The headline, FDIC eyes linking levies to bank pay, is yet another media sound byte which might be yet another PR stunt with no action.

US banks’ contributions to a multi-billion dollar fund that insures depositors’ savings could be linked to regulators’ assessment of bank pay plans, under preliminary discussions being held by top banking watchdogs.

So, there is no commitment or comment. At least the FDIC is considering such a move, while Congress does nothing.

Meanwhile, Michael J. Cooper, Huseyin Gulen and Raghavendra Rau published a new study, Performance for pay? The relationship between CEO incentive compensation and future stock price performance, which disproves a correlation between executive incentives and company performance. It's so bad, it's almost a negative correlation instead!

Interesting to say the least! So, let's get this right, when one has those CEOs with reasonable and low end compensation, the company performs well, yet those at the top of the pay scale...their corresponding companies loose money.

The average yearly loss in abnormal shareholder wealth for firms in the top decile of pay is $2.39 billion, after paying out an average of $22.7 million in total CEO compensation. The performance worsens significantly over time.

While the paper continues with a host of theories, one can also conclude that executive compensation is now inversely related to shareholders interests.

So, why can we not get reforms on executive pay?

Below is a post written a year ago, Corporate Citizen, an oxymoron, talking about the divergence in corporations interests from the national interest. Now we have a situation where even the corporations interest is diverging from the executive interest.

I suggest reading the entire paper and note, all of the research and study on executive compensation within Academic circles and not a lick of action anywhere.