Regulate Executive Salaries

Source: The American Prospect

Source: Seeking Alpha

Comment: The graphs above indicate that executive salaries have exploded. I would suggest that they have been changed by Boards of Directors, under the pressure of the stock market, to promote profit seeking. As we should know, there is a trade-off between risk and average profits. It occurs to me that an unintended consequence of the profit seeking was an increase in risk accepted by the private sector. After a long period of growth, the risk seems to have gotten out of hand. Moreover, the social impact of many corporations simultaneously increasing their risk exposure has led to a serious global recession. So let us regulate executive compensation, making sure that it does not encourage excess risk to maximize profits. JAD