Big Babies

Really big frickin' babies! A simple rule. If you want to have sweet private sector autonomy don't take public money!:

Wall Street and the business community gave a lukewarm response Wednesday to the US administration's plan to cap executive pay, fearing it may lead to a talent exodus and delay recovery in the finance sector.

The reaction came after President Barack Obama announced that executives of finance firms taking government bailouts would have their annual salaries limited to 500,000 dollars, a move aimed at protecting taxpayer interests.

The salary limit is "still a hefty sum to be sure, and the spirit of the order certainly has popular appeal, but it's a slippery slope when the government puts restrictions on how much an individual can earn in the private sector," said Patrick O'Hare of the independent research firm Briefing.com.

"Also, the order itself strikes us as a disincentive for financial firms to reach out for aid, which will just prolong the recovery for the sector and the economy."

Douglas McIntyre at the financial website 24/7 Wall Street said the limits could make it more difficult for troubled banks to retain their best executives.

"Wall Street may keep most of its bankers if they face pay cuts, but it is the top five or 10 percent who make these companies really profitable, and they will soon be on their way to greener pastures if this measure is enacted," McIntyre said.

Don Lindner, a compensation specialist with the human resources association WorldatWork, said the new restrictions could mean a "huge cut in pay" for many top executives.

"They might leave to find jobs where they are paid more, that's my concern, that the restrictions are so deep that the leadership won't stay," Lindner told AFP.

Still, Lindner said the matter is "a complex issue" and that "just like any other investor, I think the federal government has every reason and responsibility to protect its investment."

But he argued that the move "may have some consequences," such as "not being able to get the kind of leadership the organizations need to recover quickly."

...John Wilson, an equity analyst at the brokerage Morgan Keegan, said that despite the protests, Obama's step is "the logical political move" after the government stepped in to rescue major banks.

"You can't take on a business partner and not expect them to have some say in your business," he added.