WALLY’S WORLD: When it’s tough, CEOs earn the bucks

Throughout my childhood and youthful adult years, I always was told presidents and chairmen of major, international corporations like General Electric and Bank of America received huge salaries because of the enormous responsibilities they carried.

Throughout my childhood and youthful adult years, I always was told presidents and chairmen of major, international corporations like General Electric and Bank of America received huge salaries because of the enormous responsibilities they carried. I came to believe the survival of such gigantic enterprises – empires, really – were dependent upon decisions these chief executive officers had to make.

Well, as I wrote in another column a few years ago, this is pretty much myth. True, a corporate exec has to make decisions, but rarely are they so critical that the future of the corporation is at stake; that is, the vast majority of decisions corporate heads make are rather routine and paltry so, even if they make the wrong choice, no lasting damage will result – and making these decisions commands an annual salary in the multi-million range, plus stock options. In those few cases where a CEO has to make a decision that’s absolutely critical to a company’s health, they have large staffs of subordinates who will thoroughly research the issue before a choice is made and, after the research, the choice often becomes obvious. In those rare cases when it isn’t and the head honcho makes the wrong decision, much to the corporation’s detriment, the chairman may be forced to resign, which means he simply floats into retirement on a “golden parachute” with an annual income of several million bucks, plus stock options.

Not bad for a screw-up.

Still, corporate execs at least accept responsibility for their mistakes, right? Well, no. Apparently, they don’t even do that.

When Kerry Killinger, former CEO of Washington Mutual, was called before Congress, he said the bank’s failure wasn’t his fault. When asked about the rotten sub-prime loans sold on Wall Street, he denied knowing about them – even though, from 2000 to 2007, the bank made $77 billion off such crappy loans – or he said he couldn’t recall. (To paraphrase an old Mark Twain quip: “According to his best recollection, he couldn’t remember.”) And when he was fired in 2008, he walked away with $25 million in severance pay.

As another example, when Wall Street execs were paraded before Congress, they denied knowledge of the sub-prime mess. They said they didn’t understand what derivatives were. The government regulators didn’t understand either. Apparently, nobody does.

And finally, when the CEOs of British Petroleum went before Congress to answer questions about the Gulf Coast oil disaster, they denied responsibility and pointed the finger at subcontractors, who pointed back at them. And the government regulators were in bed with the corporations. Literally. (Or, at least in bed with the whores hired for the corporate parties in Miami.)

You see, it’s really quite obvious. Nobody is responsible for anything.

So, I think I’d enjoy a job like that. If the board of directors would like to pay me $100 million a year, I’d only be too happy to manage a Wall Street hedge fund, an international banking empire, or any other corporation you’d care to mention. You pick the company. Just give me the money.

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