Michael Carpenter, CEO of embattled lender GMAC, was paid $1.2 million for six weeks of work last year. On an annualized basis, this amounts to around $9.5 million. That's pretty nice pay for the CEO of a firm that's majority owned by the U.S. government -- almost equivalent to Goldman Sachs CEO Lloyd Blankfein's $9.6 million compensation for 2009. Should we be outraged?
On one hand, it's a little early to judge just how good a job Carpenter will do in turning around GMAC. Sure, it had a pitiful 2009, but he had only been on the job for those last six weeks of the year. Given that the firm was one of the most troubled to receive federal funds, he has quite a task ahead of him. If he does, somehow, manage to bring GMAC back to profitability and repay the $17.3 billion bailout, then he may be worth it.
Above I said that Carpenter's annualized pay compares similarly to that of the Goldman Sachs CEO. I mentioned that because several sources, including the New York Times, Financial Times and Bloomberg, all highlight that fact. But I think it's a little disingenuous to compare his pay to that of the Goldman CEO. Blankfein made far less money than he would have if his pay wasn't a public relations disaster waiting to happen. If nobody in Washington or the press cared about Goldman, his compensation would easily have been several times greater.