Monday, August 27, 2012

Yeah, but...

The Project on Government Oversight (POGO) published an infographic the other day comparing the average CEO compensation at the top five defense contractors to the annual salaries of aerospace and defense industry workers. The average CEO earned an impressive $21.5 million (in, presumably 2010) equating to the total compensation for 268 aerospace and defense industry workers.

Fortunately, the Federal government does not pay or reimburse these contractors anywhere close to $21.5 million per year. Executive compensation is capped by statute at $694 thousand for 2010 and $763 thousand for 2011 so most of this compensation comes out of profits or from the contractor's commercial business. POGO did make a good point though; in the event of a sequestration, that level of compensation would preserve a lot of industry jobs.

While on the subject of compensation, there is still an amendment pending that would lower the executive compensation cap to the annual salary of the vice president, $230,700.

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