General Motors had a historically successful year in 2011, posting a record $7.6 billion profit. It's a robust turnaround for the once-enfeebled company, which needed a hefty cash injection from the government to avoid going under, and is still partly owned by Uncle Sam. But GM is less sanguine about a new government pay freeze on bailed-out companies, and in announcing its pay package for CEO Dan Akerson, who received a cool $7.7 million in compensation, GM complained that the restrictions "do not permit us to reward our senior executives in a manner reflecting the level of achievement of our business plan." Does Akerson deserve more money?
His pay is quite low for a big-time CEO: Look around the industry, says Joann Muller at Forbes. Akerson's chief rival, Ford CEO Alan Mulally, hauled in $30 million last year. (Ford didn't take a government bailout like GM did.) It's easy to see how government restrictions on pay could hurt GM's ability to maintain its recent success, since its 100 highest-paid employees, all of whom are subject to the pay freeze, could probably find better-paying work elsewhere.
"Is GM's CEO underpaid?"
This whining is the epitome of blind greed: "Forgive me for not shedding a tear," says FiredUpInCa at Daily Kos. GM's complaints about compensation are hard to stomach in a country where millions "would do anything to get even a part-time job flipping burgers, at a minimum wage, just so they can migrate from being nearly homeless to being merely broke." You can't find a better example of the "detachment from actual reality that many one percenters have to this day."
"Government freezes GM CEO's pay"
And pay caps are actually good for GM: The pay restrictions will give GM "much more incentive to return the government's money as soon as possible," says Gutone at Seeking Alpha. All the big banks that relied on government aid returned the money earlier than anticipated so that they could lift the caps on executive bonuses. GM's executives will surely stay around until then — they can expect "a large amount of future income once the government is fully repaid."
"Government freezes CEOs' pay, and why that's a good thing"
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- The 11 worst fast food restaurants in America
- I hate Ayn Rand — but here's why my fellow conservatives love her
- 7 language habits that reveal your age
- Here's the schedule very successful people follow every day
- The biggest lesson Obama failed to learn from Bush
- Why Peter Capaldi has a bigger challenge than any Doctor Who in history
- 7 grammar rules you really should pay attention to
- 7 things the world's happiest people do every day
- A scientific fact-check of 2001: A Space Odyssey
- Why are so many parents being arrested?
Subscribe to the Week