That would be me, and yes, I am taking up Adam’s challenge to defend Time Warner’s $80 million payment to Robert D. Marcus as compensation for his guiding to completion the sale of the company to Comcast for $45 billion. To state the obvious, Mr. Marcus’s commission was 0.17 percent of the sale price, which would be the equivalent of a real estate agent selling my $200,000 house for $34. If you can find a real estate agent who will sell my house for $34, I’m signing on the dotted line. And if you can find someone who will sell my company for $45 billion and charge me just $80 million, I also won’t hesitate.
It’s just supply and demand. Quite obviously, given the two months that elapsed between Marcus’s appointment as chief executive of Time Warner, and his sale of the company to Comcast, Marcus wasn’t brought in to develop a 25-year growth plan. He was brought in to sell the company. I have neither the knowledge, the contacts, nor the credibility in these elevated circles to shepherd such a deal to closing. Few people do, which is why the price seems high, although it really is quite modest when seen in the big picture.
So, tell me how much Marcus deserved for knowing where to kick the refrigerator. “Well, not that much, that’s for sure.” O.K., so then how much? If the owners of the company are willing to pay that price for a rarified service, why should they not? How would you set a fairer price? Should there be a government commission setting prices for services, and if so, who gets to sit on that commission? And what are your criteria? And what rate will you set for a master plumber, for a hamburger flipper, for a carpenter, for a receptionist at a company with fewer than 50 employees, as compared to a company with 500 employees?
This could get complicated in a hurry.
I’d rather let willing buyers and willing sellers establish their own rates. It’s not as if Uncle Sam isn’t going to get a chunk of it, anyway.
The upshot is that Time Warner employees will continue to earn a good living, if under a different flag, feeding their children and sending them off to college, paying the bills and doing all those things that make this nation the envy of people trapped in much more enlightened cultures where the hand of government is so heavy.
Yes, indeed. Capitalism to the rescue.