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Is short-sightedness such a new thing?

Investors want payoffs now instead of later.  Individuals are taking on enormous debt to buy now in exchange for forfeiting retirement.  Executives are compromising next year to appease Wall Street next quarter.  Politicians worry about their next term and forget the future of the state.

Was it always this way?
Permalink Michael B 
July 19th, 2007 12:12am
I don't think so.

When Kennedy proposed to send people to the moon, that was a 10 year commitment.

Point being, it's common for people to want immediate gratification.  But it's a sign of maturity to have a better appreciation that larger returns are possible with a longer commitment.
Permalink SaveTheHubble 
July 19th, 2007 12:26am
Back in the 1970s, there was a (federal) change where the management of a company was now responsible to the shareholders rather than to the company. This change turned planning for the future into planning only as far as next quarter's numbers.

We're now on the 2nd generation of company employees who've "grown up" under those rules. That shortsightedness ends up getting inculcated in their children (in the genre of "I can't hear what you're saying, your actions are speaking too loudly!").

The attention span of folks has also been declining. Even movies pace themselves for commercial breaks. That also conditions people to have an attention span measured in minutes. If it can't fit in a 6 minute segment, it won't get put into a Hollywood movie, or at the worst, it will get edited down to 6 minutes or less.

If you want to find someone who isn't shortsighted, then look for someone who does NOT watch American TV.
Permalink Peter 
July 19th, 2007 12:47am
When I am elected President, I'd love to pass the CEO compensation reform bill:
- any stock or options granted to a CEO cannot vest in less than five years
- CEO salaries are capped at 200x the lowest wages paid at the company times a muliplier based on how many corporate employees get benefits
- any form of "bonus" payment cannot be paid if the company does not have a positive net income that fiscal year
- no bonus can be paid if more than 5% of the company's workforce is laid off

Don't like it? Go run a company in Europe.
Permalink Send private email Philo 
July 19th, 2007 1:06am
"no bonus can be paid if more than 5% of the company's workforce is laid off"

YES.
Permalink AMerrickanGirl 
July 19th, 2007 9:10am
Sounds great.

"- CEO salaries are capped at 200x the lowest wages paid at the company times a muliplier based on how many corporate employees get benefits"

I think 100x should be plenty. Especially if you aren't count those stock options, fringe benefits, and various other compensation (like super-low interest corporate loans for multi-million dollar homes and private jets.)
Permalink Send private email JoC 
July 19th, 2007 10:28am
It makes sense that the older you are the shorter your sightedness. Few people can see over the horizon of death.
Permalink Send private email strawdog soubriquet 
July 19th, 2007 11:01am
"I think 100x should be plenty. Especially if you aren't count those stock options, fringe benefits, and various other compensation "

Well, 100x minimum wage is $1M/year, or $800k/year after taxes. The thing is that the range of CEO's is from guys running a 5,000 person company to the CEO of GM. To be absolutely realistic there's got to be room to have a range.

And we're talking about compared to salaries in the eight figure range today, so even a $2M cap is a huge cut.

And I've killed stock options for the first five years, which makes them insanely riskier. Making your stock go up next quarter is easy. Making it higher five years from now is not. [evil grin]
Permalink Send private email Philo 
July 19th, 2007 7:23pm

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