Michael Kinsley writes at Bloomberg View about Jamie Dimon's compensation:
Let's even imagine that all the paper shuffling and exotic transactions that go on in American finance are productive somehow. Does it follow that we need to pay Jamie Dimon, chief executive officer of JPMorgan Chase & Co., $23 million to do whatever it is that he does?
Maybe Dimon is uniquely talented and simply would not do it for less. But maybe he would settle for $10 million if pushed to the wall. Or perhaps someone just as good, or almost as good, would do the job for a lower price? This doesn't mean that Dimon should be fired and replaced. But it does mean that he doesn't need to be paid more, or even as much.
Mr. Kinsley is using what we call Piketty's We. Again, it's not "we" who are paying Jamie Dimon; it's JPMorgan Chase & Co. shareholders, who have the choice to either own the stock or sell it. The shareholders even have an advisory proxy vote on executive compensation. If Mr. Kinsley owns the shares, he doesn't disclose it in the article. One of the Bloomberg commenters more or less suggests that Mr. Kinsley should apply his own reasoning to his own compensation, cutting his own pay by 57%, and see how that goes. Perhaps some other columnist "just as good, or almost as good, would do the job for a lower price?"
If Mr. Kinsley wants to lead a shareholder revolt or proxy battle on executive compensation practices at JPMorgan Chase & Co, that would be an interesting fight to watch, and, if I were an investor in the company, which I am not, I'd certainly give his arguments a careful hearing. But Mr. Kinsley's argument isn't really framed that way; it's more an argument for the Buffett Tax, in which the government would take away from Mr. Dimon money that the shareholders and directors decide to pay him.
Mr. Kinsley also targets the CEO and founder of Facebook, Mark Zuckerberg:
Facebook's imminent IPO could leave its founder, Mark Zuckerberg, with a fortune of more than $17 billion....Would Zuckerberg not have created Facebook if he only expected to make, say, $12 billion?
The situation here is a little different from Mr. Dimon, because Mr. Zuckerberg's money is based on growth in the value of Facebook shares. Maybe Mr. Zuckerberg would have created Facebook for $12 billion, but would the investors in the venture capital funds that backed it have invested in it, knowing that there were all kinds of risks (remember MySpace?), and that their returns in successful investments would be offset by lots of other venture investments that would be entirely lost? In any event, if the VC investors didn't like how much Mr. Zuckerberg was getting in the deal, they had the choice not to invest.
