Who's going to get in the way if we try to change the rules of the game? The players, naturally.
The system produces an immoral result because it is in the interest of immoral actors to keep it that way. I have no confidence whatsoever that any reforms will make it past them.
Which players are going to aggressively lobby for this? Only ones who are in the early stages of declaring bankruptcy (not the deepest pockets). Whereas creditors (big banks) probably have more sway, and would benefit from chapter 11 to be weaker.
What you're saying is intellectually lazy and bordering on /r/conspiracy. You shouldn't stop identifying, understanding, and petitioning to fix the problem simply because you think you might get some pushback.
> Which players are going to aggressively lobby for this?
Corporate executives, of course. It is in their interest to ensure they maximize their benefit at all stages of the business life cycle. Any attack that could negatively affect executive compensation at any time will be staunchly opposed, out of principle.
Their arguments we can anticipate, we have seen already in this thread: the business needs their unique talent and deep knowledge, they are doing the business a favor by not jumping ship, it is only just that they be compensated...
> What you're saying is intellectually lazy and bordering on /r/conspiracy. You shouldn't stop identifying, understanding, and petitioning to fix the problem simply because you think you might get some pushback.
I believe the more fundamental problem is mythologizing of corporate executives, and I am not afraid of pushback, such as I am receiving in this very exchange.
I think you overestimate how many executives think bankruptcy "could happen to them." It's almost as if you are mythologizing them as some omniscient, conniving villains. In any case, this is a very strange justification for doing nothing (instead of advocating to fix chapter 11).
There is a very high correlation between board membership and CEO experience. Who decides CEO compensation? The board. The players are making the rules and they're choosing rules that favour themselves.
Hertz insiders control less than 1% of voting shares. You will see similar numbers amongst most of the other older companies doling out executive bonuses.
They did not have any power to grant themselves the bonuses. Keep in mind their overall compensation with the retention bonuses might still be significantly lower than their expected compensation pre-bankruptcy, due to the stock portion of their comp being near worthless now.
Every member of Hertz board has been in a Cxx position with most of them having been CEOs [0]. Some of them may want to be CEOs again someday so it's in their best interest to keep executive compensation high.
Who's going to get in the way if we try to change the rules of the game? The players, naturally.
The system produces an immoral result because it is in the interest of immoral actors to keep it that way. I have no confidence whatsoever that any reforms will make it past them.