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U.S. to Order Steep Pay Cuts at Firms That Got Most Aid

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posted on Oct, 21 2009 @ 03:53 PM
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nytimes.com


WASHINGTON — Responding to the growing furor over the paychecks of executives at companies that received billions of dollars in federal bailouts, the Obama administration will order the companies that received the most aid to deeply slash the compensation to their highest paid executives, an official involved in the decision said on Wednesday.

Please visit the link provided for the complete story.


Seems reasonable to me. We're all paying for the bailouts and the least these executives can do is not throw it in our faces with their lavish bonuses and lifestyles after they have almost brought down the world economy.

If the profits of these companies are all private, but the losses are all socialized (i.e. we ALL pay with our taxes) then we can reasonably expect that the executives will be adequately but not extravagantly paid.

Sure, the execs. can threaten to go elsewhere where the bonuses are bigger, but I don't think there must be a lot of demand for people who have already run their companies into the ground. Even if they left, what kind of loss could that be?

But maybe I'm naive and don't understand the corporate culture well enough.




posted on Oct, 21 2009 @ 04:16 PM
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Hmmm... this is disturbing to me. Too much government meddling in private industry. Last time I checked we still had free enterprise in this country.

I agree there should be restrictions on companies that have not paid "us" back, but if they have then they should be free to operate as they see fit.



posted on Oct, 21 2009 @ 04:36 PM
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If you take one dime from the federal government you're theirs. They will call the shots, regardless of what it is--schools, highways, business, or religion.

This is not a good trend, but it is the trend, so hold on to your hats.

The road to hell is paved with good intentions.



posted on Oct, 21 2009 @ 04:45 PM
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reply to post by sylph hugger
 


I agree with you - if they've paid their stimulus loan back then the government should have no say in how much their compensation should be. Companies like that should only answer to consumers and shareholders.

But you never know, there might have been something in the fine print of the contract of that bailout money that said "regardless of whether you pay the loan back or not, we still get to tell you what to do".



posted on Oct, 21 2009 @ 05:05 PM
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Originally posted by Sestias
nytimes.com


WASHINGTON — Responding to the growing furor over the paychecks of executives at companies that received billions of dollars in federal bailouts, the Obama administration will order the companies that received the most aid to deeply slash the compensation to their highest paid executives, an official involved in the decision said on Wednesday.

Please visit the link provided for the complete story.


Seems reasonable to me. We're all paying for the bailouts and the least these executives can do is not throw it in our faces with their lavish bonuses and lifestyles after they have almost brought down the world economy.


No, it is not reasonable. Granted, these people maybe making what we consider too much based on the performance of their companies, but having obama dictate salaries is just wrong.

First, there is no constitutionally granted authority for obama or the executive branch of the federal government to do this. So, if we allow the unconstitutional power grab just because we think the rich guys have it coming, what will you do when they turn the spotlight on your jobs at your companies?

Last, it seems likely that much of the top management of these companies will leave to find other jobs with compensation similar to what they're used to receiving. Who will manage these companies then? That's right, the U.S. government's hand-pick by obama bureaucrats.

Now, where do you work and what do you do ???



posted on Oct, 21 2009 @ 05:16 PM
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On the surface it sounds good to restrict the bonus ammounts...



but where will the $40+ billion go if not to the people which produced the 'profits'...

sure they networked, pulled-strings, cut corners, to get the Company Profits and their clients a cut-of-the-Profits.

but if the Govt intervenes...reduces the pay-outs to the many execs & brokers that stirred-the-waters to create the massive trading-investing markets.

Then -> just where do the profits go?
Into the financial Firms Treasury???

~or is anyone suggesting the Govt should share in the massive profits,
even after the Firm paid-back the TARP money already ?? ~

Should the'excessive profits' be taxed at a higher rate thus reducing the ammount of obscene profits to be divided among the many Executives ?


too many questions,
the Firms made obscene profits as a result of Fed/Treas. actions
the obscene profits also come from the inaction of the SEC and NON-regulation of the fraudlent derivatives that are still being created at a rate near $100 billion per year
the 'profits' are from unloading the trillion$ of derivatives/CDOs/CDSs
'swaped' to the FED at face value instead of the 10 cents they are actually worth!


uh-huh----i'm all fed up
(did you recognize my Elvis impersonation?)



posted on Oct, 21 2009 @ 05:36 PM
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Originally posted by sylph hugger
Too much government meddling in private industry.


They temporarily lost the status of "private industry" when they accepted the bailout money. Until they pay back the money they borrowed, they should be under strict compensation rules. I'm very glad this is happening.

The money that was going to go to executive bonuses should come back to us in the form of tax cuts, but some of it will go to them in the form of stock.




For many of the executives, the cash they would have received will be replaced by stock that they will be restricted from selling immediately.


What makes you think they have already paid back the TARP money?



posted on Oct, 21 2009 @ 05:47 PM
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Originally posted by Benevolent Heretic

What makes you think they have already paid back the TARP money?


Good point. I've read that banks (and other companies?) trying to pay back the TARP are being refused. Could the reason be that the obama administration does not want to lose the leverage to make salary and other decisions for these companies? Now there's a real catch-22.

And no one seems to want to addess the constitutional authority question - which should be the first question addressed.



[edit on 10/21/2009 by centurion1211]



posted on Oct, 21 2009 @ 05:56 PM
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Originally posted by Benevolent Heretic

Originally posted by sylph hugger
Too much government meddling in private industry.


They temporarily lost the status of "private industry" when they accepted the bailout money. Until they pay back the money they borrowed, they should be under strict compensation rules. I'm very glad this is happening

I agree absolutely, if and when they pay back the tarp money well that's another story, in fact these companies should let the big bucks trickle down to their employees at the bottom of the food chain, what do you think a Teller makes, peanuts I can assure you.



posted on Oct, 21 2009 @ 06:07 PM
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Originally posted by Benevolent Heretic
What makes you think they have already paid back the TARP money?


Oh I dunno, headlines like these, perhaps?

JPMorgan and 9 Other Banks Repay TARP Money
dealbook.blogs.nytimes.com...

Goldman 'warrants' raves from Congress
money.cnn.com...

J.P. Morgan, Goldman, Morgan Stanley, others repay TARP
www.marketwatch.com...

You were saying?



posted on Oct, 21 2009 @ 07:57 PM
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Now I am all for a company that pays back TARP funds being able to pay their employees and executives whatever they want.

But what I want to know is, are these profits the result of the cash infusion by us taxpayers, and if so, as investors do we not deserve our dividends?

Yes they paid the money back but was it due to that money that they were able to report a profit?

Give Caesar what belongs to Caesar.

Otherwise, it's none of my business nor is it the government's business how much they pay anyone.



posted on Oct, 21 2009 @ 08:09 PM
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Originally posted by sos37

Oh I dunno, headlines like these, perhaps?

JPMorgan and 9 Other Banks Repay TARP Money
dealbook.blogs.nytimes.com...

Goldman 'warrants' raves from Congress
money.cnn.com...

J.P. Morgan, Goldman, Morgan Stanley, others repay TARP
www.marketwatch.com...


These aren't the companies in question. The ones that have been named are:


The companies are Citigroup, Bank of America, the American International Group, General Motors, Chrysler and the financing arms of the two automakers.


These have not repaid the TARP money yet.

It's not like the companies that are being penalized are headed by captains of industry. These are not premier capitalists but people who have run their companies into the ground.

I wish somebody would hire ME to lose billions of dollars for them. I'm sure I could do a very good job of it.

I'd even settle for less than a million a year.



posted on Oct, 21 2009 @ 08:12 PM
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reply to post by Sestias
 


I wish I could believe this but so far even after the bailout the too big to fail corrupted companies were paying compensations and enjoy themselves on California spas.

This corrupted rats are beyond the law.



posted on Oct, 21 2009 @ 10:25 PM
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Some more commentary on the issue:

newsbusters.org


Roland Martin Hits Obama From the Left on Executive Pay: 'It's About Time!'
By Matthew Balan (Bio | Archive)
October 21, 2009 - 18:06 ET
CNN political analyst Roland Martin ripped President Obama from the left on Wednesday’s Newsroom, after the White House announced that they were going to cut the pay of top executives at corporations which took taxpayer money from the federal government for bailouts: “It’s about damn time. The White House, frankly, has been slow in actually making this happen.”

Near the end of the 3 pm Eastern hour, anchor Rick Sanchez broke the news about the Obama administration’s decision to “put the kaputs on some of these big-timers with some of these Wall Street firms like AIG, and they are apparently going to ask them to take a cut in annual salaries of their 25 highest paid executives by an average...of 90% from last year.” Sanchez brought on Martin to comment on this breaking news, and the analyst’s reaction was unequivocally critical of the administration’s inaction in going after executive pay.

Please visit the link provided for the complete story.


I second that: "It's about @#! time!"



posted on Oct, 21 2009 @ 10:37 PM
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Another one:

Cramer To Wall Street Execs To Be Hit By Obama's Draconian Pay Restrictions: Let Them Eat Muni Bonds

news busters.org



[edit on 21-10-2009 by Sestias]



posted on Oct, 21 2009 @ 10:42 PM
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So when are they going to hit the evilest of all evilest, Goldman Sachs?

I_R



posted on Oct, 21 2009 @ 10:48 PM
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reply to post by idle_rocker
 


I think they've already paid back at least some of the bailout money. But I agree, they deserve to suffer more.



posted on Oct, 21 2009 @ 10:52 PM
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Oh they paid it back, all in good time too. But Paulsen made sure they were sitting pretty before he left office. Did they need TARP? I doubt it. I wonder what that audit of the FED that Bernanke testified would rattle the markets if they with forward with? Hmmm I just wonder.

I_R



posted on Oct, 22 2009 @ 07:57 AM
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Originally posted by sos37
You were saying?


I was saying, what makes you think THESE companies have paid back the TARP money?

------------------------------

I was talking about this story with my husband last night and seeing as how these companies have PROVEN that they don't know how or won't act honorably with their money AND that they have the power to bring the economy to its knees, is it really wise to let them go, unregulated again? Yes, they're private industry, but doesn't the government have the responsibility to protect the people?

These companies have proven that, unrestricted, they take advantage of people and make outrageous profits which they share only with their top executives, while irresponsibly making money off other people's money. I wouldn't care if their practices had no effect on us (the people), but behavior like this nearly sunk our economy last year. Don't we who are affected, have the right to step in and say, "No, you can't do that again"?

I mean, the government steps in and regulates other industries to protect the people. How would you like to go to the grocery story and buy meat or milk that had no government regulations enforced on it?

So, to me, as long as these companies act with irresponsibility that affects the people of this nation, I think it's the government's responsibility to make sure another financial collapse doesn't happen again. And if that means regulating the companies that have PROVEN that they can't do it themselves, then I'm all for it, even AFTER they pay back the TARP money.



posted on Oct, 22 2009 @ 01:45 PM
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I was expecting to see more ATS posters on this.

This is great news.

Greedy executives who get big fat bonuses and vacation trips while millions of people are suffering do not deserve it.

And as Benevolent Heretic said, the companies no longer have a say in what happens to that money.

They accepted the bailout money to help out their companies, not to waste it on each other.



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