I'm giving a talk at the National Business Law Scholars Conference today, The CEO Pay “Problem”: It’s All Marjorie Margolies’ Fault, which reviews Michael Dorff's new book on executive compensation.
Here's the text:
The CEO Pay “Problem”: It’s All Marjorie Margolies’ Fault
It is rare that an issue as complex as executive compensation can be traced to a specific decision by a single person at a precise moment in time, but I nevertheless want to offer up a candidate.
The date was May 27, 1993. The place was the floor of the House of Representatives in Washington D.C. The person was Marjorie Margolies.
Newly elected President Bill Clinton’s first budget was in deep trouble. Every Republican in the House had voted against it, as had a number of Blue Dog Democrats (remember them?).
Congresswoman Margolies had opposed the bill, but changed her mind at the last minute after extended personal lobbying by President Clinton himself.
As Margolies walked down the aisle of the House to cast what became the deciding vote on the 1993 budget, numerous Republican Congressmen jeered "Goodbye Marjorie!,” waving handkerchiefs as though saying farewell to a ship sailing out to sea.
It is a moment that does not appear in Michael Dorff’s estimable new book Indispensable and Other Myths (2014), but probably should have.