I can’t believe I’m doing this, but I’m actually siding with the millionaire CEO on this one :

New York Atty. Gen. Eliot Spitzer sued former New York Stock Exchange chief Richard Grasso on Monday, alleging that the man once celebrated as the public face of Wall Street used deception and intimidation to take home at least $100 million more in pay than he was entitled to.

The lawsuit portrays Grasso as stockpiling the NYSE’s board of directors with his allies, then misleading them about the extent of his compensation.

Grasso, who became chairman and chief executive of the world’s largest stock exchange in 1995, was forced out in September after it was revealed that a month earlier he had been paid $139.5 million in bonuses and retirement benefits accumulated almost entirely since 1999, and that he was owed $48 million more.

The disclosure capped a public outcry over executive pay levels and sparked added furor because the NYSE, as a regulator of most of the nation’s biggest companies, had been cracking down on similar perceived abuses in corporate America.
. . .
Spitzer criticized the NYSE’s previous board, which included the heads of Wall Street’s biggest brokerages, for inadequate oversight. But he said he didn’t take action against the full board because it wasn’t shown all of Grasso’s pay data.

Don’t get me wrong, I don’t support Grasso per se, but I think this case is largely meritless.

The key question here is “Did Richard Grasso break the law?” Despite the list of charges brought against him (stacking the Board of Directors with his buddies, misleading people about his compensation, being an arrogant and overpaid dickhead), I’m not completely convinced that his actions weren’t of the “evil, but perfectly legal” variety which savvy executives are well-known for. Just because the business world (thanks to extraordinary public outcry) has buyers remorse over his pay package doesn’t mean that he didn’t steal that money fair and square.

Furthermore, I think this could likely weaken the fight against corporate corruption by turning into one of those “a few bad apples” situations and therefore obscure the extent of the problem. The horrible thing about this whole situation isn’t that the business world is full of criminals, but that the business world if full of people doing things that should be crimes.

(To give one quick example : The fact that it’s legal to be both CEO and Chairman of the Board of a corporation is absolutely insane. The whole point of the board of directors is to keep an eye on the executives and make sure they aren’t screwing the shareholders. Allowing the CEO to be in charge of the group that oversees him/her is like letting George W. Bush be President and Chief Justice of the Supreme Court.)

So while it may be more satisfying to see rich dudes get hauled away in handcuffs, we should be fighting for changes to the laws that make this crap legal in the first place. We shouldn’t automatically assume there’s a criminal element to every instance of executive malfeasance. Our response to this sort of thing needs to stop being “Why are they allowed to get away with this?” to “Why is this legal?”