What does the dole queue think of golden parachutes?

Photo by Lawrence

A popular song by Frenchman Alain Souchon released last year takes a light-hearted - yet pertinent and topical - poke at executives enjoying their "Golden Parachutes".

The song is gaining in popularity as news of massive payouts and bonuses comes to public attention; executives rewarding themselves handsomely while their humble minions are laid off in droves.

The latest bonus story to hit the headlines is that of former Valeo CEO Thierry Morin, who is looking at a payout of €3.26 million at a time when 10% of the automotive workforce faces the dole queue.

French President Nicolas Sarkozy is refusing to legislate on the subject. But, while calling for a moral rethink of capitalism, he said he will call for a bill to be passed "this autumn" if companies, with their trades unions, can not work out an equitable deal.

 

Contributors

“It’s a scandal!”

French scientist Barthélémy Gamba has been unemployed since August 2008.

Golden parachutes are outrageous and unfair. Firstly, because they drive a wedge between the rich and the poor. Secondly, because the people who get them don't necessarily deserve them.

I am not at all convinced that either their skills, nor their positions merit these kinds of payouts, especially if they have presided over companies that have come close to bankruptcy.

Golden parachutes and stock options add up to pretty much the same thing. Both have the same end result - they create huge disparities in salaries that are not justified.

When Sarkozy talks about a possible bill against golden parachutes, to go into effect in the autumn, I'm convinced it's just public relations waffle.

It isn't what he was elected to do and it won't go in his favour.

On the other hand, Obama was elected to do just that. He says he will do it and he seems to have the will to do so.

Obama's seems to be a more credible response to the crisis. It is certainly less full of moralistic invective.

Furthermore, in this globalised world it is difficult for one country to act alone on issues such as executive bonuses or the equitable distribution of profits.

As for possible legislation, companies should be more transparent on salaries, payouts, bonuses and stock options. It would be a step in the right direction.

Right now companies are obliged to publish their financial results, but many prefer not to and simply pay a fine in order to avoid being too closely scrutinised.

Executive salaries remain a taboo subject even within companies.

"The state shouldn't interfere"

Jeb B., A Franco-American economist, lost his job as a consultant this year. He is a regular contributor to our series on unemployment.

I wouldn't invite someone like Thierry Morin (CEO of auto supplier Valeo who is looking at a 3.26 million-euro severance package) to my table! It is a great shame that the CEO of a company that fires people should have a golden parachute like that. I can understand the anger prevalent in France.

In the US, some CEOs have decided to reduce their salaries to a symbolic one dollar. It is a fine example of solidarity with their employees.

But one should distinguish between golden parachutes and stock options. I am all for stock options if there are democratically distributed.

It can be an excellent motivational tool as it incentivizes new talent and exploration into new markets.

I can not imagine that the state would go so far as to legislate on this subject. The state should not interfere on a subject like this.

I say bravo that Sarkozy has spoken out on this issue. But in any case his hand was forced...

But I don't think governments should get involved in these negotiations.

There is a risk: if there are limits placed on income, the best managers will simply leave and seek more lucrative employment elsewhere.

Each company should make its own decisions. But they should all exercise more transparency. There is a moral imperative for it.

There is already some transparency, especially with France's - and the world's - biggest companies, but all companies could - and should - take this one step further.

 

"Parachute doré" the song

Alain Souchon's song on the subject, "Parachute doré".

Comments

I am in agreement of stock

I am in agreement of stock options but not golden parachutes. In no way should the government interfere. The problem is that we are too reactionary. Every time a crisis hits, the pendulum swings the other way until we go overboard. The moral values of the society needs to change - not the system.

Blame the Bonuses Interview Friday 27 March 2009 France 24 TV

wonderful Programmes like Blame the Bonuses Interview Friday 27 March 2009 France 24 TV fail to have any meanignful impact coz it does not reach a maximum number of people and fails to mobilise mass response to such wonderful information content.

France TV should enable viewers to be able to download such programmes if not for free which would gain the maximum distribution, then at least for a moderate fee.

Any advice on how we could obtain copies PLEASE

Alain Souchon - Parachute dore

This obviously great song in French should have had English sub-titles

can it be recorded downloaded for free

Obama's seems to be a more

Obama's seems to be a more credible response to the crisis. It is certainly less full of moralistic invective.

..You are completely and totally ignorant of the lies and severe damage Hussein has done to America,how is stealing your future generations money anything but immoral?,go ahead,punish your bankers and financial institutions,watch them leave to another country lol,you moral ppl are so eager to steal from someone else on "moral grounds" ha,youre hypocrites'''

Obama = FAIL

...watch them leave to another country...

The model you defend has failed. Your wish to revive it is a dream. Let them leave to an other country? Which country?... The financial in which we are does not work and has never worked. Who as stolen who? The cold and factual analysis shows that the bankers the one who concentrate all the financial wealth have stolen the workers, and you defend this system? The propaganda in which you have fallen, and the dogmas of the financiers and politics, is what has brought us where we are and is what is making solutions to emerge. About the golden parachutes? I see no need for laws, I see a need to come back to the pre-Reagan policies on high revenues. 70% to 80% was the taxation rate from the end of the recession to the end of the 70s for very high revenues. And that was goo times! No?

bailout plan for the USA.or any other country.

I love this plan!
This was an article from the St. Petersburg Times
Newspaper on Sunday. The Business Section asked readers for ideas on "How Would You
Fix the Economy?" I thought this was the BEST idea. I think this guy nailed it!

Dear Mr. President,

Patriotic retirement:

There's about 40 million people over 50 in the work
force; pay
them $1 million apiece severance with three stipulations:
1) They leave their jobs. Forty million job openings -
Unemployment fixed.
2) They buy NEW American cars. Forty million cars
ordered - Auto Industry fixed..
3) They either buy a house or pay off their mortgage-
Housing Crisis fixed.
All National financial problems fixed!!!

Close