October 17, 2009
Obama Pay Czar Kenneth Feinberg is demanding that Bank of America CEO Ken Lewis receive no salary nor bonus for 2009, and will also have to repay the bank the $1 million he’s already earned. Granted that BOA was one of the large financial institutions that received TARP Bailout money, and that the takeover by BOA of Merrill Lynch (for which Lewis had strong reservations) was quite controversial, still, the very idea of a “Pay Czar” is very fascist in nature, like many of President Obama’s policies and proposals. There’s little doubt that it will go from applying to companies receiving TARP money to all businesses, and this kind of government intrusion into the private sector only comes from the resentment and envy of the Left, and control-freak politicians.
A private business, no matter how large, has a right to pay its CEO and top executives what the owners and shareholders think their labor is worth. Many people don’t see what the executives do as “labor,” but that concept includes intellectual as well as physical labor. A CEO doesn’t just sit there at his or her desk looking out the window, but makes very important, sometimes stressful decisions. A lot of pressure, for example, was on Ken Lewis when he was testifying before Congress regarding his misgivings on the Merrill Lynch acquisition. Just one decision by a company CEO can affect millions of people, and billions of dollars. Most business owners and shareholders think that their CEOs’ labor is worth their high salaries.
Likewise, the NFL (in the news a lot this week) values the labor of dog-fighter/dog-executioner Michael Vick and that’s why the NFL hired him back, although fans have been split on that. That reflects more on the decline of values in America in recent years. But Vick’s labor is valued.
When or if the government takes over the entire medical care system, the value of doctors’ and nurses’ labor will decline, along with the quality of care. Already we are seeing doctors planning to retire early or college students deciding against that profession if the government takes over. Those less skilled but who don’t mind being servants of the state will enter the profession as government doctors. The good doctors now are usually those who prefer independence, and who value the confidential relationship between doctor and patient. Doctors and nurses will be paid what government officials, not markets, decide their labor’s value is worth, hence the decline in quality.
We can see how things get devalued when controlled by government bureaucrats. Just look at Fannie Mae and Freddie Mac. And look at the products of government-run (aka “public”) schools.
A further example of that has been the Cash For Clunkers program, with more people trading in their clunkers for foreign made vehicles, because of the decline in the value of American-made cars. That isn’t just because of the government takeover of General Motors, but in large part because the quality of American-made cars has declined over the years, as the labor unions’ workers compensation and benefits packages have greatly increased.
And that situation isn’t because their employers put a higher value on their labor, but because of the unions’ strong-arm tactics and pressures on the auto makers. In contrast, the Americans who work at Toyota plants in the United States, for example, are payed less and, with the exception of at only one plant which is closing next year, are not unionized. Toyota pays American workers the value of their labor, calculated much more accurately according to buyers in the free market and the employers, not an organized labor union.
The value of labor and the products of labor are promoted by freedom and free markets, and downgraded by mobs and government intrusions.