As GE reported to stockholders in March 1997, the company then agreed “to provide [Mr. Welch] with continued lifetime access to company facilities and services comparable to those which are currently made available to him.” As with virtually every big company, that includes access to services that may never be used. But simply listing them all has been the source of great amusement posing as outrage.
The Securities and Exchange Commission quickly promised to waste taxpayers’ money on this non‐issue, since the SEC seems to regard itself as the enforcement arm of the press. The ease of getting the SEC to overreact to every press complaint undoubtedly gives populist reporters a heady sense of omnipotence.
When rehashing such old news, it helps to see what was said at the time. A March 23, 1997 article in The Washington Post began by noting, “If you had bought $100 worth of General Electric Co. stock when Jack Welch first became chairman of the company 16 years ago, your investment today would be worth $2,194.30 — nearly double the rise in the Dow Jones industrial average.” Little wonder stockholders never complained about how much Jack Welch was paid. Mr. Welch turned GE into the most valuable company the world had ever seen, though Bill Gates sometimes gave him a run for that title.
How executives are paid for adding billions of dollars to stockholders wealth is strictly the stockholders’ business, not that of pundits or politicians. Stockholders may or may not want more detailed information about retirement packages than is currently required, but proposing to change such rules does not justify retrospective nitpicking over one particular old agreement. One reporter even feigned indignation that Mr. Welch might earn $17,000 a day for consulting. Would Bill Clinton provide an informal chat for that little?
On Oct. 13, 1996, the New York Times had some remarkably prescient comments on the timing of executive pay: