Larry Ribstein has been waging a lonely fight (examples here and here) against the politicians and media pundits who think that executives make too much money because . . well, . let’s see, . . because some of them make a lot of money. Or some logic similar to that.
At any rate, Dominic Basulto — who is the editor of the Fortune Business Innovation Insider — observes in this American.com op-ed that the conventional logic on executive pay actually has it backwards. Most executives are underpaid:
In fact, thereís strong evidence that, far from being paid too much, many CEOs are paid too little. Not only do the top managers of multibillion-dollar corporations earn less than basketball players (LeBron James of the Cleveland Cavaliers makes $26 million), they are also outpaced in compensation by financial impresarios at hedge funds, private equity firms, and investment banks. Should we care? Yes. If other positions pay far more, then the best and the brightest minds will be drawn away from running major businesses to pursuits that may not be as socially usefulóif not to the basketball court, then to money management.
Read the entire piece. I wonder what Gretchen Morgenson will say?
