The Chief Executive Pay Act

[Nbadan]

Sen. Clairre McCaskill gets her voice...


q7CznXB_wuA

....bong at 59 sec alert...

[boutons_]

I can't see how the govt can limit private company salaries. Just make them pay effective income tax back where it was in 1970s, and with no cap on FICA (which is not progressive, but is capped for the top earners).

However, TARP and friends should have had strings cancelling all bonuses for senior mgmt for 3 years and "disgorgment" of bonuses for previous 3 years.

Crony Paulsen would have said, as he did about other strings, that strings would have dissuaded participation in TARP. I say, then "fuck 'em all to hell".

btw, avg share of national income DOUBLED for the Top400 under dubya.

Top400 now averages income of $263M per year, and pay an effective income tax rate of 17%. They are the group that understates their income more than any other group.

But all we hear from the dumbfucks on this board is how the poverty class doesn't pay any taxes.

[Purple & Gold]

These guys should be thrown in jail for embezzlement. Ridiculous the sums of money that they stole. It's criminal and they need to serve time.

[TDMVPDPOY]

i thought shareholders vote who and how much directors get paid like bonuses...cause i keep on gettin proxy letters about yes/no should directors decide how much bonuses are paid?.....i always tick no, it should be base on performance and capped imo......

[Purple & Gold]

I can't see how the govt can limit private company salaries.

When the public is footing the bill like with the bailout they can put whatever limits and conditions they want. And if the bank is willing to just fold rather then adhere to those conditions, the government is well within their right to just seize it if they feel that it's a necessity.

[louie1674]

I'm really getting sick and tired of hearing everyone saying that tax payers are giving banks and businesses a bailout. The Gov't is stealing my hard earned money, I do not recall ever having a vote on this... If it were up to me I would want to keep my taxes, I think tax payers would do a better job at stimulating the economy.
On the other hand, I do not mind CEOs getting bonuses. Gov't was stupid enough to steal our money and give it to these guys w/o strings attached. If you do not like it, do something. Stop doing business with these businesses. Also call or email your local representative and complain of this outrage, get the power back to the people - they need your vote.
I feel better, thank you for your ear (or eyes).

[SnakeBoy]

They shouldn't limit their pay. They should just let the market purge itself of bad businesses like it wants to. They think "Too big too fail", the market thinks "Too big to succeed".

[Wild Cobra]

But all we hear from the dumbfucks on this board is how the poverty class doesn't pay any taxes.
No. That's all dumbfucks like yourself hear.

Those who are not paying taxes should not have a say in how my tax dollar is spent!

People like you just want a legal method to steal from people like me!


These guys should be thrown in jail for embezzlement. Ridiculous the sums of money that they stole. It's criminal and they need to serve time.
Problem is, they didn't break any law that we know of.


They shouldn't limit their pay. They should just let the market purge itself of bad businesses like it wants to. They think "Too big too fail", the market thinks "Too big to succeed".
That's why there should be no bailout except after bankruptcy. The government cannot require the companies to renege on contracts. that can only be done with bankruptcy.

[SnakeBoy]

Those who are not paying taxes should not have a say in how my tax dollar is spent!

Not exactly how the framers looked at it. Besides, can you name anyone who isn't paying any taxes?




That's why there should be no bailout except after bankruptcy.

Huh? Why a bailout after bankruptcy?

[TDMVPDPOY]

what the govt shouldve done was either buy out the derivatives banks gamble on or,

start govt spending into infrastructure...create jobs....

govt spending doesnt have a trickle affect down to other fields imo.....only certain fields benefit from it....

[Wild Cobra]

Not exactly how the framers looked at it. Besides, can you name anyone who isn't paying any taxes?

I didn't say they don't, I said they shouldn't.

Obviously my opinion, right?

Social Security and Medicare are insurances. Not taxes. Many people pay no income tax.

[TDMVPDPOY]

I didn't say they don't, I said they shouldn't.

Obviously my opinion, right?

Social Security and Medicare are insurances. Not taxes. Many people pay no income tax.

Dude this only works if there is enough funding and users who dont rort the system on both sides, cause it is seen as a burden to the budget......

[Wild Cobra]

Huh? Why a bailout after bankruptcy?
I don't like a bailout there either. If we do a bailout though, let's do it after the CEO's have to take it in the shorts. It's insane to do it without having the power to force restructuring

Our congress is insane.

Actually, this proves they are corrupt. They know exactly what they are doing. Making us even more reliant on them!

[TDMVPDPOY]

i dont think bailing out bankrupt companys is a good idea.....

let the creditors and shit chase down these directors and ceos to recoup their money....

[Winehole23]

No. That's all dumbfucks like yourself hear.

Those who are not paying taxes should not have a say in how my tax dollar is spent!

People like you just want a legal method to steal from people like me!You were so keen to flame boutons that you didn't notice your underlying agreement with him. Do you notice when people agree?


Problem is, they didn't break any law that we know of.Generous.The FBI still gets to have their say on this.



That's why there should be no bailout except after bankruptcy. What SnakeBoy said. Did you think this through at all?

[Winehole23]

I don't like a bailout there either. If we do a bailout though, let's do it after the CEO's have to take it in the shorts.We're having a bailout so banks don't go bankrupt.

p.s., your mean streak is showing.


It's insane to do it without having the power to force restructuringIt's insane to do it when private money has already done it, or is about to do it.

WC: Are you sure you're not thinking of nationalization, where we straight up buy and control it?



Our congress is insane.The beginning of your post was confused, but here you fall right off the edge. Don't try to hit a home run with every sentence, dude. It's ok to say something boring now and then.


Actually, this proves they are corrupt. They know exactly what they are doing. Making us even more reliant on them!Non-sequitur.

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[ClingingMars]

I'm really getting sick and tired of hearing everyone saying that tax payers are giving banks and businesses a bailout. The Gov't is stealing my hard earned money, I do not recall ever having a vote on this... If it were up to me I would want to keep my taxes, I think tax payers would do a better job at stimulating the economy.
On the other hand, I do not mind CEOs getting bonuses. Gov't was stupid enough to steal our money and give it to these guys w/o strings attached. If you do not like it, do something. Stop doing business with these businesses. Also call or email your local representative and complain of this outrage, get the power back to the people - they need your vote.
I feel better, thank you for your ear (or eyes).

+1

(also I love the FairTax)

[SnakeBoy]

I didn't say they don't, I said they shouldn't.

Obviously my opinion, right?


No representation without taxation? Hmmm, I don't think that slogan will trigger much of a revolution, but good luck.

[Spur-Addict]

They're not idiots, they're criminals.

[ElNono]

We live under a fiat currency system. If the government allows two or three of the big banks to fail, then people freak out, and start pulling out their money from the banks.
This is known as a bank run. The thing is, there's not enough money to repay every deposit. FDIC or not. Chaos obviously ensues, followed by government having to do really fucked up stuff, like limit withdrawal amounts, or freeze withdrawals altogether. If you want to read up on a real world example of this, look here:
Argentina's Corralito (http://en.wikipedia.org/wiki/Corralito)

Now, if you could bankrupt those banks in an orderly fashion, then there wouldn't be a problem. But unfortunately, in crisis times like these, you can't do that. And you can't let your entire financial system collapse in a whim.
Personally, I don't like bankers any more than the next guy, but not bailing some of them out, the real big ones, was basically not a realistic option.
What went really wrong is not to attach strings to them. If we would have, then you could have done a orderly liquidation of those that did not want to change or turn things around. Honestly, I don't mind paying premium for a person that really does an incredible job, and helps you succeed... the problem here is paying for complete and utter failure.

[Winehole23]

Now, if you could bankrupt those banks in an orderly fashion, then there wouldn't be a problem. But unfortunately, in crisis times like these, you can't do that.There's the nationalization route, but apparently we prefer to overpay for crap, and cede all control to insolvent banks.


And you can't let your entire financial system collapse in a whim.Hasn't collapsed yet. Maybe the rumors of its inevitable demise are somewhat exaggerated.


Personally, I don't like bankers any more than the next guy, but not bailing some of them out, the real big ones, was basically not a realistic option.I'll agree it was never seriously considered. You can't be sure it's a worse option than throwing trillions of dollars at the problem, and hoping it will go away. Coin flip either way IMO.


What went really wrong is not to attach strings to them. If we would have, then you could have done a orderly liquidation of those that did not want to change or turn things around. Honestly, I don't mind paying premium for a person that really does an incredible job, and helps you succeed... the problem here is paying for complete and utter failure.Paying to help the f****rs who wrecked us. Talk about moral hazard. If you're too big to fail, the public will backstop your insane bets.

Do we have to pay again, if the bailout doesn't take?

What's the policy on do-over bailouts? AIG? Citigroup?



Receivership is a bitch, but we only have to pay the bill for it once.

[SouthernFried]

US govt in debt up to ears...but wants to increase it's spending exponentially to "fix" those "other" idiots who can't run their business right.

Yeah...what a great idea.

My idiot brother maxed out his credit cards, and can't even make minimum payments. Who'd a thunk that the way to handle all his debt...is to create even more!

Who knows...mebbe I'm the idiot for limiting my debt. If the geniuses in DC think that overspending when you can't pay what your owe right now, is how you handle economic hard times...who am I to buck the trend?

Gotta give my bro a call...mebbe he can find a banker, or congressman, to loan him money for that Hummer he's been looking for...

so it goes....

[SnakeBoy]

There's the nationalization route, but apparently we prefer to overpay for crap, and cede all control to insolvent banks.


When I say let them fail that's basically what I mean. Let the government temporarily take control of insolvent banks and orchestrate their liquidation or recovery. Something along the lines of what Sweden did. Sure the shareholders got wiped out but such is life.

I don't think anyone who says let them fail means for the government to just stand back and let mass chaos rule the day.

[Winehole23]

When I say let them fail that's basically what I mean. Let the government temporarily take control of insolvent banks and orchestrate their liquidation or recovery. Something along the lines of what Sweden did. Sure the shareholders got wiped out but such is life.It worked for Sweden (http://www.nytimes.com/2008/09/23/business/worldbusiness/23krona.html) -- hell, it worked for us: RTC (http://www.fdic.gov/bank/analytical/banking/2005jul/article2.pdf), hello? -- but apparently Obama and Geithner are more concerned it may make us look bad if we take over our insolvent megabanks. So instead, we're letting them take us over. Our job is to throw money into a black hole until the banks are solvent again. Theirs is hoard all the money until the cure works. I can wait to see how that turns out. Hopefully, transferring CDS and other toxic crap to the US balance sheet will change the calculus decisively for the banks.

[ElNono]

There's the nationalization route, but apparently we prefer to overpay for crap, and cede all control to insolvent banks.

Nationalization might not have been an option. Remember that some banks were entirely reluctant to enter in the TARP program, even if it meant their own demise. In a country like the US, shareholders will definitely not stand pat while the government appropriates and liquidates their shares. We're not in Sweden, and a hostile takeover like that can really send a bad signal to our 'free market' message to the rest of the world (stronger than the bailout did). You also have to think that the bankers do yield a fairly big hammer. They can unilaterally declare bankruptcy and the ensuing chaos is surely to cause a political coup of major proportions. Again, real world example in the post linked in my previous message.


Hasn't collapsed yet. Maybe the rumors of its inevitable demise are somewhat exaggerated.

It hasn't collapsed because the government handed out money like nobody's business. I'm not really sure a good amount of banks would have made it through without the bailout.


I'll agree it was never seriously considered. You can't be sure it's a worse option than throwing trillions of dollars at the problem, and hoping it will go away. Coin flip either way IMO.


I agree. I actually think the proper way to go about this would have been to spend the bailout money to delay the demise of any bigger bank if they couldn't recover. You let the smaller banks fail, and the bigger ones get the accounts from them and hopefully get on a recovery path. If any bigger bank is still failing after a period of time, your bailout money should have a string attached allowing the government to liquidate.


Paying to help the f****rs who wrecked us. Talk about moral hazard. If you're too big to fail, the public will backstop your insane bets.

Do we have to pay again, if the bailout doesn't take?

What's the policy on do-over bailouts? AIG? Citigroup?

Receivership is a bitch, but we only have to pay the bill for it once.

It's not about paying... it's about having conditions with the money you hand out. I think the problem back when the original bailout came out is that you either bail them out, or the bottom would fall off. Time was of essence and I don't think you could sit down and negotiate with every bank out there. But this should definitely be the time to do that.

[Winehole23]

Nationalization might not have been an option. Remember that some banks were entirely reluctant to enter in the TARP program, even if it meant their own demise. In a country like the US, shareholders will definitely not stand pat while the government appropriates and liquidates their shares.You win some, you lose some. Fuck the shareholders. Their banks bollixed up our financial sector.


You also have to think that the bankers do yield a fairly big hammer. They can unilaterally declare bankruptcy and the ensuing chaos is surely to cause a political coup of major proportions. Again, real world example in the post linked in my previous message.The problem is that the FDIC can't cover the tab for the deposits. If the banks, as you say, have a gun to our heads, so much the better to DECLARE DEFAULT and pull them apart. If you have a bank holiday, there's no run on the bank.


It hasn't collapsed because the government handed out money like nobody's business. I'm not really sure a good amount of banks would have made it through without the bailout.
Some guys at the Minnesota Fed don't think so:

http://www.treasuryandrisk.com/Issues/2009/February 2009/Pages/Follow-the-Money.aspx



I agree. I actually think the proper way to go about this would have been to spend the bailout money to delay the demise of any bigger bank if they couldn't recover. You let the smaller banks fail, and the bigger ones get the accounts from them and hopefully get on a recovery path. If any bigger bank is still failing after a period of time, your bailout money should have a string attached allowing the government to liquidate.This seems ass-backwards to me: what good can come from feeding healthy banks to sick ones?




It's not about paying... it's about having conditions with the money you hand out. I think the problem back when the original bailout came out is that you either bail them out, or the bottom would fall off. Time was of essence and I don't think you could sit down and negotiate with every bank out there. But this should definitely be the time to do that.Now that we're on the TARP do-over, yeah. I agree. Give the deal some teeth.

[Winehole23]

It is assumed that absent the original TARP, the economy would've imploded. Something similar is said about the stimulus bill, and TARP 2.0. Almost all the smart people say so.

It is also taken for granted that the orderly path of default, nationalization and reorganization/liquidation will destroy the economy.

Why are their unexamined, unsupported presumptions taken as so obviously true?

Don't bailout positives have to show their work, too?

[SnakeBoy]

In a country like the US, shareholders will definitely not stand pat while the government appropriates and liquidates their shares.

Without government help, they are wiped out anyway so I don't see where they have a leg to stand on. I think the message to the market would be reassuring and there would be plenty of private investors willing to pick through the scraps. The actions thus far have only caused people to put their money on the sideline while they wait to see what becomes of this trainwreck.

[TDMVPDPOY]

dude when you invest into shares, you know what you were getting into....they are high risk investments...negative gearing is a biatch if you dont know what you are investing into....dont expect the govt to bail them out.

Even the safest investment like deposits is not even safe if a bank goes broke....and its capped how m uch you get back from the govt.

[Winehole23]

Back to the OP, how is the bid to limit private salaries progressing? I hear bonuses were down 44% this year.

[Winehole23]

http://www.mcclatchydc.com/251/story/61216.html

[ElNono]

You win some, you lose some. Fuck the shareholders. Their banks bollixed up our financial sector.
Those guys are also the ones that run our political system too. What they say, goes. I was under the impression you were fully aware by now. And they don't act on their own. There's a reason the top 5 or 6 bankers were all on the same meeting with Paulson when they were negotiating the TARP.


The problem is that the FDIC can't cover the tab for the deposits. If the banks, as you say, have a gun to our heads, so much the better to DECLARE DEFAULT and pull them apart. If you have a bank holiday, there's no run on the bank.
Been there. The banking holiday (and I lived through a couple) is pure fantasy. Once a bank like say Bank of America says they're done, everybody and their mothers starts to pull money out from every bank and move it to gold, etc.
You can call a 3 day holiday, and the 4th day every account holder will be right in front of the bank asking for their money, and people from other banks too.
Believe me, the slope is very slippery and things fall apart real fast. Further, people demand the goverment to do something, but as we already stated the FDIC can't really cover all the withdrawals. It's political suicide to whoever party is in power.



Some guys at the Minnesota Fed don't think so:

http://www.treasuryandrisk.com/Issues/2009/February 2009/Pages/Follow-the-Money.aspx


I'll comment on this later when I actually get to read it. Thanks.


This seems ass-backwards to me: what good can come from feeding healthy banks to sick ones?
Small banks were not any healthier than bigger ones. They also invested in junk mortgages. The difference is that some didn't make it. A good case is Sovereign Bank, that had to be sold to the Santander Group.

[Winehole23]

Those guys are also the ones that run our political system too. What they say, goes. I was under the impression you were fully aware by now. And they don't act on their own. There's a reason the top 5 or 6 bankers were all on the same meeting with Paulson when they were negotiating the TARP. I have a rational understanding of how things work, and then I have my emotional reaction to it. It pisses me off. It makes me talk crazy.


Been there. Please, do tell.


The banking holiday (and I lived through a couple) is pure fantasy. Once a bank like say Bank of America says they're done, everybody and their mothers starts to pull money out from every bank and move it to gold, etc.
You can call a 3 day holiday, and the 4th day every account holder will be right in front of the bank asking for their money, and people from other banks too.
Believe me, the slope is very slippery and things fall apart real fast. Further, people demand the goverment to do something, but as we already stated the FDIC can't really cover all the withdrawals. It's political suicide to whoever party is in power.Sounds reasonable, but again, I have to accept somebody else's word this is true.


I'll comment on this later when I actually get to read it. Thanks.I believe you. But in the spirit of candor I will also relate that 49/50 people fail to return. C'est la guerre. Bon chance.


Small banks were not any healthier than bigger ones. They also invested in junk mortgages. The difference is that some didn't make it. A good case is Sovereign Bank, that had to be sold to the Santander Group.My own casual reading does not support this, but I may be wrong.

I appreciate your detailed reply, ElNono.

If you have other links, would you mind sharing them?

Thanks.

[TDMVPDPOY]

small banks are not in the same situation as the big banks cause there stakes in the same investments are not exposed that much......

ps. lol at those mortgages who locked in fixed home rates.....variable rates looks good now, i think it can go lower.....

[ElNono]

I have a rational understanding of how things work, and then I have my emotional reaction to it. It pisses me off. It makes me talk crazy.


I feel you. I certainly feel the same way. Unfortunately, at some point you have to accept the reality we're living in.



Please, do tell.


Well, I can tell you I was living in Buenos Aires in the late 80's when we had the hyperinflation, and they had to add 3 zeros to the currency there in order to devalue it. In a matter of months, you went from having the equivalent of 10 dollars to having the equivalent of 1 cent of a dollar.
By early 2000, when the corralito hit, I was already in the US. However, my family lives over there, and what they did with that was terrible. Most people lost all their life savings. The President at the time had to resign and escape the government house in a chopper because people wanted to lynch him. That party has not won an election since (there were 2 presidential elections between then and now). In a way, it changed politics so much that what used to be a two party system like here in the US, turned into basically a one party system, and that has serious consequences for democracy in the long term. While the economy eventually hit rock bottom, and from there you can only go up, it set the country back institutionally for decades to come.



Sounds reasonable, but again, I have to accept somebody else's word this is true.

Back when the corralito hit, and even before then, you had two different reaction from bankers. They either played along with the government if they wanted to stay in the country (Most banks in that case), or left the country altogether (Scotia Bank comes to mind). The problem is that bankers are the very first to know what's going on in their system, so they systematically cheat. In the corralito case, most banks moved their money off shore before the crisis hit, and told their biggest customers to do the same, aggravating the problem. All the while, they were telling the middle class that there was no problem and that they should deposit more.



I believe you. But in the spirit of candor I will also relate that 49/50 people fail to return. C'est la guerre. Bon chance.


I got myself some time this morning and read it. And while the numbers do all looked rosy, this is the part that jumps at me: “Maybe Bernanke and Paulson had information that they were not making public, but the available data simply did not support what they were saying.”

And my suspicion is that bankers had all this crap 'assets' they wanted to get rid of, and basically pressured the government for the bailout. What if they don't get it? Then they would all close doors and let the government deal with the crash. Bankers don't work alone. They work in concert. As I told you earlier in this post, there's more than economical consequences to bank runs. I'm sure Paulson felt the pinch, and acted accordingly. The other theory is that the bankers acted in concert with the government in order to get bailed out, without threats. I believe the answer is there somewhere in between.
And whatever the reason, no bailout = no banks = economic/political crash.



My own casual reading does not support this, but I may be wrong.


A lot of people didn't even know some of these deal went on. My boss actually is a Sovereign Bank customer (and so am I), and he didn't even know that the sale went down. He only found out now, many months later, that the Bank reflected it on their web page.

Here's a link about it:
http://www.theyeshivaworld.com/article.php?p=24573

And here's a link from the NY Post about the disadvantages small banks in general got into when the bailout happened, from around that time:
http://www.nypost.com/seven/09232008/business/cant_bank_on_it_130371.htm

[Winehole23]

I feel you. I certainly feel the same way. Unfortunately, at some point you have to accept the reality we're living in.No, thank you.

For the moment I prefer to join the ranks of the fantasy battalion denying this reality. :lol


In a way, it changed politics so much that what used to be a two party system like here in the US, turned into basically a one party system, and that has serious consequences for democracy in the long term. While the economy eventually hit rock bottom, and from there you can only go up, it set the country back institutionally for decades to come.Um, thanks for sharing this.


Back when the corralito hit, and even before then, you had two different reaction from bankers. They either played along with the government if they wanted to stay in the country (Most banks in that case), or left the country altogether (Scotia Bank comes to mind). The problem is that bankers are the very first to know what's going on in their system, so they systematically cheat. In the corralito case, most banks moved their money off shore before the crisis hit, and told their biggest customers to do the same, aggravating the problem. All the while, they were telling the middle class that there was no problem and that they should deposit more.Diabolical.



I got myself some time this morning and read it. And while the numbers do all looked rosy, this is the part that jumps at me: “Maybe Bernanke and Paulson had information that they were not making public, but the available data simply did not support what they were saying.”I'd not be surprised if there's a trove of information that's never discussed in public.


And my suspicion is that bankers had all this crap 'assets' they wanted to get rid of, and basically pressured the government for the bailout. What if they don't get it? Then they would all close doors and let the government deal with the crash. Bankers don't work alone. They work in concert. As I told you earlier in this post, there's more than economical consequences to bank runs. I'm sure Paulson felt the pinch, and acted accordingly. The other theory is that the bankers acted in concert with the government in order to get bailed out, without threats. I believe the answer is there somewhere in between.The threat is tacit in any case. Appears to have worked this time.


And whatever the reason, no bailout = no banks = economic/political crash.I just don't see how you can have a realistic evaluation of the problem when you rule out default and nationalization at the very outset. I'd be very surprised if this policy theme was completely played out.


And here's a link from the NY Post about the disadvantages small banks in general got into when the bailout happened, from around that time:
http://www.nypost.com/seven/09232008/business/cant_bank_on_it_130371.htmThe way I read it, the article says the bailout puts otherwise sound small and regional banks at a competitive disadvantage. With hundreds of billions recently poured into the system, how could this not be the case?

[doobs]

http://news.yahoo.com/s/afp/20090204/bs_afp/useconomyobama




WASHINGTON (AFP) – President Barack Obama Wednesday clamped a half million dollar salary cap on executives of stricken finance firms who ask taxpayers "hat in hand" for bailouts, in a new bid to tame Wall Street excess.


The president also promised that the Treasury would next week unveil a new strategy designed to free up frozen credit markets, in a bid to ignite lending and consumption as the worst economic crisis since the 1930s bites.


"What gets people upset -- and rightfully so are executives being rewarded for failure, especially when those rewards are subsidized by US taxpayers," Obama said at the White House.


"For top executives to award themselves these kinds of compensation packages in the midst of this economic crisis is not only in bad taste -- it's a bad strategy and I will not tolerate it as president."


Under the new rules, bosses of companies benefiting from support from various kinds of the Treasury would be paid no more than 500,000 dollars a year, Obama said.


Any other compensation would be in restricted stock that will not vest until taxpayers are reimbursed.


Additionally, all banks must submit to tougher restrictions on "golden parachute" severance payments and new transparency rules on corporate jets, office renovations and entertainment and holiday parties.


"We're putting a stop to these kinds of massive severance packages we've all read about with disgust -- we're taking the air out of golden parachutes," Obama said with Treasury Secretary Timothy Geithner at his side.


The president also promised a new sheaf of measures designed to spark economic activity as the economy suffers from thousands of job losses and lagging consumption.


"Next week, Secretary (Timothy) Geithner will release a new strategy to get credit moving again -- a strategy that will reflect the lessons of past mistakes while laying a foundation for the future," Obama said.
Shareholders meanwhile will be offered more input into how much top company executives are paid.


The populist measures were announced as Obama tried to regain his balance after his fledgling administration was hit by the withdrawals of two high-profile nominees for top government jobs Tuesday over tax problems.


They follow a string of press reports about executives who accepted bloated corporate compensation, spent millions renovating offices and abused of corporate aviation services as Americans stagger through the economic crisis.


The measures will require affected companies to publicize large expenditures in an effort to shame them into halting such extravagance.


"When you are putting forth the kind of luxury items completely inappropriate for the circumstances we're under, you know, million dollar offices, 45 million (dollar) jets, you have to disclose that and you have to put that out for the public," said an Obama administration official.


There was some dismay at some of the new measures on Wall Street.
Douglas McIntyre at the financial website 24/7 Wall Street said the limits could make it difficult for troubled banks to retain their top executives.


"Wall Street may keep most of its bankers if they face pay cuts, but it is the top five or 10 percent who make these companies really profitable, and they will soon be on their way to greener pastures if this measure is enacted," McIntyre said.



The president also took aim at Republican critics in Congress who are trying to slice spending on infrastructure and other projects from his stimulus plan, which is priced at nearly 900 billion dollars.



"In the past few days I've heard criticisms of this plan that echo the very same failed theories that helped lead us into this crisis -- the notion that tax cuts alone will solve all our problems.



"That we can ignore fundamental challenges like energy independence and the high cost of health care and still expect our economy and our country to thrive."



"I reject that theory, and so did the American people when they went to the polls in November and voted resoundingly for change," Obama said in his most partisan public comments since he took office two weeks ago.



"I urge members of Congress to act without delay -- no plan is perfect, and we should work to make it stronger, but let's not make the perfect the enemy of the essential."




Thoughts?

[Winehole23]

JP Morgan raises the cry: unfair (http://uk.reuters.com/article/americasRegulatoryNes/idUKN0352410420090203)!

[Winehole23]

There's appearances to keep up here, doobs. Let's be realistic...

[Winehole23]

... you can't get the best guys for half a mil.

[Winehole23]

The limit is arbitrary.

[Winehole23]

Why not be fair instead?

[Winehole23]

What would a fair amount be?

[Winehole23]

Boiled down, there is no fair amount. IMO.

The measure is opportunistic, but the choice of villain is apt. It gives access to social ressentiment. Anger needs a target.

[Winehole23]

Hell, it already has one.

[Winehole23]

Target-rich environment.

[doobs]

I have three thoughts:

1. This measure could dissuade some less-needy companies from accepting bailout funds. Some of these companies would prefer to make the hard choices of business---cutting costs elsewhere, becoming leaner, selling assets---in order to protect executive compensation. To the extent that some companies will forgo federal bailout funds because they would rather operate on their own, this is a good thing.

2. Those companies choosing to accept bailout funds will be failures, in my opinion. In other words, the government's "investment" will be pointless, because these companies will be the ones who are desperate, and willing to chase away top talent in exchange for federal bailout funds. Acceptance of the conditions that go along with the bailout funds will likely only temporarily delay their failure. But it will make their failure inevitable. Which means the money will serve no purpose, really.

3. This is why government intervention into the economy troubles me. It's clumsy, it leads to political grandstanding and class warfare, and it rarely works.

[Winehole23]

This measure could dissuade some less-needy companies from accepting bailout funds. Some of these companies would prefer to make the hard choices of business---cutting costs elsewhere, becoming leaner, selling assets---in order to protect executive compensation. To the extent that some companies will forgo federal bailout funds because they would rather operate on their own, this is a good thing.Agree. More power to em if they don't need the money.

.
Those companies choosing to accept bailout funds will be failures, in my opinion. In other words, the government's "investment" will be pointless, because these companies will be the ones who are desperate, and willing to chase away top talent in exchange for federal bailout funds. Acceptance of the conditions that go along with the bailout funds will likely only temporarily delay their failure. But it will make their failure inevitable. Which means the money will serve no purpose, really.So long we're talking about small banks that are already insolvent, sure. But should we really be bailing out insolvent firms to begin with? I wonder.

ElNono has already posted an article claiming the bailout puts sound banks at a competitive disadvantage to ones in need of help. By this account, government participation has already queered the pitch.

[Crookshanks]

If we're going to start down this road to socialism and start dictating what people can make - then lets really get serious.

Do Trial Lawyers REALLY need to take 40%? Let's limit their share to say - 15%. That gives the injured parties more money to put back into the economy.

Do Hollywood Actors (especially the bad ones) really deserve to make 10 million or so for a few weeks' work? Let's pay them like the Executives - $500,000. Then maybe they could lower the price of movies and more people would go.

Do Sports stars deserve millions for only working about 8 months out of the year? Let's give them all about 3 million a year - maybe then they could lower the cost of tickets and more of the middle class fans could attend the games.

Gee - just look at all the money I've freed up to help stimulate the economy!!

[ChumpDumper]

If we're going to start down this road to socialism and start dictating what people can make - then lets really get serious.

Do Trial Lawyers REALLY need to take 40%? Let's limit their share to say - 15%. That gives the injured parties more money to put back into the economy.

Do Hollywood Actors (especially the bad ones) really deserve to make 10 million or so for a few weeks' work? Let's pay them like the Executives - $500,000. Then maybe they could lower the price of movies and more people would go.

Do Sports stars deserve millions for only working about 8 months out of the year? Let's give them all about 3 million a year - maybe then they could lower the cost of tickets and more of the middle class fans could attend the games.

Gee - just look at all the money I've freed up to help stimulate the economy!!Were the federal government bailing out all those listed above, you might not have failed.