First, pay limits at AIG? Wha? Why isn't this company out of business yet? Do we still need them to launder the US Government money being funneled to all those other Wall St. firms (yes Goldman, that means you)?
The plan, for the 25 top earners at seven companies that received exceptional help, will on average cut total compensation this year by about 50 percent. The companies are Citigroup, Bank of America, American International Group, General Motors, Chrysler and the financing arms of the two automakers.Some executives, like the top traders at A.I.G., will face tight limits on their pay.
Alex Tabarrok at Marginal Revolution laments (and I don't think he's kidding):
There is no way this will work as advertised. If the administration actually follows through, most of these executives will quit and get higher paying jobs elsewhere.He may be right that this won't work as advertised, but is there really any need to desparately hang on to the management team that walked your company right up to the edge of the cliff and then pushed it over?