How does the CEO of a company that is down 40% still profit so enormously? (Answer: Because the current tax code was written to encourage such nonsense.) As many have (finally) been saying recently, the US should not be rewarding failures. That is not the capitalism that made the US a great country and the longer Obama avoids addressing this critical issue, the longer it will take to return to greatness. This is not the America I used to know.
The thoughts of restricting the pay packages of the CEOs of public companies may be in the air, but new data on chief executive compensation show that boards of directors are not taking any of it seriously.
Stephen Schwarzman, head of financial firm Blackstone (BX), made over $702 million in 2008 based on data from The Corporate Library.
Schwarzman made almost all of the money on the vesting of shares in Blackstone which he received when the company went public. Blackstone stock is down over 40% during the last two years, but the CEO does not appear to be paying for that.
The most stunning name on the top ten compensation list of 2008 is Michael Jeffries of Abercrombie & Fitch (ANF). Its sales have been falling in double digits for month. Jeffries made $72 million, 86% of that from the exercising of options and vesting of restricted stock. ANF shares are down 55% over the last two years.
