The Obama administration struck a delicate balance on executive pay Thursday, blaming flawed compensation packages for encouraging disastrous risk-taking but insisting it doesn't want to dictate how corporations reward their top people.The fact that corporate America has put short term gains at the forefront rather than long term health of a company is no particular mystery.
Gene Sperling, a top counselor to Treasury Secretary Timothy Geithner, conceded to a congressional committee that imposing compensation caps on companies could lead to a flight of talent.
"I can say with certainty that nobody in the Obama administration is proposing such a thing," he said.
Yet, at the same time, he and officials with the Federal Reserve and the Securities and Exchange Commission laid out a case for how payment structures rewarded short-term gains at the expense of long-term performance and contributed to the nation's financial crisis.
However, not all companies work that way and it should be noted any administration or government plan to impose a structure is just wrong, on so many levels.