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Obama imposes limits on executive pay
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Matthew Love Send message Joined: 26 Sep 99 Posts: 7763 Credit: 879,151 RAC: 0 |
Obama imposes limits on executive pay $500,000 cap would apply to those getting ‘exceptional’ bailout assistance limits on executive pay LETS BEGIN IN 2010 |
John McLeod VII Send message Joined: 15 Jul 99 Posts: 24806 Credit: 790,712 RAC: 0 |
Obama imposes limits on executive pay Some of the executives that got bailouts under Bush recently received bonuses from their companies in the range of tens of millions of dollars. Is this a wise expenditure of public money? BOINC WIKI |
StormKing Send message Joined: 6 Nov 00 Posts: 456 Credit: 2,887,579 RAC: 0 |
Obama imposes limits on executive pay I agree, this would be a poor use of public funds, but which companies are you referring to? Also, was it wise that the banks that received bailout funds used the money to buy out other banks instead of freeing up the lending market? Example: PNC bought out National City. |
Matthew Love Send message Joined: 26 Sep 99 Posts: 7763 Credit: 879,151 RAC: 0 |
Greed has been the motto in Corporate America for the last 8 years. This is A good exmaple of that fact. LETS BEGIN IN 2010 |
Rush Send message Joined: 3 Apr 99 Posts: 3131 Credit: 302,569 RAC: 0 |
Some of the executives that got bailouts under Bush recently received bonuses from their companies in the range of tens of millions of dollars. Is this a wise expenditure of public money? That depends. Do you want the best of the best of the available people with that skill set? Or do you want the best of the best to avoid those positions like the plague in order to find much greener pastures that pay substantially more WITHOUT the problem of every ignorant, mindless, populist jackass, and the press, and the federal government breathing down their necks? Keep in mind, running these companies is an extremely difficult business, and even the very best of these people will sometimes fail at doing so. As an aside, if you want the freedom to earn as much money as you can convince someone else to pay you, you can understand why these people want that same freedom. That they happen to be better at it and can sometimes command millions doesn't have any bearing on the principle of the freedom to sell one's labor to whomever he wants to. Cordially, Rush elrushbo2@theobviousgmail.com Remove the obvious... |
Matthew Love Send message Joined: 26 Sep 99 Posts: 7763 Credit: 879,151 RAC: 0 |
Some of the executives that got bailouts under Bush recently received bonuses from their companies in the range of tens of millions of dollars. Is this a wise expenditure of public money? Not at the expense of the American Tax Payer! If these CEOs are the best of the best then why do they need bail out money! LETS BEGIN IN 2010 |
Rush Send message Joined: 3 Apr 99 Posts: 3131 Credit: 302,569 RAC: 0 |
That depends. Do you want the best of the best of the available people with that skill set? Or do you want the best of the best to avoid those positions like the plague in order to find much greener pastures that pay substantially more WITHOUT the problem of every ignorant, mindless, populist jackass, and the press, and the federal government breathing down their necks? Did you even read the post? It made the point that limiting the pay will GUARANTEE that the best of the best will go ELSEWHERE, "in order to find much greener pastures that pay substantially more WITHOUT the problem of [] ignorant, mindless, populist jackasses, and the press, and the federal government breathing down their necks." It also noted that "running these companies is an extremely difficult business, and even the very best of these people will sometimes fail at doing so." In other words, they "need" bail out money because being the best of the best doesn't mean success. Hell, I'll bet 99% or so of all companies ever formed since say, 1900 have failed. Being at the "expense of the American taxpayer," is just more idiocy that insures that companies that should have failed waste a LOT more resources before and that the status quo is alive and well. Thanks Obie! Cordially, Rush elrushbo2@theobviousgmail.com Remove the obvious... |
Bobby Culpepper Send message Joined: 5 Apr 08 Posts: 29 Credit: 43,368 RAC: 0 |
The CEO's may not be the problem. Does anyone remember how to not kick someone when he is down? How about in boxing when after a man is knocked down the other person is sent to the far corner. Competition no longer helps make American business stronger it destroys businesses. This is what needs to change. We need rules to prevent business from destroying one another. Why do we need such rules? Because there are jobs at risk. Innocent workers, not corporate players are getting hurt. The country is getting hurt. Of course Corporate pay should be limited, but all pay should be regulated somewhat. Minimum wages is the only protection many people have. Maximum pay is equally important. Running a large business is an art; however, to say the CEO should make 40+ times what the custodian makes is ridiculous. Let's see how well the CEO likes using a dirty toilet. |
zoom3+1=4 Send message Joined: 30 Nov 03 Posts: 66162 Credit: 55,293,173 RAC: 49 |
The CEO's may not be the problem. Does anyone remember how to not kick someone when he is down? How about in boxing when after a man is knocked down the other person is sent to the far corner. Competition no longer helps make American business stronger it destroys businesses. This is what needs to change. We need rules to prevent business from destroying one another. Why do we need such rules? Because there are jobs at risk. Innocent workers, not corporate players are getting hurt. The country is getting hurt. Of course Corporate pay should be limited, but all pay should be regulated somewhat. Minimum wages is the only protection many people have. Maximum pay is equally important. Running a large business is an art; however, to say the CEO should make 40+ times what the custodian makes is ridiculous. Let's see how well the CEO likes using a dirty toilet. Or having to clean It themselves, It isn't all that hard to do, One just needs the right tools. :D The T1 Trust, PRR T1 Class 4-4-4-4 #5550, 1 of America's First HST's |
Rush Send message Joined: 3 Apr 99 Posts: 3131 Credit: 302,569 RAC: 0 |
Surprise, surprise, surprise. Among other comments: “These rules will not work,†James F. Reda, an independent compensation consultant, said on Friday. “Any smart executive will (a) pay back TARP money ASAP or (b) get another job.†Exactly. It's called a brain drain. As as I said, limiting pay will GUARANTEE that the best of the best will go ELSEWHERE in order to find much greener pastures that pay substantially more WITHOUT the problem of ignorant, mindless, populist jackasses, the press, and the federal government breathing down their necks. From the NYT: February 14, 2009 Stimulus Plan Sets New Limits on Executive Pay By EDMUND L. ANDREWS and ERIC DASH WASHINGTON  A provision buried deep inside the $787 billion economic stimulus bill would impose restrictions on executive bonuses at financial institutions that are much tougher than those proposed 10 days ago by the Treasury Department. The provision, inserted by Senate Democrats over the objections of the Obama administration, is aimed at companies that have received financial bailout funds. It would prohibit cash bonuses and almost all other incentive compensation for the five most senior officers and the 20 highest-paid executives at large companies that receive money under the Treasury’s Troubled Asset Relief Program, or TARP. The stimulus package was approved by the House on Friday, then by the Senate in the late evening. The pay restrictions resemble those that the Treasury Department announced this month, but are likely to ensnare more executives at many more companies and also to cut more deeply into the bonuses that often account for the bulk of annual pay. The restriction with the most bite would bar top executives from receiving bonuses exceeding one-third of their annual pay. Any bonus would have to be in the form of long-term incentives, like restricted stock, which could not be cashed out until the TARP money was repaid in full. The provision, written by Senator Christopher J. Dodd, Democrat of Connecticut, highlighted the growing wrath among lawmakers and voters over the lavish compensation that top Wall Street firms and big banks awarded to senior executives at the same time that many of the companies, teetering on the brink of insolvency, received taxpayer-paid bailouts. “The decisions of certain Wall Street executives to enrich themselves at the expense of taxpayers have seriously undermined public confidence,†Mr. Dodd said Friday. “These tough new rules will help ensure that taxpayer dollars no longer effectively subsidize lavish Wall Street bonuses.†Top economic advisers to President Obama adamantly opposed the pay restrictions, according to Congressional officials, warning lawmakers behind closed doors that they went too far and would cause a brain drain in the financial industry during an acute crisis. Another worry is the tougher restrictions may encourage executives to more quickly pay back the government’s investments since, in a compromise with the financial industry, banks no longer have to replace federal funds with private capital. That could remove an extra capital cushion, further reducing lending. The legislatively imposed pay curbs are, in essence, a bad report card for the Treasury secretary, Timothy F. Geithner, for failing to be tough enough on companies getting bailout money. His long-awaited bank rescue plan also received harsh reviews when it was released this week. But some experts on executive compensation warned that the restrictions could unleash unintended consequences, like encouraging banks to increase salaries to make up for diminished incentive pay. Even then, they warned, banks were likely to lose top talent. “These rules will not work,†James F. Reda, an independent compensation consultant, said on Friday. “Any smart executive will (a) pay back TARP money ASAP or (b) get another job.†The biggest difference between Mr. Dodd’s provision and the Treasury rules is that the new stimulus provision would apply to any company that either has received money or will receive money in the future under the Treasury’s financial rescue program. By contrast, the plan announced by Mr. Geithner would apply only to companies that receive federal money in the future. The revised rules do not impose a formal cap on executive compensation, unlike the Treasury proposal. Under that plan, banks were barred from paying more than $500,000 in salary until they repaid the TARP funds to the government. (Banks were permitted to offer bonuses in restricted stock.) Senator Dodd’s rules, however, go a step further, prohibiting banks from awarding restricted stock to 25 top executives equal to more than one-third of their annual cash compensation until the banks have repaid all the money owed. In addition, the Congressional rules would affect not just a bank’s top management, but also star traders, investment bankers, fund managers and commission-based sales representatives. They have traditionally received multimillion-dollar payouts based on their year-end results. Jennifer R. Psaki, a spokeswoman for the White House, said President Obama “shares a deep concern about excessive executive compensation at financial firms that are receiving extraordinary assistance from American taxpayers.†But she hinted at the White House’s displeasure, saying that Mr. Obama “looks forward to working with Congress to responsibly address this issue.†One unintended effect, compensation experts said, is that financial firms might increase banker salaries in order to increase the restricted stock awards. “About the only way to address these limits is to pay large salaries,†said Michael S. Melbinger, an executive compensation lawyer at Winston & Strawn in Chicago. “There’s no pay for performance in this.†Others warned that because of the rules, firms might lose their best traders and managers to hedge funds and foreign banks. Alan Johnson, a compensation consultant who advises many Wall Street banks, said that the rules would make it hard to recruit new managers, too. “At some point, you begin to wonder: has the government given up on these companies anyway?†he said. “Why would the government or White House want to go along with that unless they have come to the conclusion they will have to nationalize these firms anyway?†Cordially, Rush elrushbo2@theobviousgmail.com Remove the obvious... |
Aristoteles Doukas Send message Joined: 11 Apr 08 Posts: 1091 Credit: 2,140,913 RAC: 0 |
if they got their bisnes in chaos, how they can be the best of the best? |
zoom3+1=4 Send message Joined: 30 Nov 03 Posts: 66162 Credit: 55,293,173 RAC: 49 |
if they got their businesses in chaos, how they can be the best of the best? Simple, Their Human, Humans make mistakes sometimes. The T1 Trust, PRR T1 Class 4-4-4-4 #5550, 1 of America's First HST's |
Aristoteles Doukas Send message Joined: 11 Apr 08 Posts: 1091 Credit: 2,140,913 RAC: 0 |
tiny mistakes are different thing, we are talking bankruptsy |
zoom3+1=4 Send message Joined: 30 Nov 03 Posts: 66162 Credit: 55,293,173 RAC: 49 |
tiny mistakes are different thing, we are talking bankruptcy True, But still no one is perfect or can be expected to make the right decision all the time as sometimes there's no right decision that can or could be made, Only the lesser painful decision. To say people making decisions had to be perfect is to be crazy and deluded, As people no matter who they are, Are flawed and do the best they can with what they have, Of course there are those who shouldn't occupy the positions they have as they are incompetent. The T1 Trust, PRR T1 Class 4-4-4-4 #5550, 1 of America's First HST's |
John McLeod VII Send message Joined: 15 Jul 99 Posts: 24806 Credit: 790,712 RAC: 0 |
The basic premise of pay for performance is that the pay should go down when the company is in trouble. Recently this has NOT been the case for many companies. As long as the company has TARP funds, it is in trouble, and executive pay needs to be lowered. Once off TARP, the rules revert back to whatever the board feels appropriated. The taxpayers paid a large amount of bailout money to banks only to see executive bonuses eat a larger than expected amount of that. I would like to note that a couple of the new CEOs of banks that are getting bailout funds have voluntarily reduced their annual salary to $1 while the company is in this much trouble. This is the same the Lee Iacoca did when Chrysler got bailout funds. You may get an excelent CEO now with very low salary if there is the promise of bonuses and salary increases if the CEO does a major turn around. Deferred payment for a job well done is not a problem. Huge bonuses for failure and running the entire economy of the US into the ground is a problem. BOINC WIKI |
Rush Send message Joined: 3 Apr 99 Posts: 3131 Credit: 302,569 RAC: 0 |
The basic premise of pay for performance is that the pay should go down when the company is in trouble. While that may be the case with "pay for performance," that does not mean that the individuals in question contracted for pay for performance, and the point still remains. Recently this has NOT been the case for many companies. Of course not. Some companies use this, many do not. Many do not because at this level, things can go wrong REGARDLESS of one's performance. As long as the company has TARP funds, it is in trouble, and executive pay needs to be lowered. Which, as I said, results in the best and the brightest going somewhere else, which means that the taxpayers are FAR less likely to recoup any of their "investment." Once off TARP, the rules revert back to whatever the board feels appropriated. Sure. The taxpayers paid a large amount of bailout money to banks only to see executive bonuses eat a larger than expected amount of that. C'est la vie. The amount in question is generally negligible in relation to the costs and operating expenses of corporations of this size. In other words, you could take away 100% of these executives' compensation, apply it to the corporation's operating capital, and it would have zero affect on the ultimate outcome. None, because the amount is question is meaningless to the day-to-day operations of these companies. I would like to note that a couple of the new CEOs of banks that are getting bailout funds have voluntarily reduced their annual salary to $1 while the company is in this much trouble. This is the same the Lee Iacoca did when Chrysler got bailout funds. This, of course, had no bearing on the outcome of the corporation. It was just populist pandering. He still got the rest of his recruitment bonus, and Chrysler STILL lost nearly $500 million dollars in '80 or '81. You may get an excelent CEO now with very low salary if there is the promise of bonuses and salary increases if the CEO does a major turn around. And, more likely, you may get the dregs if they know the company is skrewed. Or if they realize they WON'T get paid if the company can't be turned around. Deferred payment for a job well done is not a problem. Huge bonuses for failure and running the entire economy of the US into the ground is a problem. Heh. This is just silliness. The CEO at GM cannot run "the entire economy of the US into the ground." None of them can. These companies fail, the shareholders lose most of their investment, and the assets are used to in other productive investments, as other manufacturers pick up the slack. Now, what could run the U.S. economy into the ground is trillions and trillions of dollars of national debt, and the endless increase of the money supply, and endless deficit spending, and massive and punitive tax levels, and oh, wait, all that's already being done... Cordially, Rush elrushbo2@theobviousgmail.com Remove the obvious... |
John McLeod VII Send message Joined: 15 Jul 99 Posts: 24806 Credit: 790,712 RAC: 0 |
Heh. This is just silliness. The CEO at GM cannot run "the entire economy of the US into the ground." None of them can. These companies fail, the shareholders lose most of their investment, and the assets are used to in other productive investments, as other manufacturers pick up the slack. Individually, no company can tear down the entire economy, but when a large fraction of a single sector (banking in this case) is so badly run that the entire sector crashes (as just happened) this can drag the economy down (as happened this past fall). Or is it the case that you have blinkers on and just cannot understand that unbridled capitalism can lead to disaster. BOINC WIKI |
Rush Send message Joined: 3 Apr 99 Posts: 3131 Credit: 302,569 RAC: 0 |
Heh. This is just silliness. The CEO at GM cannot run "the entire economy of the US into the ground." None of them can. These companies fail, the shareholders lose most of their investment, and the assets are used to in other productive investments, as other manufacturers pick up the slack. The events that happened this past fall, hmmmm. Are we all dead? Did the market fall to zero? Are all the banks in the U.S. dead? Overwhelmingly, American banks are not failing. An entire sector did not fail. Wow. What a surprise. Why? Because not all banks were run like Lehman Bros. The gov't forced these companies to make loans that the otherwise would not have made, so that loans "looked like America," and other silly nonsense. The gov't then sorta, kinda, wishywashily, "guaranteed" them by bundling them with other loans and selling them off with a MUCH higher rating than they deserved. In other words, the gov't skewed economic activity that otherwise would not have taken place, and that created a bubble. It's no real surprise that if you artificially inflate a bubble, that's bubble is going to pop. But even that it did, IT SHOULD HAVE POPPED. Because that *pop* destroys artificially created and propped up value and brings values back into line with where they belong. If you don't like the >pop< then the answer is not to artificially create the bubble in the first place. Or is it the case that you have blinkers on and just cannot understand that unbridled capitalism can lead to disaster. You simply don't understand: these events weren't caused by "unbridled capitalism" because the U.S. market isn't unbridled capitalism. It's a HIGHLY regulated market, with thousands and thousands of pages of regulation. That's not unbridled by any sense of the word. It's just massive gov't regulation. Any market can have it's ups and downs. Of course. But actual unbridled markets are not subject to massive swings because there aren't artificially induced pressures that make people do things they otherwise would not have done. Take for example, the mobile phone market. Notice that the prices of those phones continually trend down, with more and more and more for your money. Without sudden massive price swings, where suddenly the phones increase to $1200.00 per phone and everyone is in a panic!! No one in their right mind would have made the mortgages that the gov't was forcing lenders to make as is evidenced by the fact that they weren't making them before more regulation came along. No one in their right mind would have bought those crappy bundled securities because they were a bad bet, well, that is, they were until the gov't guaranteed them. Then they were a sure thing and a smart idea to buy, which is what created the bubble in the first place. It makes all the sense in the world to give a mortgage to anyone if you're going to get paid, and the idiotic gov't is going to take all the risk and guarantee that mortgage for you. What does that do? Means scads of people can buy. That drives home prices higher and higher. And as people see mortgages as a no-lose investment, they buy homes they cannot afford, bringing more people into the market and driving home prices higher. What is this called? A bubble. Why is it a bubble? Because people were responding (rationally) to an artificially inflated system. Finally, the bubble popped. Not because a few, really few, CEOs were paid too much. Not because populists like Lee Iaococca pandered to suckers and fools who simply don't know any better and gave up some of his annual income. Not because they did the smart thing and bought gov't backed securities that were a sure thing (and they were right--it was a sure thing, the gov't DID bail them out.) It popped, like all bubbles do, because once the artificial propping starts to fail, people try to get out. That's not overpayment to CEOs, or their actions. It's idiocy on the part of the gov't for creating a bubble in the first place. Cordially, Rush elrushbo2@theobviousgmail.com Remove the obvious... |
Aristoteles Doukas Send message Joined: 11 Apr 08 Posts: 1091 Credit: 2,140,913 RAC: 0 |
rush, stop talking about economics since you can not comprehend it |
skildude Send message Joined: 4 Oct 00 Posts: 9541 Credit: 50,759,529 RAC: 60 |
Yes he can. It involves non job holding trustfund receiving, silver spoon in mouth, investment interest spending, Now tax on RIch neophites getting massive tax cuts to support their patte', caviar, and art collecting habits. All the while looking down their noses at the schlubs cutting their grass wondering what that liquid is escaping from their bronze backs. Could we have a group of people so out of touch with reality that would have a revolution and they are the guests of honor. In a rich man's house there is no place to spit but his face. Diogenes Of Sinope |
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