Obama Seeks to Cap Pay on Executives

I really applaud this move

I agree Irish. Does that mean they won't get their huge bonuses either?

So do I Irish!

The key point being :

"....to impose a $500,000 pay cap on executives whose firms receive government financial rescue funds, a dramatic intervention into corporate governance in the midst of financial crisis."

If this was just a blatant across the board cap on every and all executives, then I would be against it. But he's made, what in my opinion is, the right decision in capping the salaries / bonuses for executives who's companies are being bailed out with my tax dollars. As a matter of fact, under the current financial crisis that we are facing, that cap should be more like $200,000!

And if the company is being bailed out by my tax dollars due to the negligence of that company's executives, those executives should get ZERO, no pay, nothing. These blood sucking scumbags need to be held accountable!

DC tell them what you REALLY think!

There's gonna be another aspect to the stimulus. They are going to make it unnecessary for anyone to pay Lompac the minimum wage.

WHY???? He's smhat! He can do things!

Hey Cardi, I am with you. We agree on this. High five!!

I heard today that the $500,000 is 10 times more than the average person makes. Excuse me....but boo Fucking hoo to the big shots.


TIS

I would add no pay raises for the Senate and Congress.

Mig,

I might be mistaken but I think Obama has already at least "suggested" that.


TIS

Also, Obama signed legislation to extend healthcare to the kids:

http://news.yahoo.com/s/ap/20090205/...ldren_s_health

Part of the Stimulus package:

$20 Million Loans for vehicle battery manufacturers!
$20 million For the removal of small to medium-sized fish passage barriers!
$400 million for sexually transmitted disease prevention!
$50 million in funding for the National Endowment for the Arts!
$248 million dollars for new furniture for the Department of Homeland Security!
$75 million for anti-smoking programs!


How the hell does any of the above help unemployed people and the overall economy?

They've got to be kidding me!

You mean the guy who promised change ain't doing nowt!

Well DC, it's an infusion of funding that otherwise would not be infused. It's capital available for distribution for wages, capital expenditures, asset acquisition, etc. That's what we need to stimulate purchasing and lending.

I also think that the lender can impose conditions on the borrowers. It's that simple.

Well, the ol' boy said he wouldn't raise taxes on people who make less than 250,000 a yr., but cigarettes have now gone up by about 6 bucks a carton and it's KILLING people in the c-store industry -- I know, b/c I work for a c-store distrubion center.

There's been talk of raising the cigaret tax for months now. Even as an ex-smoker, I admit every time they tax it's the cigaret tax that skyrockets punishing the smoker. Why not hit the alcohol industry, porn industry or any other addictive habit that can be harmful to your physical, emotional, or mental well being (not to mention others well being)? Anyway, I guess that' a whole other topic.


TIS

DC, I'm sure people work for vehicle battery manufacturers, I'm sure people work in the arts. And I'm sure that people work for agencies that administer smoking cessation programs and administer counseling programs re: STDs, not to mention those who manufacture nicotine patches and condoms!!

Plus, what you're talking about is about $750 MILLION of $827 BILLION, overall a small percentage. Sounds like propaganda to me!

What is most important is that the stimulus package offers tax cuts and it offers incentives to first-time homebuyers and those buying new automobiles. Since housing and autos have been hit so hard, I'm holding out hope that things will start to look up.

That increase in cigarette taxation that you refer to is not upon income and is not a function of Congressional legislation. It is upon a product and a function of state legislation.

Sure, if you want more unemployed crabs existing.

TIS-did you ever see this film?
http://en.wikipedia.org/wiki/Thank_You_for_Smoking

There will be a lot of big shots at these companies who will change their job titles so that they are not "senior executives", take more awards in restricted stock, give people cushy deferred comp packages, or create subsidiaries to run so that they make more than $500K, but are not strictly speaking an officer of the company receiving bailout funds.

Carl Icahn believes that the executive pay restrictions are a stopgap measure and that what needs to occur is greater shareholder democracy. He wants to restore the primacy of ownership over management.

http://online.wsj.com/article/SB123396742337359087.html

Lilo,

I have not seen the movie, although I think it's been on HBO. I could never really tell if it was a comedy or drama or message film or what. The link you posted is the most information I've seen on the film. Maybe I'll check it out. Sounds like the kind of movie I'd have to be in the mood to see.


TIS

TIS, it's a hilarious movie! I highly recommend it

Europe following Obama's Lead in Limiting Corporate Pay?

PARIS — This was supposed to be bonus season for the once-pampered bankers of Europe. Instead, it has become payback time.

With President Obama telling American executives to curb excessive pay, an increasing number of European banks are limiting or canceling the high salaries and bonuses once seen as an inalienable right.

Banks that choose not to show moderation — even the small band of banks that did not receive government help, like Barclays in Britain and Deutsche Bank — run the risk of angering shareholders, members of the public and politicians who are eager to show that taxpayer money is not lining the pockets of those whom many blame for the financial crisis.

“There’s something to be said for bankers piping down a bit and seeing where they went wrong,” said Frits Bolkestein, a former European commissioner for the internal market, summing up the mood of many in Europe. “There’s a lesson to be learned.”

“There’s no opposition to giving bonuses or high pay to people who are successful,” said Mr. Bolkestein, now a professor at the universities of Delft and Leiden in the Netherlands. “But there should be no extra money for people who have failed.”

And, in some cases, no jobs. Royal Bank of Scotland Group fired seven nonexecutive directors Friday as part of a restructuring agreement with the British government, which pumped in about $30 billion to rescue the bank.

On Friday, European governments were encouraged to follow the example of the United States by limiting executive pay at companies receiving government aid.

“The commission very much welcomes this kind of limit placed on the pay and bonuses of executives,” a European Commission spokesman, Jonathan Todd, was quoted as saying by Reuters. Such restrictions could be an extra incentive for banks to repay state bailouts.

The commission, the European Union’s executive body, has approved billions in state aid for European banks since last summer.

In Washington, Mr. Obama imposed rules early this week setting a $500,000 cap on cash compensation for the most senior executives at companies receiving aid, curtailing severance pay when top executives leave a company and restricting the cashing of stock incentives until government assistance is repaid.

Brussels has no plans for now to propose legislation on the issue, so it remains up to individual European countries to decide on limits for bankers’ pay.

Perhaps still aware of the shock caused by the trading scandals last year at Société Générale and another large bank, Groupe Caisse d’Épargne, President Nicolas Sarkozy of France used a televised exchange late Thursday to rail against the excessive rewards given to traders.

Mr. Sarkozy said he was “more shocked by the system of pay” for traders than he was for bankers’ remuneration. “That’s what you have to forbid,” he said.

Paris had announced that banks accepting the 21 billion euros, or $27.3 billion, that it has offered in aid would not be allowed to pay bonuses. The same rules will apply to the French automobile industry, which is awaiting a bailout.

The French employers’ group Medef has published recommendations that include limiting golden parachutes, or negotiated exit payments for executives, and eliminating bonuses for managers who “played a role in this disaster,” according to Laurence Parisot, chief executive of Medef.

Elsewhere in Europe, several banks have moved to limit rewards. BBVA, a Spanish bank, said Thursday that it would freeze the salaries of top executives, while Danske Bank in Copenhagen, said that it had canceled bonuses for its executive board.

Germany also plans to ban bonuses and has set a 500,000 euro limit, about $641,000, on executive pay at rescued banks.

In Switzerland, the government has proposed curbs on banking bonuses but no formal agreement has been reached.

UBS, a Swiss bank that has received state help, has said that its chairman, Peter Kurer; its chief executive, Marcel Röhner; and other members of the executive board would receive only salaries for 2008 and that all other employees would get lower bonuses.

Norwegian banking executives are taking action ahead of any government-imposed cap, promising to voluntarily freeze their salaries, while the Dutch government has taken steps to limit golden handshakes for executives leaving banking and insurance firms.

In Britain, the Royal Bank of Scotland has become a test case for the new frugality. Last month, as Prime Minister Gordon Brown introduced the latest bailout of RBS, which increased the state’s shareholding to 70 percent, he raged at the “irresponsible risks” of its bankers.

Meantime, speculation has been building that RBS was preparing to pay generous bonuses when it announced 2008 results on Feb. 26.

But Mr. Brown said Thursday that top executives at the bank had left without severance pay, while no bonuses were being paid to board members and no dividends to shareholders.

Angela Knight, chief executive of the British Bankers’ Association, said that as the dust settled after the crisis, the public’s attitude toward the sector should soften.

“Many banks, even in these turbulent times, are well run and profitable,” Ms. Knight said. “The serious problems experienced by some well-known High Street names are having an impact on how people see the industry as a whole but, as we work through the current worldwide economy challenges, the image of banks and bankers is likely to improve.”

She cautioned on the need for “proportionate and smart” regulation of banks. “We have always said bank pay is a matter for shareholders, and this is particularly the case for those banks where the U.K. government has a stake in the business,” she said.

At RBS, those executives who have survived the government-led culls are no longer finding the cosseted life they once had.

Instead of casually plunking down the company credit card, RBS bankers now must get approval before entertaining clients, and must pick up their own bills for meals on business trips.

For the moment, some European banks are trying new ideas to retain or attract talent, like deferring bonuses or offering stock options in parent companies.

http://www.nytimes.com/2009/02/07/busine...rss&emc=rss

No one is disputing the part of the stimulus package that addresses tax cuts, first time homebuyer incentives, new car purchases, etc. That what it's supposed to be all about.

But it insults the intelligence of the taxpaying citizen when people defend these bullshit "add on" pork packages that give $400 million for sexually transmitted disease prevention! I haven't seen anything on CNN or CNBC informing us that 10,000 people in the condom / sexually transmitted disease prevention industry were about to lose their jobs! Let's be realistic here! These kinds of add ons are the "I'll make you a deal" add ons. They're from senators and congressman who have promised to push for certain bills in return for getting support and votes from various lobbyists.

Want to prevent sexually transmitted diseases? Want to fund that prevention? Fine, I have no problem with doing so. But make those kinds of issues a seperate package. Don't try and disguise it, attach it and hide it under a stimulus package that specifically is supposed to be designed to help the overall economy in a country that is only inches away from financial disaster! PRIORITY!

Use that $400 Million to help people who are about to lose their homes!

The attitude of it only being $750 million dollars, only being a small percentage of the package is exactly what has been part of the problem that has contributed to the situation that we now find ourselves in.

It only being $750 Million as part of this package, and then it only being $350 Million as part of that package, and once again it only being $900 Million as part of this package, adds up over time. It eventually adds up to a lot of money.

It may only be a small percentage dollar wise in the big pictured scheme of things to you, but when you stop and think about it, that "only" $750 Million can go a very long way in saving that many more homes for those families who are about to lose their homes!

I have to disagree, DC. Yes, it's pork. Perhaps, however, it's pork for a reason. Those prevention programs may be in danger because local legislation can no longer fund them (for example, I know that both my state and county have publicly funded smoking cessation programs). With the squeeze on local governments, perhaps those programs are in danger of being suspended, and a congressman is pushing for the pork in order to keep those important programs active for his or her constituents.

I'm not saying that this arm-twisting is new or unusual, nor am I happy about it. However, as I know that you are an experienced businessman, you should know that there's always some compromise to get something accomplished. Just because there's a new face in The White House, it's naive to expect less.

We're a pluralistic society. To get elected and reelected requires that candidates and incumbents be sensitive to that pluarlism. Ours is a system of competing interests for limited resources. As SB states, compromise is essential to political accomplishment.

A new face in the White House has absolutely nothing to do with what I am trying to point out in regards to this bailout program. I don't care if George Washington was the President right now. It has nothing to do with what's been added to this bailout!

Your point is well taken and what you say is true as far as wheeling and dealing goes in Washington. However, we're talking about a government bailout here in what very well could be one of the most historic financial collapses in the history of this country. We're not talking about everyday common bills be presented, negotiated and passed with the average "pork" package attached to it.

We're talking about a very crucial bailout package here. One that basically is intended to get mainsyream America, the working class and corporate America back on track. A package that hopefully will help the country avoid finacial disaster.

I'm sorry, these are not normal circumstances. Under these circumstances those boarderline pork ad on packages must be more closely scrutinized and the personal politics and deals must be set aside for the betterment of our nation as a whole. PRIORITIES MUST be set now!

I know that right now, priorities tell me that $400 Million in THIS kind of a bailout, under the current circumstances, would be better used to save homes than to prevent sexual diseases.

It must be pork because there is something not quite kosher about this. Regardless, it's still a move in the right direction.

Since you posted your thoughts in an Obama thread, I was sure it did! My mistake.

And as much as I agree with you, I think that you're being unrealistic. Separating pork from Washington is like separating paint from a wall.

Now that's a good line.

New Gallup Poll....and its not good for the GOP: