New mechanism must be wrought to once again allow the owners of the company to control it. Outrageous compensation packages do nothing for the bottom line, nor do they help the shareholders, in truth they diminish profits and reward stupidity and greedy behavior by the management.

Until the widespread corruption in our society is addressed we are merely tilting at windmills. Nothing will change other than appearances and the system will collapse over and over until the Treasury defaults by destroying the currency. This is our future without real change.

A simple metric is the maximum compensation should be a multiple of the lowest paid employee’s wages, and the number should be widely published and approved by the shareholders.

It is obvious by the state of the economy that most of those in power and in control of the state and the financial industries do not know what they are doing and are not worth what they are paid.

But, I suspect that the intent of the Federal Reserve, the Treasury department and the Obama are considerably more sinister than the simple requirement that rescuees submit to the government pay plan. There is a desire on the part of this government (and I suspect this is true of most governments) to control the pay plans of all “publicly held” enterprises. This would essentially be a usurpation of the authority of the boards of directors of these companies, in whose trust the stockholders of the companies place their trust. As such, it represents a “taking” by the federal government of private property, specifically, the right of self-determination by the owners of the company. This “stake-holder value” bull-roar is in itself a usurpation of the rights of ownership, suggesting that a non-stockholder has just as much right to determine a company’s future as the people who put up their risk capital to own the institution. The Federal government is making a concerted effort to insinuate itself into the management of these firms by trying to convince the world that 1) the company has “stakeholders” whose “rights” are as compelling as those of actual stock-holders and 2) that many of these companies are part of an “oligopoly,” that they act in consort, and, as such, illegally, to benefit themselves at the specific expense of the public. Yet, the assertion of the oligopolistic practices has not been demonstrated in court and, therefore, no legal remedies can be enacted. Remember, the due process clause of the 5th ammendment requires that there shall be no takings without “due process of the law.” As such, this is a usurpation of the rights of shareholders and management.

There is a practical consequence to this too. Companies looking to raise money will raise it elsewhere where there won’t be such restrictions on the day-to-day operations of the businesses. If a company lists itself publicly, it will do so on an exchange that will be non- US so as to avoid these silly regulations or, they will operate as privately held entities, where the benefits of stock ownership will not be made available easily to US investors either on a retail or institutional basis. Given the success of the federal government in running enterprises like a retirement system, a health care system, a post office, and a railroad, it’s hard to see how they’ll run a financial service system with any competency. We won’t become like France, we’ll get to the point where the French system will be an upgrade.

I still go back to the idea that if you go to the government bailout, the bond and stock holders have access to previous and future corporate management and board earnings for renumeration. Of course this should be in the courts. That takes the issue out of the government and into the courts where the bondholders and stock holders have some standing.

Again make it as messy as possible to make management assess, take and manage risks. One might question who would take the job. I would respond – honest people who know the business.