Justify your salaries, Bush tells US executives

"America's corporate boardrooms must step up to their responsibilities. You need to pay attention to the executive compensation packages that you approve. You need to show the world that American businesses are a model of transparency and good corporate governance."

President George W. Bush
In a speech to Wall Streeters, President Bush gave the above warning to our nation's business executives. He said those executives are under scrutiny for reaping massive salaries, and backdating share options to make them more valuable. Evidently President Bush is not a regular reader of the www.ontheborderline.net (OTLB) blog site. If he were, he would understand this is a free-market and there should be no ceiling on executive pay and, conversely, there should be floor on how little those executives can pay their employees.

Over at OTBL, they've never seen a profit that was obscene. In an OTBL post on 6/21/2006 titled "Minimum Wage Revisited," Mark Pribonic wrote the following:

"But why can’t businesses just pass on the extra cost to consumers? They possibly could; but if every business did that, then the rise in the minimum wage would be offset by the higher prices of goods and services. Thus, negating the effect of any wage gains; real income, the amount a dollar would purchase, remains the same. The rising costs logic also ignores the fact that consumers over time will discover alternatives or substitute goods. For example, the restaurant business employs a good number of minimum wage employees. Passing on the cost of a higher minimum wage to customers will more than likely result in decreasing the number of times an individual will go out to eat. Less business results in less need for employees. By not passing on the additional cost, the restaurant will experience declining profits which again will cause some employees to be laid off. In fact according to the National Restaurant Association, during the last minimum wage hike nearly 146,000 restaurant workers lost their jobs. The consumer is the ultimate driver of employment and wage rates; a fact too often ignored by economic pundits."

Evidently, it is easier to past on the costs to excessive executive pay packages to the consumers. Likewise for the back dating of stock that has been popular in the news of late.

"Government should not decide the compensation for America's corporate executives. But the salaries and bonuses of CEOs should be based on their success at improving their companies and bringing value to their shareholders."

President George W. Bush
From the above quote, it is clear that our President has turned completely into a socialist scum. Perhaps he did get a chance to read this article in the 9/23/2003 issue of Capitalism Magazine by Larry Benson titled: New York Stock Exchange Chairman Richard Grasso vs. Karl Marx .

Concerning executive compensation payouts, Benson points out that "another mistaken Marxist notion is that property is a zero-sum commodity, i.e., if Grasso gets $188 million it comes out of everybody's pocket. But those millions come out of the private pockets of the NYSE owners, not anybody else's."

Evidently, unlike rising the minimum wage, the huge costs of executive compensation packages like Grasso's $188 million or Home Depot Ceo Bob Nardelli's $210 million don't get passed on to the consumer. The fact that executive pay has skyrocketed from 40 times that of the average wager earner to over 400 times the average wage earner isn't what bothers people like Larry Benson. Rather, Benson is disturbed by the fact that these CEOs can't stand up and take their money like a man. Writes Benson:

"The most disturbing aspect of this public lynching of private property is that Grasso, like Jack Welch a year ago, has now caved in to the mob and agreed to forgo millions 'to quell the controversy.'"

"The reprehensible thing about this whole issue is not the amount of money Grasso will get, but the lack of moral courage exhibited by people like Grasso and Welch. Such cowardice hastens the day when we will all be forced to live by the Marxist mantra: 'all property is theft.'"

Looks like President Bush has dumped his dance partners at OTBL. How long will it be before we are reading an OTBL post using the words "RINO, Kitty, Shelia and President Bush" in the same sentence?