by Brian Pears

Created on: September 24, 2009

This debate is not really a debate. To demonstrate the effect that limiting CEO pay will have on our country, on our economy - even on our American ethical system - let's play out the pro side of this argument.

"Effective tomorrow, by order of the Economic Czar of the United States of America, those listed as CEO of a corporation will be legally prohibited from making more than X."

(Please envision a statesman-like speech emanating from your dream politician, replete with multiple microphones, state-of-the-art PA system, and hordes of sycophantic followers cheering with blank smiles on their faces in the background.)

By now, I imagine you've noticed the "X" at the end of our fearless leader's declaration. The X is the key. What ought the maximum compensation limit be?

Many have taken up this topic, and those foolhardy souls often compare the compensation of American CEO's with the wages of the average worker at the companies they run. That ratio is then butted up against the compensation of European CEO's relative to their employees. As you might imagine, by that comparison, American CEO's are, to a person, all overpaid, underperforming, and one might assume, exceptionally well-fed.

Of course, those making such comparisons will nearly always leave out statistics that do not support their claim, such as profitability measures, productivity numbers, and the like. Those might help explain why our overeating American CEO makes what he does.

But forget Francois and Helmut for a moment. Back to our original issue, how do we determine X?

Should we use some reasonable multiple of the average company employee's compensation? Maybe we'll set it at ten times what the average worker makes. We don't know why we've picked ten, of course. But maybe we were staring at our fingers (or gosh! our toes too!), and a number just occurred to us.

(Sarcastic, yes, but please understand: we have no standards for such a limit. Regardless of how we calculate an upper end, it will be, by definition, arbitrary. So, we might as well poke fun at that fact.)

At this point, let's check in with something colloquially known as The Law of Unintended Consequences. It is not a law per se, as many actions do not result in consequences we could not have foreseen. We humans are smart; we foresee lots. But not everything.

And our utopian worshipers of the number ten could not have foreseen that some CEO's will decide to pay their workers more in order to boost their own salary. After all, a jump in

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