Carly Fiorina weighs in on the Obama administration’s executive pay cap of $500,000. Via CNN:
I don’t think (the pay cap) is the answer, although it is an understandable reaction. It’s arbitrary: Why not $400,000 or $600,000? It’s incomplete. It only applies to institutions that will receive more government assistance going forward. And it doesn’t strengthen our economy when government decides how much each job is worth. In America we leave that job to markets.
So what’s the answer? To strengthen transparency, all aspects of CEO pay and perks should be fully disclosed on a regular basis. This should include airplanes, cars, golf-club memberships, bonuses, stock options, retirement plans and salaries — in short everything that a common-sense person would consider part of a CEO reward package.
To strengthen accountability, all aspects of CEO compensation should be voted on by shareholders on an annual basis.
Ultimately, it is the owners of a company who must determine whether a CEO’s rewards are justified by a CEO’s performance. And because the American taxpayer is now a partial owner in many companies, the government can get a vote as well — in some cases a very sizeable vote.
In addition, “clawback provisions,” which require a CEO to return compensation to shareholders if promised results aren’t delivered, should be standard fare.
She makes some valid points, but I can’t look beyond the notion of Carly Fiorina, who boasts one of the worst reputations of any former CEO, talking about what any “common-sense person would consider part of a CEO reward package.” She needs to stick to talking about superdelegates and conservative backlashes.