Presidential hopeful Mitt Romney was asked Tuesday whether he would accept a salary as president, or refuse compensation in the name of deficit reduction.
The chief executive's salary is nothing to scoff at -- $400,000 a year -- but it amounts to loose change compared to the $1 trillion-plus annual federal deficit.
Yet as a symbolic gesture, not drawing a salary might carry significant weight. Romney did something similar as governor of Massachusetts, forgoing a $135,000 salary in the "spirit of volunteerism." And it's not like Romney, who is worth between $84 million and $256 million, needs the money.
But here is what Romney told radio host Neal Boortz:
"Well I don't have an announcement for you on that today ... But I do believe in linking my incentives and my commitment to the accomplishment of specific goals," Romney said. "I wish we had that happen throughout government -- where people recognized they are not going to get rewarded in substantial ways unless they are able to achieve the objectives that they were elected to carry out."
Incentive pay for politicians! We at CNNMoney are excited about this idea. Incentive pay rewards workers based on performance results rather than hours worked, and is a staple of the private sector. (We should note that some research indicates pay-for-performance is not always ideal.)
But back to Romney's salary as president. It seems that Romney might not have a choice in accepting his $400,000 as president. After all, that's what the law says the president must be paid (in monthly installments).
However, Kenneth Gross, a partner at Skadden Arps Slate Meagher & Flom, said nothing is preventing Romney from taking that salary and donating it to charity, or cutting the Treasury a check to help pay down the deficit.
But if Romney is really serious about making a dent in future government spending on his behalf, he might announce plans to forgo all future benefits allowed presidents who have left office. That's where the real money is.
Romney, if elected, is in line for a government pension of around $200,000 to be paid each year. Former presidents are also provided with a staff and office space upon leaving office. Stationery and telephone service is included.
The benefits can really add up. According to the Congressional Research Service, the General Services Agency spent $518,000 on allowances for former President Carter in 2008. Meanwhile, $786,000 was spent on George H.W. Bush while Bill Clinton's allowance topped $1,160,000 the same year.