We talk in this country a lot about “pay for performance” like it’s a thing we actually do and like it’s a perfect system.
Mostly, what we do is pay people what they’ll be desperate enough to accept in exchange for their labor, but that’s not completely accurate either.
We act like contracts are a terrific thing for people like basketball players and CEOs, but they’re a terrible, evil thing when they’re for people like teachers and city engineers. Those, “lesser” people should be judged on their “performance,” often some arbitrary test or scoring system. We don’t mind contracts for artists like musicians and writers, but we want them to settle for the least possible and we still kind of begrudge them a little for “selling out” instead of “staying true” to their art or “doing it for the passion” or some other hokey nonsense.
You know, I caught part of the NBA finals game last night. None of the commentators I heard suggested the players get out there for free out of love for the sport. (Though, plenty of people think the players in the NCAA should do it for free and eat the cost of any resulting health care. Don’t even get me started on health care, but I will say this: a very dear friend is alive today because of “Obamacare” so you bad mouth her having insurance, you’re cut off.) And, given that the first half of the game, the Heat played like a high school team who’d eaten too many pot brownies, if that was the arbitrary test we judged their performance with, they’d have all been fired and replaced with cheaper workers from Indonesia or at the very least some kids fresh out of college who have nothing on their resumes but school projects.
Of course, “but they came back to within seven.” And “but they just had a bad night, you gotta look at the whole season.” (Kind of the same argument teachers gave when everyone wanted to judge their whole “season” on one test three-quarters in that could be affected by roughly 1800 variables per kid. “But, they came closer than they ever have.” “Several of the kids were kept up by a shooting and manhunt in their apartment complex last night.” “Almost half my students are homeless; they’re stressed about other things!” “Look at all the progress and learning we did all year!”)
Now, CEOs you can get rid of on a whim after a bad earnings report or a failure to fire enough workers or whatever. And maybe the bad earnings was due to an excessively snowy winter, which kept more people in and decreased their discretionary budgets. Or maybe the bad earnings was due to a housing bubble burst or a student loan bubble growing.
And so all the pundits dissect the whys and you shake your head and oust the guy. Who has time for excuses, right? Just get rid of them and find another cheaper — oh, wait you plan to pay the next guy MORE? What are you doing? This isn’t how things are done. At least we won’t have to pay this guy anymore. Oh, you mean we have to pay him a massive golden parachute for screwing up? It’s in his contract. Oh, well then. It must be done.
Besides, he’s a CEO so he’s being paid for his prior performance. Or his being special. At any rate, there’s surely some reason the talking trolls on CNBC can come up with that explains why this guy was worth more than the combined salaries of everyone he fired plus a yacht.
We might need that yacht because if we don’t drown from the rising sea levels, we’re certainly going to drown in our own hypocrisy.