He claims he didn't know it was wrong. Yea right.
To be fair people completely devoid of empathy often don't know why causing suffering is wrong. Until it happens to them at least.
Barclays CEO pay slashed after he tried to identify whistleblower
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Re: Barclays CEO pay slashed after he tried to identify whistleblower
#32Is anyone ticked that for an article about Barclays and Banking, I get a video talking about Trump's "town hall"?
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#33This is a good example of why CEO pay is wrong. In any normal job, if your salary gets "slashed", you quit your job. Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
> Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
No, for a number of reasons.
1) His alternatives today could be substantially worse than when he started. If for no other reason, because of this mistake.
2) There may be large switching costs to changing jobs, and the reduction in salary may be non-substantial in comparison. This switching cost was a sunk cost when he initially joined, but will not be if he chooses to switch now.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#34This is a good example of why CEO pay is wrong. In any normal job, if your salary gets "slashed", you quit your job. Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
If anyone ever pays a traffic ticket, it means taxes are too low. Consider: after paying the traffic ticket, they still show up to work! That means they would have shown up to work even if they had paid that money anyway, in the form of higher taxes. This means if anyone ever pays a traffic ticket, for doing something wrong, it logically follows that everyone's taxes are too low. Otherwise how can they afford to pay…
EDIT: downvotes, but no graph, I see. The simple fact is the gparent comment's suggestion is wrong. An elementary sketch of a supply curve would show that it is simply not a good argument. I guess rather than read what I wrote, people voted it based on political ideology. That doesn't make the economics suggestion true.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#35Earlier quoted context omitted.
Most CEOs are dramatically overpaid.
Overpaid relative to what? Your estimation of perceived value? What do you define as value? How would you even begin to empirically establish what you're saying? Executive compensation is a construct of market consensus, not an absolute based on individual performance. The tangible value contributed by chief executive staff is one component of the compensation package, and what is valuable to the board or shareholder…
There is little free market influence on public CEO salaries. Most CEOs can heavily influence board composition, as well as reward board members who please them. This divorces their salaries from market prices.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#36Earlier quoted context omitted.
"Absolutely standard" for whom? What percentage of the workforce even has one, excluding $50 gift cards and other such token gestures?
I'd assume most tech workers. Most that i'm personally aware of 'bonus' have an individual performance multiplier attached. Can get * 2 or * .5 depending how well you (and/or the company) performed that year.
Even for tech workers I'm not sure I'd describe it as standard; maybe it's different in different markets or particular fields.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#37This is a good example of why CEO pay is wrong. In any normal job, if your salary gets "slashed", you quit your job. Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
> Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working? No, for a number of reasons. 1) His alternatives today could be substantially worse than when he started. If for no other reason, because of this mistake. 2) There may be large switching costs to changing jobs, and the reduction in salary may be non-substantial in comp…
Both of your points are symptoms of the problem that CEOs are vastly overpaid.
People are too picky choosing CEOs because they falsely believe that CEOs' high pay correlates to a large difference in performance from regular peasants. The truth is that many, many people could do a CEO's job. Everyone makes mistakes, this CEO's colossal mistakes are case-in-point.
If we stopped falsely believing that CEO's are magical superhuman lords in a world of serfs we would reduce their pay. Switching costs would reduce dramatically. So would our intolerance for mistakes that are naturally part of the human predicament.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#38This is a good example of why CEO pay is wrong. In any normal job, if your salary gets "slashed", you quit your job. Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
If anyone ever pays a traffic ticket, it means taxes are too low. Consider: after paying the traffic ticket, they still show up to work! That means they would have shown up to work even if they had paid that money anyway, in the form of higher taxes. This means if anyone ever pays a traffic ticket, for doing something wrong, it logically follows that everyone's taxes are too low. Otherwise how can they afford to pay…
A traffic ticket vs. what this CEO did are so different that your analogy doesn't make sense. A traffic ticket has nothing to do with employment.
If a Wal-mart employee steals a candy bar they're going to be fired. This CEO who has the luxury of keeping his job when he does something much worse than stealing a candy bar.
Your analogy is a strawman because it has little to no relationship to what we're talking about.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#39Earlier quoted context omitted.
If anyone ever pays a traffic ticket, it means taxes are too low. Consider: after paying the traffic ticket, they still show up to work! That means they would have shown up to work even if they had paid that money anyway, in the form of higher taxes. This means if anyone ever pays a traffic ticket, for doing something wrong, it logically follows that everyone's taxes are too low. Otherwise how can they afford to pay…
EDIT: downvotes, but no graph, I see. The simple fact is the gparent comment's suggestion is wrong. An elementary sketch of a supply curve would show that it is simply not a good argument. I guess rather than read what I wrote, people voted it based on political ideology. That doesn't make the economics suggestion true.
Your economics isn't wrong. The idea that the economics of a traffic violation is relevant to the economics of a workplace misdeed is wrong.
Re: Barclays CEO pay slashed after he tried to identify whistleblower
#40Earlier quoted context omitted.
If anyone ever pays a traffic ticket, it means taxes are too low. Consider: after paying the traffic ticket, they still show up to work! That means they would have shown up to work even if they had paid that money anyway, in the form of higher taxes. This means if anyone ever pays a traffic ticket, for doing something wrong, it logically follows that everyone's taxes are too low. Otherwise how can they afford to pay…
A traffic ticket vs. what this CEO did are so different that your analogy doesn't make sense. A traffic ticket has nothing to do with employment. If a Wal-mart employee steals a candy bar they're going to be fired. This CEO who has the luxury of keeping his job when he does something much worse than stealing a candy bar. Your analogy is a strawman because it has little to no relationship to what we're talking about.
I was specifically responding to this:
>Doesn't this undermine the argument that CEOs need outrageous salaries to be incentivized to work, if you slash their salary, and they keep working?
You say, "if you slash their salary [AS A PUNITIVE MEASURE!!!] and they keep working", doesn't this undermine the argument that they need to be paid that much?
In very precise economic terms, no it doesn't. That is the answer to the question you just asked. Don't shoot the messenger, please.
Please realize that you asked a mathematical statement about microeconomics, which I answered. You asked this specific question: "if they keep working if we slash their salary, doesn't this undermine the argument that they need to be paid this much" and the answer is "no it doesn't."
You will probably grossly misinterpret this but suppose that you are among a group of exploitative managers who pay employees $1.17 per day. The way this is set up 0.17 is a bonus, $1 is the base payment. José, one of your best workers, has been showing up half an hour late every day. Finally you have had enough of this and say, "José, due to this lateness we are reducing your pay to only $1.13 per day next month." The following month José comes on to work on time, and starting the month after his $1.17 is reinstated.
Next at the next manager's meeting, the evil version of YPCrumble makes the same logical mistake that you just did. The evil YPCrumble twirls his mustache and says: "I noticed that José came to work on-time all this month, though he was ony being paid $1.13 due to being so late every day last month. But he came on time. So doesn't this undermine the argument that workers need to be paid $1.17? Since they are also willing to work for $1.13."
Let's step back from the MORALS. Does José's coming to work for $1.13 prove that the plant's 1,000 workers would work equally well for $1.13 that they do for $1.17? Couldn't the plant save $4 per day by slashing everyone's pay from $1.17 to $1.14?
Very simply NO IT DOESN'T. The fact that José showed up to work for $1.13 every day in no way, shape, or form show that $1.17 was too high. It is a simple and precise false microeconomics statement to say that it does imply this.
I am not making a political statement, just answering your question.