Hopefully, for these bankers' own interests, greed does not produce genius. When those stressed out Wall Streeters get their triple bypass surgery, they'll be trusting their lives to brilliant cardiothoracic surgeons earning a median wage of $424,000 nationally and only $516,000 if they practice in New York City. In fact, the Medtronic (MDT) clinical specialist engineer who developed the medical devices that may be implanted toiled happily for only $70,000 with a possible bonus of $18,000! That even makes the modest pay of the finance professors who trained these financial Masters of the Universe look pretty good.
Hugely successful CEOs of great firms ranging from UPS (UPS) to Costco (COST) love their jobs and take very modest salaries. Marketing genius Roger Enrico of Pepsi (PEP) never took his salary as CEO, donating it to Dallas school children. Turnaround star Bill George of Medtronic regularly declined the salary increases encouraged by his board. If the fallen financiers are really so brilliant and want high rewards, they should welcome the Obama pay plan as it will reward their successes.
Perhaps this is why it has earned praise from such unexpected voices as Jack Welch and CNBC's Larry Kudlow. If financiers choose to leave their institutions, they should start their own. Steve Jobs hasn't taken more than a dollar a year in salary and other founders such as Bernie Marcus of Home Depot (HD) always took modest salaries. These leaders become multi-billionaires by stock incentives that would reward great performance much like what is offered to financier in the Obama plan. This harkens the old Smith Barney tag line "We make money the old fashioned way, we earn it."
Jeffrey Sonnenfeld, the Lester Crown Professor of Management Practice at Yale, is the Senior Associate Dean of the Yale School of Management. He is also a member of the board of directors of TheStreet.com, which publishes this Web site.
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