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Again, nobody in government really wants to fix the problem here; which is so-called "Free Trade" that started this whole mess by destroying a critical mass of the best paying working class jobs in the country, and which supported millions more downstream middle class jobs.
It's just smoke and mirrors.
These companies are on welfare now and need to realize it.
And I don't want to hear about needing to keep the "best and brightest", they couldn't have been all that bright if they ran their companies into the ground.
http://news.yahoo.com/s/politico/20090204/pl_po...
Cheney warns of new attacks
Former Vice President Dick Cheney warned that there is a “high probability” that terrorists will attempt a catastrophic nuclear or biological attack in coming years, and said he fears the Obama administration’s policies will make it more likely the attempt will succeed.
said stake must be very sharp and wielded with precision-his heart is two sizes too small.
I dunno. When you think about, that's a much higher tax bracket than I'm used to.
I like this that only affects new recipients. Under paulson, some solvent banks were basically forced to take the money and do mergers that were not necessary for *their* survival at the time, like Wells Fargo. It would be lame to come back later and make changes.
The other problem here is that if you allow compensation from dividends, you encourage high dividends, which will reduce their capitalization. Stockholders won't lose anything, but it encourages management to basically liquidate the company.
The flaw in your plan -- as cynical as it is -- is that $500,000 is more than enough for anyone to live on -- way more than enough. And, the executives are being compensated for failing, not succeeding.
But, I'll buy your plan. Let's cap the salary of college grads at $450,000.
I don't mind tying to the federal pay scale but let's be realistic as to the basic qualifications at each level
A college grad asking for a loan would have a cap to the amt. loaned by these same bankers. Obviously you didn't attend college. Do you have a high school diploma?
Also, this cap must apply to all employees in order to be effective.
The guys at the top aren't almost always major, major stockholders are they?
Also, why CAN'T we get it back from the greedheads? Another Bush bungle, giving it with no strings attached, expecting the to "do the right thing"...sheesh.
If you are a CEO and asked for Federal Money then you did NOT lead your company, you failed and if you were a typical guy/gal, a fail means no pay raise or bonus, but not so with the titans of Wall Street. They have the mind set they are ENTITLED to enormous compensation, regardless of how the company performs.
When these FAILED CEO's quit asking for tax payer money to retain their lifestyle then maybe they will understand the concept of leading a company to be profitable deserves pay raises or bonuses and that leading a company to failure should require, at the very least, a look at salary with thoughts of reduction rather than upgrading.
Our tax code and government regulations needs to be changed as well to end all the preferential treatment that large corporations and companies receive. End all the incentives that the conservatives have put into place to constantly grow a company larger and larger. All it does is concentrate more and more power and wealth in the hands of a select few CEOs and their kind at the expense of society, the workers, and the other shareholders. Do you ever notice the quantity of jobs lost after a mega merger? Rarely is it due to efficencies of scale. The jobs are shredded to pay for the increased debt load of the merger and the newly inflated compensation plans of upper management.
It's easy to do here: http://returnthebonus.wordpress.com/2009/02/04/...
Sounds like some folks are going to have to join the real world again... but it'd be better if they had to start from the street and work their way up...
Good policy and good politics.
Long story short: My entire dept was outsourced/offshored to India last month.
Meanwhile, our CEO is rolling dough even if he doesn't get a bonus this year.
What's up with that? Why is there a financial incentive to send the jobs overseas?
Thankfuly, I have a generous severance package to fall back on, but I am seriously job hunting now because it might take a while to find another good position.
You know you're on fantasy island when you want money from the poor to pay your idiotic lifestyle and cry you're not playing in the sandbox because you want our $$ AND CAKE, TOO?
Most insulting - you threaten us with your talent leaving when your talent put us in the position we're in. Poof, they need to be gone!
This is frightening.
The plan is target specific, get a grip. And explain to the restr of us why these people are allowed to borrow w/out conditions like any other borrower? They don't have to take it. they can ride it out with their so-called talent they boast about. They don't take the conditions better for our deficit. A win-win if you ask me.
500k yearly is more than enough incentive to get top talent. If the people at the top of those companies don't think it's enough they should step aside so someone with just as much talent but not as many breaks in life can do the same damn thing (probably better). I went through a Talented and Gifted program when I was in school. You know, the kind where they don't give you grades, but rather have child psychologists give a more personal and detailed assessment of your academic progress. I'd be more than happy to put in the time to learn the necessary skills if it actually meant I'd have a reasonable chance of getting a 500k job. I'm not alone. Your pay, along with most everyone's pay is determined by the following three factors listed in order of importance: who you know, what people think you know, and finally what you actually know. In short, sit the hell down.
The companies requesting bailouts are essentially bankrupt without them. If you worked for a bankrupt company you would be lucky to get your last paycheck, much less a bonus. The government is providing corporate welfare in an attempt to stave off financial collapse. Just like every Mom&Pop business out there knows, its time for belt tightening, not business as usual.
I reject the idea that huge bonuses are needed to retain good workers. They are at least partly responsible for tanking their entire industry. Good luck to them finding similar pay at any of the other financial industries out there.
Government contractors are private companies. The government renders payment to these companies for services rendered. Therefore, the companies are free to set their own salaries. Bailouts are in no way payment for services rendered.
I also find bailout money for film to be a ridiculous waste of already dwindling funds. I suspect that this is someone's pet project that they stuck in the bill. I hope it will be cut.
1 - Affected firms and companies are excluded from using company funds to make contributions to specific candidate's campaign funds, PACs, political parties, or 529s.
2 - Affected firms and companies are excluded from using company funds pay for Luxury box and/or tickets to sporting events, arts events, and/or entertainment venue.
When will people start respecting Doctors and giving them bonuses.
Americans have not been fair with pay. The more Educated the less pay. The more Crook you are the more pay
There also shouldn't be a bailoput or retro repay to shareholders. Everybody knows investing is a risk, so they shouldn't be compensated for their greed either.
Kudos to President Obama to take this stand. as banks set conditions to us the public so should they be held to borrowing conditions! And if the opt not to use Gov't $$ = very good. Maybe then they can put their so called bright ideas to good use!
And what is a measley five thousand bucks, when they have been playing with trillions....
Gotta go - Obama is getting ready to nominate Madoff for something.
Madoff is a legacy of the Bush era.
The government has the resources and the power to track executive compensation for the companies that get TARP money. You keep implying that this would be a blanket rule toward all executives in the private sector. Typical deceptive move.
I think Dashcle and Geithner are qualified. I don't care so much about Daschle's taxes but rather his closeness to health care groups. You may have noticed no liberals are crying over Daschle. Still, I think very few Americans could be audited without having to pay back taxes so it is something I am just not going to get that worked up about. It is very different from Madoff and these corporate CEO's who treat money as their god given right.
I agree with your statement about most people would owe some amount of taxes but I can't believe you wouldn't get worked up about the person ultimately in charge of making sure we pay ours and levying fines on us for not paying, was 125K delinquent on their own taxes and probably would never had paid it if they weren't so greedy for the job.
I also agree that Madoff is a greedy pig. Some people are greedy for money, others are greedy for power.
http://www.youtube.com/watch?v=oxHINf0ItHg
To me, those CEO should be ashame about their performance and resign!!!!
This is America, we only reward people who do good job, have good performance. This is just a common sense.
Let's eliminate the pension option for elected officials - let's cut the auto pay raise for elected officials unless they deem otherwise. The Chicago City Council stated they deserved a 6% pay increase a couple months before the decided to eliminate or slow hiring of police and fire officers.
Greed and avarice is not limited to the CEO's of large companies - Tom Daschle proved former political folks believe they are above everyone else as well.
It's the tax payers money being used to get work done elsewhere. It needs to be stopped.
I agree, the executives should be paid what ever the market will bear, however, and this is what people don't seem to "GET". When it is your and my money, and they are asking for a bailout because they created this mess, than we have a say on how the money is spent. President Obama is speaking for us, he's saying, You want the taxpayers to bail out your ass, well than if "YOU" want it, here are the conditions.......this is called accountability, which to date, not one Wall street or Auto executive has acknowledge.
You're just making up a straw man argument.
I'm sure Citibank's CEO will struggle through.
Besides, incompetent MBAs are a dime a dozen.
You can when it is taxpayer's money. That is why you can't spend your food stamps at the liquor store.
The free market doesn't work. We should have learned this from the 20's and 30's. A mixed economy, which we've had from the 40's till today, does work if it's done properly as proven by the booming (and more importantly STABLE) economy we had in the 50's and 60's. An unfettered free market creates enormous highs and lows (note: although we haven't had a PURELY unfettered free market from the 80's till today, the contrast is pretty stark and shows the difference in stability pretty clearly). When a person has enormous highs and lows we call that bipolar disorder and give them lithium or they might DIE from any number of things that result from it. When a market has enormous highs and lows you need to regulate it to prevent it from dying.
Business is designed to make as much money as possible. Regardless what a businessman might say, companies do not exist for the betterment of society. Government, although oftentimes misguided, exists ultimately for the betterment of society. This is why businessmen make bad politicians and vice versa (Bloomberg I'm looking at you). We need business to act as a check against government or things will become cripplingly inefficient. Similarly, we need government to act as a check against business or things will become cripplingly uncompetitive. Right now business is much more powerful than government which means that in order to set things right, we need to close the gap.
I was in a Talented and Gifted program when I was in school. You know, the kind where they don't give you grades, but rather have child psychologists give a more personal and detailed assessment of your academic progress. I'd be more than happy to put in the time to learn the necessary skills if it actually meant I'd have a reasonable chance of getting a 500k job. I'm not alone. Your pay, along with most everyone's pay is determined by the following three factors listed in order of importance: who you know, what people think you know, and finally what you actually know. In short, sit the hell down.
When it is "our/my" money, I demand controls.
Someone correct me, but isn't that what banks expect of us when we borrow? Has responsibility, ownership, and accountability become a lost virtue in America; have we become a I, myself and me society.
The argument that these talented, Ivy leagued, and moneyed people will leave is beyond laughable. It is this arrogance that got us in this mess. Question: what other industry rewards for failure? The Executives (Captain of the ship) have not even hinted of responsibility. This Country is "PISSED" with the wall street slogan of " Greed is Good". Wall street produces a lot of good and yet it is a cess pool that also produces the Madeoff, Weill, and Thain of the world.
i believe the word humility is not in there vocabulary (including auto exe) because of there massive wealth which isolates them from reality.
I'd call them MBAs.
Alma Wright, Portugal
Lets attack any company who uses a private jet, or tries to buy a new one (I do agree shady) and meanwhile how much does the tax payer pay for members of congress and the senate to glob hop around the world? What did you think they paid for it themselves? ha.
When was the last time we said.. No, to the high dollars spent on government offices, furniture, etc? So they are so concerned with were the tax payers money is going, yet they (all, both Rep and Dem's) have been milking the tax payers for how long for their own luxuries, transportation, and amenities.
Sorry rant done. I think the companies are shady who receive the money, but give me a break the government waste more money then BOA, CiTI GM, etc could ever dream of on useless petty things. Priorities straight and double standards need to end along with.
Has anyone ever done a real math outcome for how much each senator actually costs the US tax payer?
Aside from this fact, by capping pay, the banks who have taken TARP money will lose most of their talented managing directors (the ones who actually ran profitable P&Ls) to smaller firms. This will put the TARP banks at a significant competitive disadvantage with smaller banks who can pay for performance, reducing the likelihood that the banks will be able to repay TARP funds to tax payers.
Unfortunately, the large degree of populist and protectionist sentiment in the US is being taken advantage of by politicians who are pressing for legislation which will impair the ability of US companies to compete in global markets.
Obama never had the experience to begin with. Everyone bought into the "change" slogan. This guy has done nothing but lower expectations since he was elected. Now the check book is open and the pen is in the hand. We are about to saddle our children and grandchildren with staggering deflation of the dollar and even more staggering inflation.
What happens if you decide to open your own business, become successful and the government use Obama's executive pay limitations as an example to limit your compensation because you used a government loan or program to get up an running? Slippery slope we are on here.
For example: If you loan me money to assist me in paying my mortgage because I’ve fallen on hard times (e.g. unemployment) and I turn around take a trip to Paris and buy a new porche, you’re right to be outraged and upset. Worse still, if someone else compels you to loan me the money (the government) and I turn around and take that trip and make that purchase you’re likely to be even more upset because you had no direct, immediate say in the loan.
Yes, you elect the officials who sign off on these decisions, but once they make decisions like this that you don’t agree with you’re stuck until their terms are up.
When the government decides to loan MY tax dollars to institutions which I have no direct interest in, I demand that reasonable restrictions be attached to their acceptance of my hard earned money.
Obama needs to get his nose out of the air and to the grindstone where it belongs. He ran around the country, hat in hand, begging for the job of President -- it's time he produces something of value in exchange for his salary.
Sharon Jefferson, Ohio
For all you folks complaining that this is socialism, let's get real.
1. If you apply for welfare/food stamps there's cap on the amount of money you can make or have.
2. If you're old and want to move into a nursing home run by the gov't, the government takes all your money and your house.
Wall Street came and begged for the money, now they have to live with it.... yup ... welfare is a bitch...
Tell the companies receiving federal funds they have to REPLACE their CEO; fine. And/or limit CEO compensation to the 2008 level -- or even the 2007 level, or 85% of the 2008 level, or whatever; fine. Or require that X% of compensation be in restricted stock that must be held for 2 years before vesting. Or something. But a $500K limit is like something a couple of 10-year-olds would dream up. And most of the comments (even the original post) seem to echo that thinking.
"I bet most Americans could live very well on $500,000/year."
-- But could they run a major financial institution?
"at least it's a place to start"
-- and end the conversation
"Aren't these the same geniuses that have gotten us into this mess in the first place and are there not other candidates qualified to take over their jobs if they leave?"
-- Probably not at $500K.
"In my opinion the cap is WAY too high and should come down to what the average American worker makes since it is our tax dollars bailing their butts out."
-- and so no one with any experience takes that job. Brilliant.
"500k yearly is more than enough incentive to get top talent."
-- in what major industry at what major company? Seriously. Oh, you were in a "gifted and talented" program in school. I'm sure just taking some crash courses will enable you to rework the financial infrastructure of the country.
Look, I'm not any fan of these companies, or of the CEOs that run them, or of the ridiculous bonuses we've heard reported being paid out, or the lavish trips they keep trying to still take, or the other things that strike us all as clueless when they're on the public dole. But there are smart ways to regulate that kind of behavior (and it should be) and there are really stupid ways, and this $500K limit is among the worst. For one thing, it means that the CEO will be making less than probably anyone reporting to him or her. And if you think "then fine, let 'em replace all of them," we're essentially back to "we should just let these companies fail." Which is a legitimate, Ron Paul kind of argument -- but not, obviously, what the Obama administration or Democratic legislators or even Republican legislators want to accomplish. Nor, for that matter, what the US and world economy need.
-- in what major industry at what major company? Seriously. Oh, you were in a "gifted and talented" program in school. I'm sure just taking some crash courses will enable you to rework the financial infrastructure of the country.
My argument had very little to do with my ability to take control of any of the companies bailed out and everything to do with the fact that any of the people in charge of those companies could be replaced successfully. Could I do it after a few crash courses? No. Could I make it happen after several years of training targeted specifically for the job? Probably. My point is that many competent people already have that several years under their respective belts.
"Tell the companies receiving federal funds they have to REPLACE their CEO; fine. And/or limit CEO compensation to the 2008 level -- or even the 2007 level, or 85% of the 2008 level, or whatever; fine. Or require that X% of compensation be in restricted stock that must be held for 2 years before vesting. Or something. But a $500K limit is like something a couple of 10-year-olds would dream up. And most of the comments (even the original post) seem to echo that thinking."
Truth be told, I'd rather that the entire upper management team was replaced for each of those companies. That's not going to happen and we both know it. Obama's plan is far from perfect and you named several problems which have pretty much already been talked about. The entire company should be capped at that amount, not just the officers. The amount shouldn't actually be 500k but an amount based upon a percentage of previous pay and a removal or cap of bonuses etc. etc. Most of us know this already. It's not going to be perfect. It's not even going to be close. 500k has a nice, even ring to it which makes it more palatable to most which makes it easier for politicians to swallow because they are beholden to their constituents.
Furthermore, taking the job isn't really about the immediate returns anyway. By proving to the world (and the shareholders) that they can turn a major financial institution on the verge of collapse into a profitable business again, any CEO with any sort of vision could become a paragon in his/her field. That sort of vision tends to pay well.
CEO's beware, there's always someone smarter, hunger with better ideas.
Ask IBM about Bill Gates...
If officials redo offices, home, or somehow rip the company off then they should be arrested and prosecuted for fraud.