It would take months to identify and explain every problem with the government “bailout” — and we probably will have years to experience each and every one of them as the current government attempt to “fix” the economy has the predictable outcome of making things worse.
Today we look at problem number 4,762: the effort to cap CEO pay.
First, we acknowledge that any company that chooses to enter the devil’s bargain of a government bailout is stuck with whatever restrictions the government imposes, no matter how stupid or counterproductive they are. The fundamental rule of reality is the old cliché: He who pays the piper calls the tune.
And we have sympathy with companies that essentially are expropriated, such as some of the banks that Treasury Secretary Henry Paulson decided were in need of government “aid” even though the bank owners disagreed.
Where the Libertarian Party of Georgia draws the line in the sand is at the concept of limiting CEO pay of private concerns. It is true that a lot of the public like the idea (at one time the public believed the sun revolved around a flat earth, too), but this popularity is being driven by the demagoguery of some elected officials who want to be in control of every element of American economic life. We say “No, no, Hell no!”
The Libertarian Party of Georgia platform states “Efforts to redistribute wealth…through the coercive power of the state are incompatible with individual freedom.” Our conclusion is “Government intervention in the economy imperils both that freedom and the material prosperity of all. We therefore support…the repeal of all controls on wages, prices, rents, profits, and production.”
It is our belief that state control of CEO pay would merely be a precursor to government setting of ALL pay rates, which would destroy at least two important aspects of liberty: the right of everyone to enter into contracts, and the right of property owners to control their property. Our platform also states “We…hold that the owners of property have the full right to control, use, dispose of, or in any manner enjoy, their property without interference, until and unless the exercise of their control infringes the valid rights of others. …We…condemn current government efforts to regulate or ban the use of property in the name of…the promotion or restriction of economic growth.“
The only people who should have any say in the payment package of corporate officers are the Board of Directors of individual companies. Once a Board determines a mutually agreeable employment contract with an officer, the only government role is to protect “the Obligation of Contracts” as dictated in Article I, Section 10 of the US Constitution.
The Libertarian Party of Georgia believes capitalism is the most efficient and fair economic system, because it has the best likelihood of rewarding individuals for their ingenuity and labor. The definition of capitalism is privateownership and control of the means of production and distribution. Once government uses regulation to control business, we have crossed the line to fascism, which is the private ownership but state control of the means of production and distribution. (You can learn more about economic fascism inThe Ominous Parallels written in 1983 by a disciple of Ayn Rand, Leonard Peikoff. Prepare to be terrified.)
Politicians are using the issue of CEO pay to drive an agenda of increased government control, which also means diminished personal freedom. Despite the 20th century’s demonstration of the murderous failure of communism, there still are people who believe that socialism would work if only THEY were in charge. Unfortunately, many of them are in the US Congress.
The Libertarian Party of Georgia is unequivocally opposed to government interference in the salary of free individuals who work for private companies.
