15 Apr 2006
Ex-Exxon CEO's Massive Pension Draws Fire

I don't begrudge "Big Oil" their profits: lately they've had something of a windfall, no doubt, as much due to luck and markets as anything. What I do object to is ripping off their shareholders in such a blatant fashion - more than $150 million to one man. Those are company profits, generated by the capital the owners (shareholders) invested. They should be outraged.

But such is the state of corporate governance in the US, that there's probably little or nothing they can do about it. The longer I live and the more I see of it's operations the more I become convinced that the business form known as "the corporation" is a real enemy of free markets. The abstractions engendered by this form of artificial person with limited liability for the real owners are actually counterproductive to the operation of the market, and in fact lead almost inevitably to oligarchy and cartel.

I note with some interest that in the novels of the famed defender of capitalism, Ayn Rand, none of the Captains of Industry she used as heroes had to deal with Boards of Directors or shareholders at all. And far from bringing democracy into business, corporatism has more often resulted in outrageous excesses like this one.

If we are truly committed to free minds and free markets, I think it's high time we re-examined the basics of business organization, compensation and the linkage between ownership and responsibility.

AP - A $69.7 million compensation package and $98 million pension payout to Exxon Mobil Corp.'s former chief executive and chairman Lee R. Raymond has some shareholders and economists asking, "how much is enough?"

(link) [Yahoo! News: Top Stories]

23:00 /Politics | 2 comments | permanent link