http://blog.redfin.com/blog/2008/10/in_the_news_again_redfins_old_friends_in_congress.html Redfin Corporate Blog Sat, 11 Feb 2012 06:50:21 +0000 hourly 1 http://wordpress.org/?v=3.0.1 http://blog.redfin.com/blog/2008/10/in_the_news_again_redfins_old_friends_in_congress.html/comment-page-1#comment-4014 raphael Rosa Tue, 07 Oct 2008 18:46:20 +0000 http://blog.redfin.com/blog/2008/10/in_the_news_again_redfins_old_friends_in_congress.html#comment-4014 We blame "government" as if the government were some sort of living entity, like you, like me. It isn't. Neither is "big business," "big labor" or any of the other segments of our socio-economic polity. Truth is they're all made up of individuals; individuals who act out of either altruism (not many), enlightened self interest (more but still too few), or simple greed (most). Unfortunately our system appears to organize around the greed principle and reward those who are willing to be the most ruthless and Darwinist in their ambitions. The result is that corporate executives become willing to exagerate or lie about financial positions. They bribe (with campaign donations) politicians to end regulations, tax others, etc. We end up with a government we can't trust, corporations that go bust, and a fabulously rich 1% who despite losses, are still so wealthy that they don't care. The answer? Remove the incentive. Place a cap on total executive compensation. Tie exec pay to some multiple of employee total compensation. Pay people to manage, not incent them to cook the books or corrupt government, or ship jobs overseas, or devise arcane debt swaps, derivatives, or other ways of creating fake wealth that must, sooner or later, evaporate when it's realized that there is nothing "real" underpinning the bubble. We blame “government” as if the government were some sort of living entity, like you, like me. It isn’t. Neither is “big business,” “big labor” or any of the other segments of our socio-economic polity. Truth is they’re all made up of individuals; individuals who act out of either altruism (not many), enlightened self interest (more but still too few), or simple greed (most). Unfortunately our system appears to organize around the greed principle and reward those who are willing to be the most ruthless and Darwinist in their ambitions. The result is that corporate executives become willing to exagerate or lie about financial positions. They bribe (with campaign donations) politicians to end regulations, tax others, etc. We end up with a government we can’t trust, corporations that go bust, and a fabulously rich 1% who despite losses, are still so wealthy that they don’t care. The answer? Remove the incentive. Place a cap on total executive compensation. Tie exec pay to some multiple of employee total compensation. Pay people to manage, not incent them to cook the books or corrupt government, or ship jobs overseas, or devise arcane debt swaps, derivatives, or other ways of creating fake wealth that must, sooner or later, evaporate when it’s realized that there is nothing “real” underpinning the bubble.

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