John Cole astutely pointed out how the opening monologue from the 2000 film "Boiler Room" perfectly captured the get rich quick mindset that brought our economy to it's knees.
I read this article a while back, that said that Microsoft employs more millionaire secretary's that any other company in the world. They took stock options over Christmas bonuses. It was a good move. I remember there was this picture, of one of the groundskeepers next to his Ferrari. Blew my mind. you see shit like that, and it just plants seeds, makes you think its possible, even easy. And then you turn on the TV, and there's just more of it. The $87 Million lottery winner, that kid actor that just made 20 million on his last movie, that internet stock that shot through the roof, you could have made millions if you had just gotten in early, and that's exactly what I wanted to do: get in. I didn't want to be an innovator any more, i just wanted to make the quick and easy buck, i just wanted in. The Notorious BIG said it best: "Either you're slingin' crack-rock, or you've got a wicked jump-shot." Nobody wants to work for it anymore. There's no honor in taking that after school job at Mickey Dee's, honor's in the dollar, kid. So I went the white boy way of slinging crack-rock: I became a stock broker.
The biggest problem our economy has is shortsightedness. Too many people are interested in making a fast buck. An entire nation consumed with that mindset is a recipe for disaster. Nowhere is this get filthy rich quick at the expense of others mindset more problematic than on Wall Street.
As Robert Reich put it:
Wall Street compensation has been geared to short-term bets on high-leveraged investments, after which players quickly collect any winnings and run for cover. Many Streeters grew rich in the process but most of the rest of us are undeniably poorer.
The delayed compensation strategy Obama instituted this week was a step in the right direction to remedy that problem. The half million dollar salary might be a little too low to attract the most competent leadership for bailed out institutions, but something had to be done to assure that the money we give to failed companies isn't siphoned off by CEO's to maintain lifestyles lavish enough to make royalty blush. Obama's plan didn't institute any "caps" on pay (I would have a serious problem with the plan if he did). He just delayed the CEO's compensation to assure their pay is dependent on long term success.
I don't typically agree with Barney Frank, but I think he is on the right track with his notion that limits should be put on compensation for any firms issuing stock. If there is a minimum wage we should have a maximum wage. The maximum wage should be set somewhere between 300 and 700 times the minimum wage (roughly $5-$10 million/ year). Firms should be free to compensate beyond the maximum wage, but compensation would have to be in the form of stock that can't be redeemed for at least a decade.
Incentives for work and increased compensation should be universal throughout the workforce. All workers from CEO's to janitors should be working towards the same goal: long term success of their employer. Leaders of institutions should not be rewarded for short term success with compensation packages so large that it creates an incentive make huge sums of money in the short term while risking the long term health of the institution.
The long term success of this nation is dependent on us transforming our culture from one that values a get-rich-quick-scheme above all else into one that values others well being ahead of personal profit. Normally pursuing the profit motive has a near universal positive effect on others well being, but the way we compensate the highest earning individuals in this country is screwed up. If the boards of directors that should be overseeing the distribution of corporate profits aren't willing or able to remove the incentive for leaders to raid corporate coffers at the risk of other shareholders the government needs to step in and help ensure that executives managing the firms that keep our economy moving are looking out for the interests of the rest of us as well as they look after their own.
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