stock. i am well aware of how much profit they make, and what the CEO gets paid. bully for them. it's been a great performer. it is true, that people in some 401k plans don't have much choice in what stocks are chosen in their plans/funds. that is the nature of mutual funds. get an IRA, etc. and make your own investment decisions. every "market guru" in Elitetrader seems to think they are so much smarter than the CW, than "joe 6 pack" etc. get real. if you are disgusted by high CEO salaries, then don't invest in companies that pay their CEO's "too much" - (whatever that is).
Government control of anything is NEVER the best solution. What has the goverment been able to "fix" in the last 100 years? NOTHING. CEO salaries should be tied to the companies performance, period. In this case the stock went from around 11 in '94 to about 65 now. That package is only 1.1% of LAST YEARS profit. If you add up the profits over those 12 years plus the increase in market cap the retirement package would work out to be a very reasonable equation. This guy may not be a genius but he was in the right place at the right time.
My wife and I usually pump our gas at Exxon/Mobil stations with our rebate cards but that's going to change soon since we share the same disapproval. America is not in that great of a shape. In case others here would also decide to exercise their consumer power, don't get the Shell card because you won't get the rebates they advertise. Why? They'll tell you that you didn't check the checkbox at the back of the form stipulating that you actually want the rebate card, even if the form you picked was for a card advertised as the rebate card.
"The solution, government control on CEO compensation, is not perfect but it is far preferable to the status quo. " no, it's not. it's unamerican, anti-capitalist and collectivist. why should govt. have the authority to put a cap on wages? are you SERIOUS? "Government control of anything is NEVER the best solution. " that's just dumb. are u proposing govt. shouldn't control - police, fire, the military, etc.? "What has the goverment been able to "fix" in the last 100 years? NOTHING. CEO salaries should be tied to the companies performance, period. In this case the stock went from around 11 in '94 to about 65 now. That package is only 1.1% of LAST YEARS profit. If you add up the profits over those 12 years plus the increase in market cap the retirement package would work out to be a very reasonable equation. This guy may not be a genius but he was in the right place at the right time" one can be disgusted by many salaries (as i am) without therefore concluding that the locus of control should rest with GOVERNMENT that, we can agree on
The problem is excessive Government regulation to begin with. The environmental movement has successfully squashed the construction of any major American refinery since the 80's. Thus, creating a condition of artificial scarcity in the domestic gasoline market. Wanna know who benefits?
not to mention the damage the "no nukes" people have done to our energy sovereignty if it's good enough for france...
Agreed. I'm often telling my Canadian friends that their country really needs to start building nukes. Lots of 'em. Brand new, high-tech, high-yield ones.