How Much Is Too Much

Normally, the people who attract the most ire when proxies bloom are executives who get big bucks for running crummy companies with doggy stocks. But this year, thanks to Walt Disney Co. chairman Michael Eisner, who seems to have been trying out for the role of the little-known eighth dwarf, Greedy, people are starting to focus on the packages of executives whom Wall Street loves–folks like Eisner, Roberto Goizueta of Coca-Cola, Jack Welch of General Electric and Ted Turner of Time Warner, all of whom have presided over huge increases in shareholder wealth.

Their records notwithstanding, the four horsemen’s compensation packages strike even a free-enterprise fan like me as excessive. What else do you call it when you give a billionaire like Goizueta an extra bonus and $1.85 million of incentive pay? Or when Ted Turner, who already owns $2.3 billion of Time Warner stock, gets options to buy 2.5 million more shares? The point of bestowing options on executives is to give them incentive to get the stock price up. But do these guys, who own stock worth nine or 10 figures, need more options or other incentives? Give me a break.

Let’s start with Eisner, whose package is, to be polite, ridiculous. As you may know, Eisner recently got stockholders to approve $196 million of stock options for himself at the same time Disney disclosed that it had paid about $90 million in cash and options to have Michael Ovitz vacate its presidential suite after less than a year on the job. Maybe Eisner figured that if an executive flameout was worth 90 million bucks, a success like himself is a steal at a mere 200 and change.

Before we proceed, let me explain briefly why executive options are worth big bucks. Eisner’s options give him the right (but not the obligation) to buy 8 million shares of Disney at fixed prices over the next 15 . So he benefits if the price rises, but doesn’t lose money if it falls. Using a formula that measures the value of such options, Disney estimates Eisner’s options were worth $196 million when he got them.

Combine that with the $8.65 million in salary and bonus Eisner got in the year that ended last Sept. 30, and you’re over $200 million. It’s in two different Disney fiscal years, but who cares? It’s one thing to realize $200 million of profits, which Eisner did a few years ago when he cashed in options he got in 1984 when he was hired to fix the then struggling company. But getting $200 million of options is a whole other thing.

Because Disney stock has risen about 2,400 percent during Eisner’s reign, ““we’ve never had a complaint from the shareholders at any annual meeting until this one,’’ Raymond Watson, chairman of the Disney board of directors’ compensation committee, said in an interview. ““My view is that this is an at-risk contract [for Eisner], and it’s very favorable for the stockholders. That’s all I care about.''

Now to Coke, whose stock-market value has risen to $150 billion from $4 billion when Goizueta took control 16 years ago. ““Obviously, Goizueta has enough money,’’ said Herbert Allen, president of Allen & Co. and chairman of Coke’s compensation committee. So why did Coke pay the boss $7 million in cash in 1996 and about $25 million of stock options in 1995? It’s part of an elaborate incentive plan for 7,500 employees, Allen said, ““and he’s worth the money.''

GE has released only a preliminary proxy, so I have to guesstimate Welch’s 1996 take. He got stock options worth about $10 million, and I’m betting his salary and bonus were in the $8 million to $10 million range. So call his package $18 million to $20 million. Less than the $25 million or so he got in 1995, but still enough to keep him off food stamps when he retires. GE declined to comment. So did Time Warner.

The moral? To Wall Street, these guys are gods who can’t be overpaid. To Main Street, though, this isn’t pay for performance; it’s just plain piggery.

title: “How Much Is Too Much " ShowToc: true date: “2023-01-08” author: “Pedro Viviano”

When I started practicing the animals were in the backyard, and then they worked themselves onto the back porch and then to the bed until they are an integral part of the family,” he says. The changing relationship with our pets and the great advances in animal medicine mean we are able to and want to give Boo Boo and Fido care that was unimaginable 20 years ago. (It’s also created a $31 billion pet care industry). Unquestionably the lives of our pets are better today.

What my friends were really asking, however, was a valid question for all pet owners. How much treatment is too much? When do we stop putting our pets through painful procedures and giving them multiple medications, many with their own side effects? Just because we can now spend thousands of dollars on tests and exotic treatments for our pets, should we? Do they increase the quality of the pet’s life? Those were questions as Boo Boo and I entered the marble hallway of a multi-story medical complex in north Dallas, a temple to the latest in veterinary treatment. It should have been called the Mayo Clinic for Pets and I cringed when I realized the facilities and quality of care were probably superior to the emergency room I had taken my father to a few weeks earlier.

After a liver biopsy and various intensive stomach tests, the doctor pronounced Boo Boo’s diagnosis: Inflammatory Bowel Disease. He did not have cancer, and changing his diet and administering oral steroids would eventually help control the symptoms.

But Boo Boo’s plight was not over. The tests themselves had exacerbated some of his earlier problems and he began a rapid decline. Too weak to eat, he shed several pounds. His breathing was shallow and rapid. He seemed to be slipping away. I had to consider whether it was time to let him go or to continue treatments that might possibly cause him pain.

During one particularly bleak visit, his doctor brought out jars of human baby food to see if she could tempt Boo Boo to eat. Lying on the examination table, he began to lick the food, then eat it. The doctor firmly said it was clear Boo Boo hadn’t given up and neither should I. After hand feeding him for more than two weeks, his strength began to return.

Now his test results are practically normal. He seems happy, purring as he sits in my lap or stretches in the sunlight. Mercifully, the litter box issues are no more. Those few weeks also cost me close to $5,000. And Boo Boo’s health does depend on taking six pills every day for the rest of his life. “Is the best and latest treatment always the best? I can’t say that it would be across the board,” says Marc Bekoff, an animal behaviorist at the University of Colorado, Boulder. “Being able to afford to do the best treatment available in and of itself is not always a compelling reason. We need to look at individual cases but I do think our animals tell us at some point their life isn’t over and I don’t mean that in some la, la, mystical way.” Boo Boo wasn’t ready to go–even if he is probably ready for me to stop calling him by such a silly name.

title: “How Much Is Too Much " ShowToc: true date: “2023-01-08” author: “Pedro Viviano”

title: “How Much Is Too Much " ShowToc: true date: “2022-12-19” author: “Tonia Miller”