Saturday, June 20, 2009

Compensation and risk

In testifying before a hearing of the Senate Subcommittee on Aviation Operations, Safety and Security recently, Roger Cohen, President of the Regional Airline Association asserted that there was no data to suggest any relationship between pilot compensation and the risk accidents due to pilot error.

The same lack of relationship between compensation and risk-taking that puts others in jeopardy seems to exist elsewhere; for example in some large banks and one insurance company. Despite high compensation, the senior managers in the cockpits of some of the nations largest financial institutions were unable to prevent a crash.

We seem unperturbed that those in whose hands we place our lives earn minimum wage, while those who look after the money seem to make more mistakes yet are paid a thousands times better (literally).

Perhaps the banks' shareholders might think about this next time they take a regional flight to a shareholders meeting.

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