Executive pay: Fear of falling - The Peninsula, Qatar's Leading English Daily - 6 Jan 2009

DW - it is nice to know that US compensation issues travel well.  From the US to the London to Qatar.

Executive pay: Fear of falling

Web posted at: 1/6/2009 10:6:1

Source ::: FINANCIAL TIMES

Amid
growing anger at lavish compensation packages, Congress is preparing to
legislate against the flawed incentives blamed for US corporate excess,
write Francesco Guerrera and Joanna Chung

Dan
Pedrotty can pinpoint the moment he first saw middle America's rising
tide of anger against the gargantuan pay packages of corporate
executives. It was during the final few days of last year's
presidential campaign and Pedrotty, a union leader, had taken time off
from the AFL-CIO, the giant labour federation, to campaign for Barack
Obama. His job was to call white lower middle-class voters - often
called "Reagan Democrats" for their volatile political allegiances - to
persuade them to elect America's first black president.

From
the other end of the phone, as respondents voiced their fears and
anguish over their ability to cope with the worst downturn in
three-quarters of a century, one issue kept coming up over and over
again. "Executive compensation was front and centre for Reagan
Democrats. I heard that every day," Mr Pedrotty says. "The debate has
fundamentally changed from a shareholder issue to a taxpayers' issue.
The level of anger and incredulousness around the country is at record
levels."

Business
leaders begrudgingly agree. Even Martin Lipton, the influential lawyer
who is one of corporate America's staunchest defenders, acknowledged in
his annual letter to boards of directors that the attention executive
pay is receiving from activists, regulators and the general public has
reached new heights.. Some companies have already reacted to the
country's shifting mood. Most of the banks that went cap in hand to the
government and received billions of dollars from federal coffers have
scrapped executives' bonuses for this year. Some, such as Morgan
Stanley and Citigroup, have even pledged to claw back part of the
bonuses due to traders and other high-flying employees if their bets
turn sour.

The
rest of corporate America is also heeding the message coming from Main
Street. Leading companies such as FedEx, Motorola and Caterpillar have
slashed pay and bonuses for executives. Many others are planning to
follow suit. Three out of four large US companies have already cut, or
are planning to cut, bonuses for their current year, according to a
poll by the consultancy Watson Wyatt. But Americans are demanding more.
Three-quarters of those surveyed in a Bloomberg/Los Angeles Times poll
in early December say banks that have received government money should
cancel all bonuses to employees this year. About half of those say

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