President Obama today announced a plan: if a company accepts TARP funds, it must limit executive pay to $500k a year plus stock options that cannot be redeemed until the funds are paid back.
It’s “a nightmare for any financial institution,” CNBC host Joe Kernen proclaimed this morning, while Fox Business host Alexis Glick said it was evidence of Obama being “a little anti-business.” Others insisted that the “draconian” caps would drive the “best and the brightest” away from Wall Street and that Obama’s anger over executive bonuses was misplaced:Well, of course there is another option, which is to not seek TARP funds. Fair enough, eh? That's not really anti-business, that's free-market capitalism. If this really does cause a brain drain and drives talented CEOs out of the field, we should recall these are the CEOs who put us in this predicament in the first place. Supporting genius isn't enough - we have to distinguish between it and EVIL genius.
“That is pretty draconian — $500,000 is not a lot of money, particularly if there is no bonus.” [James F. Reda, founder and managing director of James F. Reda & Associates]
“If I didn’t pay [bonuses], the people were going to go. … These people didn’t choose to cure cancer. These people didn’t choose to do public service work…These people chose to make money.” [Jack Welch, former CEO of General Electric]
Incidentally, this is a choice Obama made himself a year ago, when he refused public financing for his campaign. Interesting. You can't argue with the results, though the situations probably aren't analogous.
10 comments:
So Obama will limit his future earnings (after he leaves the White House) too, right?
After all, his salary is paid by taxpayers, he lives in a taxpayer funded house, has taxpayers footing the bill for his food and electricity and transportation.
So Obama won't take any funds over $500,000 for books, speeches, appearances, etc., right?
I knew it! No matter what the solution is, it will enrage you if it's Obama's idea. Even though you posted endlessly about the obscene salaries and bonuses these CEO's received.
You're literally not for anything, just anti-Obama. No wonder you are willing to throw the troops under the bus! They're Obama's troops now.
I posted endlessly about obscene salaries and bonuses?
I threw the troops under the bus?
I'm not for anything?
My comment merely points out what is good for the goose, is good for the gander.
Leon Panetta earned $700,000 in fees, with some of his clients being troubled banks.
http://online.wsj.com/article/SB123378062602049003.html
Should he be disqualified as the CIA nominee because he took money from businesses that poisoned our economy?
By the way, I like several of Obama's ideas-keeping Gates, rendition, attacking terrorists where they live..
Also, how does the State of New York, and the Federal Government make up the lost revenues on the taxes NOT collected by those high salaries and bonuses?
Something like 12% of NY revenue comes from those taxes. Where will the dollars come from to make up that shortfall?
3 posts! Bet I hit a nerve there.
Well, the tax shortfall will probably be made up this way - CEOs don't have to accept the terms of the bailout. And as you say, the bailout won't make any difference, therefore, no shortfall.
You like several of Obama's ideas, but at the same time you're actively rooting for him to fail at them. Interesting! The throwing the troops under the bus thing, of course, if a reference to the whole "undermining the commander in chief during a time of war" thing that I've been throwing around lately. Can I add that if you're against the President, you're with the terrorists? They're against him too you know.
Again, how have I undermined him in a time of war?
You seem to be the one doing that. I support his choice of Gates, his keeping (and expanding!) rendition, and his taking it to the bad guys with the drone attacks.
Obama has done more things that are similar to Bush Administration policy than against them.
Can you give me an example of how I have undemined the Commander in Chief? No, you can't; because it hasn't happened.
The only thing he's really screwed up is his miserable record of vetting nominees, his horrible missteps in foreign dimplomacy (Iran is laughing at us, Canada(!) is pissed because of the "Buy American" snafu, India telling us we're barking up the wrong tree, North Korea is getting ready to test long range missles, and Obama can't even control his own Speaker of the House.
What has Obama done so far that you consider his crowning achievment in his first two weeks?
I think we need to take this all the way... just to be fair.
Any school "professor" from a school that takes federal $ shouldn't make more than... what... say $30,000 a year. I also say that no school administrator form any school that takes federal money should ever make more than $60,000 a year.
There ya go. It's gotta be fair, right?
WAMK, I half owe you an apology. I went back over your postings for the last month, and I have to admit it doesn't count if you merely post OTHER PEOPLE'S undermining remarks with the admonition "read the whole thing." It reminds me of how Bush never said that Iraq was in on 9/11 yet we all somehow got the idea anyway. So you'll get the other half of the apology if you see your way clear to actually say something complimentary about the President.
Publius, you'll admit that an employer has the right to pay whatever they think they can afford, yes? Isn't that why you hate unions? Well, if companies accept bailout money we should be able to attach terms - after all, we're basically investing. They don't like it, they can get the money somewhere else.
And hey, here's an idea. If these guys are willing to go into teaching instead of screwing up the financial sector I'm open to paying them more than most teachers. Say 4%.
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