Not Even Marginal

A reader asks Paul Krugman good questions about the compensation of Exxon's CEO Lee Raymond:

The Anti-Green Monster, Money Talks: Readers respond to Paul Krugman's Apr. 17 column, "Enemy of the Planet"

Howard J. Wilk, Philadelphia, Penn.: Businesses defend the wages they pay on the basis that those wages are determined by the free market: Wal-Mart defends its low wages as sufficient to get the number and quality of the employees they need. However ethical or unethical, this is not unreasonable. But businesses fail to apply the same logic to executive compensation. ...

This is not the free market directly at work. What would Raymond have done if his compensation over 13 years had been, say, $586 million a year instead of $686 million? Would he have jumped to another company? I don't think so. Would he have not worked as hard? I don't think so. Would this diminished compensation have deterred present or potential executives from seeking advancement or employment? I don't think so. So what did the stockholders of Exxon Mobil get for their extra $100 million? I think, nothing. [column]