The US government's "pay czar," Kenneth Feinberg, will impose pay caps on hundreds of financial-sector employees, according to recent newspaper reports.
Mr. Feinberg made no effort to conceal the explicity political motives behind this initiative. For example, the numbers he uses are plucked out of thin air. Why a $500,000 cap? Why not a $400,000, or $600,000, or $502,409.95? Why does he want to expand the caps to more employees — was the previous round of pay caps somehow ineffective, and if so, how? Not only has Mr. Feinberg failed to answer these questions, he's failed to ask these questions, because these pay limits are a political exercise.
The strength of the US financial system stems from its independence from government interference. The Obama administration continues to chip away at the disaggregation between government policy and business activities, which argues that the Obama administration does not know or does not care about the consequential inevitable damage to business innnovation.
Topics: · business
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