Most of the time, The New York Times does a reasonably good job of covering business matters, but there are still days when the paper resembles the People’s Daily of New York.
Yesterday was one of those days. First, Times business columnist Gretchen Morgenstern — who apparently believes that the model for corporate governance is Ben & Jerry’s — continued her campaign against excessive executive compensation with this Times Select ($) column in which she excoriates the compensation package paid to Analog Devices CEO, Jerald G. Fishman. While disassembling Morgenstern’s article, Larry Ribstein asks a decidedly more compelling question than the one Morgenstern addresses, namely “[t]o what extent do stories like this shape misguided public policy like the SECís recent compensation disclosure rule? What is the social cost of the useless reshuffling firms must do to minimize damage from sensationalist stories like this?

Speaking of those social costs, this Business Week article notes a trend that is certainly consistent with my anecdotal experience — a brain drain at public companies as top managers flee for jobs with private equity funds to hunt for deals and manage portfolio companies:

The attractions are twofold: money and freedom. The pay can be outrageously good even at the entry levels; for CEOs, it can be spectacular. The flexibility is alluring, too. In private equity thereís less annoyance from the Sarbanes-Oxley Act, the controversial regulations passed in 2002 to police publicly held companies. And many private CEOs will avoid the Securities & Exchange Commissionís new proposal that would require the highest-paid executives at public companies to disclose their compensation in excruciating detail. (These rules and proposals still apply to companies that issue registered public debt.)
Regulatory issues aside, the fundamental nature of private-equity work is different. CEOs have a freer hand to do the tough but necessary things to repair companies for the long term, with less focus on quarterly results and placating public shareholders and more on meeting the strategic yardsticks of a multiyear turnaround effort.

Meanwhile, along side Morgenstern’s column on the front page of the Sunday Times business section, this Landon Thomas article reviews the NY Times Bestseller, John Perkins’ Confessions of an Economic Hit Man (Berrett-Koehler 2004), the core message of which is described as follows:

American corporations and government agencies employ two types of operatives: “economic hit men,” who bribe emerging economies, and “jackals,” who may be used to overthrow or even murder heads of state in Latin America and the Middle East to serve the greater cause of American empire. During an earlier time, that message might have been mere fodder for conspiracy theorists and fringe publishers. But now, for all of Mr. Perkins’s talk of fiery plane crashes and corporate intrigue, his book seems to have tapped into a larger vein of discontent and mistrust that Americans feel toward the ties that bind together corporations, large lending institutions and the government ó a nexus that Mr. Perkins and others call the “corporatocracy.”

Can Oliver Stone be far behind?