Governance vs. envy
Posted by Marc Hodak on September 20, 2009 under Executive compensation, Reporting on pay | 
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The current debate over how bankers should be paid is actually two conversations conflated into one.
The nominal conversation is about elevated concepts, such as corporate governance and systemic risk. The Fed proposal is about regulating “compensation policies deemed to pose a potential threat to a financial institution’s soundness.” In fact, the discussion of governance and risk is simply a front for the real conversation driving public policy—envy, i.e., a less elevated concern about how much other people make and who gets to decide.
Governance, as a distinct topic, is too boring for the media to write about. On the other hand, how much other people make is quite interesting. But raw dollars is too crude a topic for our media elite to claim as an explicit journalistic interest. So the MSM satisfies this interest implicitly by conflating the governance and envy conversations in a kind of bait and switch. The bait is code words like “millions” and “outrage” in the headline or lead. Then, for the next fourteen paragraphs, they will discuss governance and risk, as if those considerations were actually driving policy makers and government leaders to the point where compensation overwhelms the agenda of the upcoming G20 talks. Finally, in the fifteenth paragraph, they will return to the crux of what’s driving the debate:
In the U.S., the Fed’s plan will further inflame the debate between those who feel it bank pay too high [sic] and those who resent Washington’s reach into the private sector.
“Pay too high” is a concern about envy, not governance, but even here the narrative is used to disguise envy by obliquely citing ‘those who feel.’