As an avowed capitalist, I take pride when I witness someone rise from virtually nothing to extraordinary financial heights. Like most of us, I put a premium on those who have the talent, skills or intellect to do what few others can. And I believe those rare individuals should be rewarded at whatever level they can achieve. Let's just call it the American Dream.
But I also believe there are those who deserve more. Educators and law enforcement personnel are woefully underappreciated when it comes time to hand out the paychecks. On the other side of the coin, some entertainers and athletes are obscenely compensated even though - in my opinion - they lack that special something that would deserve massive financial reward.
When the dust settles however, I still believe every individual should have the opportunity to achieve financial success based on whatever circumstances they face. I don't begrudge anyone hitting the "lottery" in their profession. I just hope to learn something from their experience.
But I have to admit, I did find some sinister pleasure in watching some grossly over-compensated corporate CEOs break a sweat this week before a House Oversight and Government Reform Committee.
Now as a capitalist and conservative Republican, this would not normally be my cup of tea. But even a capitalist can find some justification in questioning a $120 million compensation package for a manager whose business is in the tank and costing stockholders their retirement income. The word "obscene" keeps surfacing in my mind.
The House Committee brought in the CEOs of Countrywide Financial Corp., Merrill Lynch and Citigroup. You don't have to be an avid reader of the Wall Street Journal to recognize these three companies have taken it on the chin from the mortgage meltdown. And those losses have meant substantial financial pain for the investors - large and small - who put their money and their faith in these companies.
Yet not one of these CEOs shared in that financial pain. Quite the contrary. The Countrywide honcho pocketed $120 million while his company took a $1.6 billion loss. Merrill Lynch losses cost investors $10 billion but their CEO got a $161 million golden parachute. Ditto for Citigroup.
Granted, it's not as simple as the math would portray. These CEOs have complex stock compensation packages that guarantee them a windfall regardless of the company's performance. But tell that to Joe Sixpack as he shells out his paycheck to meet a mortgage payment that has escalated or pays $3.50 for a gallon of gas. You'll find little sympathy as you can imagine.
If you want to know why corporate America is about a popular as a used car salesman - no offense intended to used car salesmen - then you need not look beyond these three CEOs. It's hard for any among us to rationalize why someone deserves that much money while managing a company that is bleeding red ink by the barrel.
Even capitalists get jaded from time to time. Even those of us who want everyone to aim high and to hit their goal find it hard to justify these excesses in the wake of their company's floundering. If achievement is tied to performance, then these guys are toast and everyone knows it.
Coincidentally the Forbes Top Money list came out this week with Warren Buffett and Bill Gates once again neck and neck at the top of the ladder. The difference is that when these two financial giants see their various companies facing troubled times, they suffer along with the investors. Their achievement is indeed tied to their performance. Someone needs to remind those three sweating CEOs facing an unfriendly crowd in a packed hearing room of this primary business axiom.