February 18, 2010

Debate Advice #1

You find yourself in a debate with a liberal progressive over the issue of government not having the rightful authority to limit executive compensation. What do you do?

[Read the following paragraph in an imagined William F. Buckley tone]

You are on a weak footing with the casual political observers listening in to begin with. They hate bankers and corporate greed more than they hate government. And after all the mentions of fat cats, you are in the unenviable position of defending the greedy, rich ponzi-scheming leeches you probably don't even particularly like yourself. Despite your reticence you still understand the importance of liberty in the markets and the whole risk-reward paradigm vis-a-vis socializing failure versus it's pronounced effect on innovation.

[End Buckley]

So what are you to do? You've already tried the 'but athlete make millions every year too' argument, only to be thwarted by the argument that their careers are short and they provide more social value than bankers (a dubious claim at best). It's also a typical straw man ploy.

You've got two arguments to counter with still at your disposal. The simpler, less impacting one is that actors and musicians do not have short careers yet still rake in millions. They are not capped. Should they be capped too? Or is entertainment a more important social function that keeping your savings safe and providing mortgages for home owners? There are not millions of people in these executive positions making multi-million bonuses.

Furthermore, we are in a competitive market. Attracting smart business decision makers requires compensating them at market rates. In order to compete with a Swiss bank in recruiting and keeping top talent, an American bank has to pay the prevailing wage (progressives love that term - turn it on them). If the government cuts that by 60% those smart bankers will look for work with Credit Suisse. They may then steal business away from Bank of America. Lost talent, lost innovation and then lost opportunity. The American 'empire' is next to be lost as that effect snowballs.

Maybe progressives won't care. They often don't seem to care about country. So you have to finish by hitting home.

If they can regulate and cap executive pay, and clearly want to do the same with health care, and therefore doctors' pay, why not rodeo clowns and garage mechanics too? And if they can cap those making say over $250k per year, just like taxes, who is to say it will never be adjusted downward? Who among us is safe? Who is next? No one is immune from the slippery slope.

This may not convince the progressives whose ultimate goal may be communist-style pay equity across everyone, but those listening in are sure to take notice.

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