“President Bush said he is ‘astounded’ by the size of some executive pay packages and urged companies to tie salaries to performance, while stopping short of advocating government action.
“These compensation packages can get out of hand,” he said in an interview on CNBC. While incentives for performance are necessary, he said, companies should “make sure the incentive pay is rational.” via DesNews
Incentives for performance? Absolutely. Make sure it is rational? Sure. But define rational in relation to pay. Is it $1 million per year or $2 million per year? Maybe it’s $50,000 per year. The point is rational pay is a socialistic ideal because it suggests that one person is smarter than you or me and should decide what is rational pay. What is rational? Rational is letting the free market decide what executives should be paid and not some dude in the White House no matter who it is.
The ironic part of the story is that he also said “One way you become less competitive is through overregulation,” Bush said.
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Well said. Same goes for people that complain about high salaries in sports. If you don’t like them, don’t watch TV, don’t attend games, and don’t patronize the sponsors, but you can’t say that the government should set a cap just because athletes get “paid too much”.
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