Corruption in the private sector?
I've just read an article about executives of private companies who keep giving themselves huge pay raises while their companies are loosing money left and right and perhaps are approaching insolvency. Here is an example:
"Rick Wagoner, CEO of General Motors Corp., announced earlier this month the company had to close four plants that make trucks and SUVs because of lagging demand as fuel prices soar. That followed the posting of a $39 billion loss in 2007, a year when its stock price fell by about 19 percent, without adjusting for dividends.
And Wagoner? His pay rose 64 percent, to $15.7 million."
If politicians were lining their pockets with taxpayer money like that. Then everybody would be up in arms. But when corrupt managers part investors from their money. Then nobody seems to care.
Is privatized corruption somehow more ethical and good than corruption within the government?
- Anonymous1 decade agoFavorite Answer
It is not exactly correct that no one cares. I care. And yes there are a great many over paid CEOs. Wagoner is by no means the worst. Here are just a few others: Stanley O'Neil 22 million at Merrill Lynch. He does not work there any longer after Lynch posted a rather large multi-billion loss, but what the heck he still got his millions and of course the stock holders got the shaft. But wait, I am not done yet. Angelo Mozillo of Countrywide Financial 69 million. He may yet wind up in jail and Bank America wind up with the company. Why they want it I have no idea. Countrywide is facing multimillion in lawsuits. But Mozilio did haul away a truck load of cash. But wait, I am still not done. James Cayne 28.5 million as CEO of Bear Stearns. What about that? Richard Fuld 122.7 million as CEO of Lehman Brothers while the company racked up billions in losses. What a racket? Now for the granddaddy of them all. Richard Fairbank 250 million as CEO of Capital One Financial. Oh well, at least the company is making money. Maybe what I should say is that the company is reporting that they are making money. There might be a corrolation between pay scale and corporate performance. The worse the performance the higher the CEO pay.
Here is the best part. I just read somewhere that the average CEO pay increased 15% this year. Nothing was said about their perks. They probably increased 50%.
One CEO did manage to loose his job because of stock holders unhappyness with his pay package. Robert Nardelli of Home Depot. But wait, he got a $210 million severance package. Imagine that. Now he is CEO of Chrysler. Good luck Chrysler.
- TC3Lv 41 decade ago
Yes, there is less of a public position. We need the government, and when people within government abuse that power it impacts more people who rely on them. A greater crime, a greater sin