This Cato report on Federal Reserve employee pay is interesting because it shows the significant differences between government and private company compensation practices. I urge you to read the article; it’s not long.
One could argue that they have all these really bright economists working away in the Federal Reserve system which would raise the pay scale, but perhaps you didn’t know that they have (as of 2009) about 17,000 employees. So, it is probably a fair comparison.
The 12 regional bank presidents (apostles?) do OK: average pay is $340,323. There are 1,183 “officers” in the Federal Reserve system with an average salary of $198,960, up 94% from 1995. What a great place to work! And, you get to make money in the literal sense.
Now the really interesting question is whether they have automatic inflation adjustments to their salaries. They are going to need them.
Maybe they should put them on a performance based compensation package: say relative to the performance of the US dollar, or the unemployment rate or maybe economic growth less inflation….. Wait, they wouldn’t make any money! It wouldn’t be fair that an organization can fail so miserably at their stated objectives and not be able to pay those responsible for all their “good work”.
Oh, I just thought of another way: we could treat them like Hedge Fund Managers and pay them a big percentage, say 95% of all the annual federal surpluses. Or would that be the Treasury’s performance we should incent for that, how about the Senate and Congress while we’re at it… This is a capitalist economy after all, next thing you know they’ll all want pensions and benefits…
Sorry, I digressed.
I really like the incentive idea.
The salary is nothing compared to the opportunity to front-run the markets, if you know what monetary policy will be before it’s announced.
Reminder, the “Federal Reserve” is NOT a Goobermint Agency. It is a Privately Owned for Profit Corporation.
RE
Yes, you are correct. OTH, it is really a quasi-governmental org and studies show they go along with every administration to get along.
Actually, the way I would phrase it is that every Administration goes along with the Fed in order to get along. If they don’t, they end up like Lincoln and Kennedy.
RE
Yup. It’s all the Illuminati, mass conspiracy and vampires.
Call it Occam’s Razor meets Buffy the Vampire Slayer.
RE
[...] Federal Reserve Paychecks Soar (The Daily Capitalist) [...]
They paved the way for Wall Street’s bonus orgy and felt left out so they said hell it’s just fiat money let’s have a go at pocket stuffing for ourselves.
“The New American Way.”