Why Is CEO Pay So High?



HT: Monty's Bluff

Update: I'm actually not in the "CEOs make too damn much money" camp - the cartoon was something I found amusing, rather than a reflection of my views. Equity Private has taken the time to put together an excellent set of arguments that CEOs aren't overpaid at all (with lots of nice graphs). EP summarizes the arguments here:
...So let's review. Longer term, riskier and more contingent compensation. Lower salaries as a portion of total compensation. Substantially increased legal risk, both civil and criminal. Short-term focus on returns by the short-term focused markets. Add to this a private equity sector that, in terms of total investments in 2005, could buy up nearly 10% of the Dow Jones Industrials, and it becomes clear that the market (in this case composed mostly of institution money) is increasingly counting on private equity as the more efficient deployment of capital over the highly regulated public markets. Keep it up, America. Right or wrong, we private equity folks love the massive flood of senior management talent currently being driven our way out of public companies.
Well done. Read the whole thing here.