Look, there are over paid people in this world. Athletes. Movie stars. Middle managers at large corporations. Sure. I get it. And to a l ot of people, people who really work and work physically, the money that some of the people make is gross. That being said, the market adjusts pretty well and compensates those people fairly well.
Is shoveling horse manure more physically demanding than running a large Fortune 50 account? Yup. Are more people suited to shoveling manure than managing said account? Just as sure. Hence, the value of the skill is different and the compensation changes.
Which just makes this news predictable:
Anastasia Kelly, general counsel of AIG , Rodney Martin, head of one of AIG’s international life insurance businesses; William Dooley, who runs the financial-services division including AIG Financial Products; Nicholas Walsh, vice chairman and head of the international property and casualty unit; and John Doyle, who runs the U.S. property and casualty division, said in written notices Dec. 1 that they’re willing to leave by the end of 2009…
In October, Feinberg cut 2009 compensation for AIG’s top 13 employees by 57%, including limiting most base salaries to no more than $500,000. Another 12 top employees had already left before the review began, according to the WSJ.
Now, you can argue that execs are overpaid. And you might even be able to convince some people of that fact. But what you CAN’T prove is that THESE execs are overpaid in relation to their peers. These people, in theory, are among the best in the world at what they do. There might be only a few hundred who have the ability to rise to the positions these people have. And that is among billions of people. They SHOULD be paid well.
Now they will, just not at AIG.