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President Barack Obama kicks off a campaign to rein in corporate compensation with rules limiting executive pay to $500,000 a year for companies getting taxpayer bailout funds in the future.
Obama, who sharply criticized Wall Street chiefs for accepting billions of dollars in bonuses last year while the economy fizzled, had promised compensation reform as part of a package of stricter regulations on the financial industry…
An Obama administration official said the new rules would require companies that get exceptional government funds — such as financial giant Citigroup and insurer AIG have in the past — to abide by the cap.
Additional compensation must be limited to restricted stock that does not vest until government money is paid back with interest.
Companies that have previously received bailout money would have to agree to stricter oversight and prove that they have followed already established restrictions on executive compensation, which are widely seen as being too lax…
They will also put restrictions on golden parachutes — the lavish severance packages common for senior executives — and require more transparency for costs such as aviation services, big parties, office renovations and conferences.
Do you think executives of the corporations receiving bailout bucks have been earning their salaries, bonuses, perks? Think their payscales should remain unchallenged?
32,
“GM loses money on every car they make because they have to provide health-care and retirement benefits to nearly 1 million people – most of which no longer work for GM.”
thats why you need single payer health care.
#29–Ben==you disagree on so many levels?—good. I Always look forward to being tutored.
In your first paragraph you recommend action more punitive than what I recommend. Gee–should we be so harsh to CEO’s of failed companies? Why would anyone go to work if they don’t get paid at all? Not even a welfare payment for food and clothing for their kiddies? That doesn’t make any sense. Could you add some explaining detail to that?
Perhaps your second Paragraph: “If your company isn’t being bailed out, then its up to your shareholders. /// Its been well reported. Are you familiar with the loss of control shareholders have over corporate management? Are you familiar with the concept of “interlocking Board of Directors” where CEO’s overpopulate Corporate Boards all voting themselves excessive compensation packages?
All a limit on executive salary’s would do is move executives out of US… /// that is a shareholder decision–see how you have been corrupted? But the solution is easy==outlaw moving out of the country. If you want to sell into the USA, you pay taxes on the USA revenue and your CEO is restricted the same as USA based CEO’s. Its called “level playing field.”
cause whats the point of running your own business if there is a limit on how much proffit you can make out of it! /// Its not “your own business” silly rabbit==its the shareholders business. I think you have been so abused you don’t even know which end of yours is being porked.
Silly American voter. Victim.
# 34 Named said, “thats why you need single payer health care.”
I already have that. I am the single payer for my health care.
#24, Are we referring to capitalism as defined by Marx?
36,
Right. You pay and get denied when you need it. Makes perfect sense. But, I guess you can totally understand how health care is a for profit enterprise. The logical conclusion of for profit health care is that any illness deemed profit sucking, the bearer shall be euthanised.
bCAPITALISM: The science of ripping off the consumer to to the greatest degree possible to within the thinnest-margin-possible short of the consumer reacting negatively and changing brands, products, etc.
There is an entire science devoted to making that thinnest-margin-possible even thinner.
# 37 Sea Lawyer said, “#24, Are we referring to capitalism as defined by Marx?”
Nope, as it has been defined for a few thousand years, and made illegal by those societies…
# 38 Named said, “Right. You pay and get denied when you need it. Makes perfect sense.”
Never been my experience. However, I don’t mind if YOU want to give YOUR $ to the gov’t and go to it for service.
“Owners of capital will stimulate working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable.
The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and State will have to take the road which will eventually lead to communism.”
Anyone want to guess the originator of that quote?
#42 Why guess? Anyone who went to high school knows it.
Paddy-O. What’s it like being so joyless?
How about this one” Capitalism is Man Exploiting Man; Communism is just the opposite
#43–named–heh, heh. Yes, the evil of Marxism. Did he ever mention anything about debt/credit swaps or short selling futures market?
# 45 Named said, “Paddy-O. What’s it like being so joyless?”
Named, what’s it like being so clueless?
46,
Good one. Almost showed some levity…
48,
I don’t know. I’m not you.
47,
That whole debt swap / credit swap is just a magical shell game where the originator KNOWS there is nothing left… they just hope no one else does….
This really SUX! I can’t live on 500K per year!
Good work Mr. President!
I am so glad that there are thinking adults in charge of out country again! It’s been quite a long, long time!
Interesting clip and read about clueless capitalist here. Also, I think Lou Dobbs has mentioned several times that the debt/credit swap instruments in existence right now have a face value in excess of the entire worlds gnp. I don’t know what that means but sounds nasty. I wonder how a cascading default in that area of dark mystery would effect the “bottom of the market?”
http://huffingtonpost.com/arianna-huffington/cnbcs-clueless-mark-haine_b_163877.html
# 54 bobbo said, “Also, I think Lou Dobbs has mentioned several times that the debt/credit swap instruments in existence right now have a face value in excess of the entire worlds gnp. I don’t know what that means but sounds nasty.”
Sounds like the capitalists are on the brink of tanking the worlds economy.
Good idea. Let the screwed up execs get a pay cut. The good ones will leave for another company. Better yet, they should limit the salaries to below Obama’s.
Now if he would cut the bailout funds that were used for a Citi trip by members of Congress..
54, 55,
The Guardian did a good graphical rep… it didn’t make me feel any better visualizing it though…
http://www.guardian.co.uk/business/dan-roberts-on-business-blog/interactive/2009/jan/29/financial-pyramid
This sounds like the crap he promised about cutting taxes. First he said the rich were $300k, then $250k and then lower.
What the hell, does he think he can dictate to anyone what their maximum pay should be?
Wow! So much for the constitution. You guys thought Bush was bad………
Executive compensation can’t be controlled. They have the checkbook, control the expenditures and can easily evade any rules by another method (company loans for one, and they won’t be paying taxes on that).
And what you do care anyway unless you are a major shareholder?
If you are minor shareholder you don’t get any say anyway except the choice to sell and invest elsewhere — and executive pay won’t be on the list of things that you are worrying about when making an investment.
This is a populist move meant to sound good to the masses.
It’s good politics, though. A statement that costs nothing, means nothing but gives some people a warm heart.
#58–Vin Diesel==this very discussion came up a few days ago and because the answer is so solid, I didn’t really follow it. But in conclusion: there is no Constitutional Right to have non-capped salary arrangements. Its all controlled by the incorporation papers filed consistent with the States of Incorporation. Most corporations incorporate in Delaware because of their lenient requirements. What do you guess Biden could get done with the Incoporation laws of Delaware should he and Obama start to request same?
To reaffirm–Constitutional Rights are non-existent in this area.
#59–HMyers==what more than the current financial meltdown do you need to see before you recognize we “all” have an interest in how businesses are run (into the ground)==not just the stockholders who also are evidencing a failure even when their own financial interests are in play.
The notion that a society fares best when its business and governmental leaders are motivated by little more than overreaching GREED should have been shown for the bad policy that it is.
Evidently some of you need your little bottoms whacked some more.
# 60 bobbo said, “To reaffirm–Constitutional Rights are non-existent in this area.”
LOL
Does Omama want a pyre or a spit when he has to face the SCotUS?
Paddy–figures that was you.
OK–Obama gets the laws of Incorporation Change to read that Corporations can only pay their CEO’s up to 30 times what the overall corporate pay average is.
Why would the SCOTUS do anything except respect the duty of Congress to pass laws?
#63 Poor bobbo. I suggest you take some law courses at a university. The relevant portions have been presented MANY times on this blog.
Like I said, the smell of Omama roasting on an open fire would be interesting…