New Rule: If your a CEO and your company

[Quiksilver]

NYT Article

What an interesting twist.
In my opinion 1/2 a million dollar salary cap is way more than these failed businesses and their CEO's deserve but I suppose it's better than nothing.

(If it's a repost sorry, but I got nothing in the search results.)

 

[First]

CEO compensation is always a good idea if it's reasonable, as getting half a billion over 5 years after your company goes bankrupt makes little financial sense from the perspective of shareholders who are suddenly screwed over. And the whole way public offerings are set up is precisely to benefit shareholders. I agree and disagree about bonus' though, because a lot of bonuses are doled out to people who did their jobs perfectly acceptably (people making reasonable incomes of even just $40K), having had nothing to do with decisions at the very top. These middle income workers factor in and depend on bonuses, especially in the financial world, and so many shouldn't have them pulled out from under them due to CEOs and the like hoarding cash they didn't actually deserve given their horrid performances.

Overall, this may end up being a good evolution of keeping businesses more honest and evening the playing field more knowing that taxpayer dollars, which we'll get back anyway plus interest, are being attached with conditions. Just make sure they're the right conditions.

 

[StageLeft]

A bit too late for this now, isn't it? So much of the money has already been released.

 

[Aegeon]

Originally posted by: Skoorb
A bit too late for this now, isn't it? So much of the money has already been released.

Only the first half of the 700 million has actually been distributed, so this is still a potentially significant step as far as consequences for CEOs of companies taking bailout money is concerned.

 

[Vette73]

Originally posted by: Aegeon

Originally posted by: Skoorb
A bit too late for this now, isn't it? So much of the money has already been released.

Only the first half of the 700 million has actually been distributed, so this is still a potentially significant step as far as consequences for CEOs of companies taking bailout money is concerned.

Esp since so many that got money first round wasted it and probable thought they could get more the 2nd half. Now their hands are tied.

 

[DisgruntledVirus]

If only they could have started this last year.

 

[Chunkee]

like closing the gate after the horse has already ran out....typical..trying to show semblance of proactive pursuits...good for PR but hopefully it is not fooling anyone... just crap any way like the rest of it....place all the rules and bills up...all you want...but if they are not enforced, what good are they? hand slaps and shame on yous is all they get....how about hard labor for 10 years?

 

[The-Noid]

This is sad in two ways.

From a democratic side, the government should have had regulations in place that made the many things that were done in Wall Street and Main Street banks to not have taken place. The fact that they did was from lax regulation on the part of regulators.

From a republican side, this is as close to nationalization of any industry you will see.

 

[CLite]

Originally posted by: Skoorb
A bit too late for this now, isn't it? So much of the money has already been released.

Just to add more information, they are going to apply this to institutions that recieved huge emergency packages in addition to just TARP funds. So citi/AIG/etc. will now be forced to meet this limit even if they don't further draw into the TARP funds.

Furthermore, Obama is proposing greater transparency between executive pay and the common shareholder (i.e. greater individual shareholder rights). Right now most little shareholders forfeit their rights to large fund managers, I imagine this is going to change.

Both good changes, however the new Attorney General has already stated he won't go on a witch hunt on the CEO's who got us into this mess and left with hundreds of millions. Oh well, can't get them all I suppose, but hopefully moving forward this shit will be diminished.

 

[Balt]

Good. If they can't deal with it they are free to seek employment elsewhere. Everyone else is being asked to roll up their sleeves and make sacrifices, and the vast majority of them aren't sitting on a fortune.

Also the belief that the skill needed to run these companies (into the ground) requires such a unique set of skills that you MUST pay them insane amounts of money is nonsense. I'm not saying it's easy, but it's not like only .00001% of people are capable of doing it.

 

[CADsortaGUY]

How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

 

[LegendKiller]

Originally posted by: CLite

Originally posted by: Skoorb
A bit too late for this now, isn't it? So much of the money has already been released.

Just to add more information, they are going to apply this to institutions that recieved huge emergency packages in addition to just TARP funds. So citi/AIG/etc. will now be forced to meet this limit even if they don't further draw into the TARP funds.

Furthermore, Obama is proposing greater transparency between executive pay and the common shareholder (i.e. greater individual shareholder rights). Right now most little shareholders forfeit their rights to large fund managers, I imagine this is going to change.

Both good changes, however the new Attorney General has already stated he won't go on a witch hunt on the CEO's who got us into this mess and left with hundreds of millions. Oh well, can't get them all I suppose, but hopefully moving forward this shit will be diminished.

All good things. I am very interested in the potential shareholder's rights change, something I've been very outspoken about.

 

[CLite]

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

 

[Arkaign]

Originally posted by: CLite

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

^^ This. I never thought the bailouts were a good plan, but if the public dime is used, then they have to follow some hard rules. Nothing for free.

 

[CADsortaGUY]

Originally posted by: CLite

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

Hold on there sparky. Where did I suggest I was against regulating what they do with the money? I addressed the socialist wet dream of capping exec salaries. How do they think they can do this if these execs have contracts? The expenses is a similar situation of enforcement especially if it continues to be politicized.

 

[microbial]

Originally posted by: Quiksilver
NYT Article

What an interesting twist.
In my opinion 1/2 a million dollar salary cap is way more than these failed businesses and their CEO's deserve but I suppose it's better than nothing.

(If it's a repost sorry, but I got nothing in the search results.)

Frankly, I like the 10X rule of compensation.

That is: whoever in your organization makes the least amount of compensation, that sets the base standard--and no-one can make more than 10X as much as that person.

So if your lowest earner makes 35K, then your highest earner cap in that organization would be 350K.

Bonuses and perks work the same going the other way. Whatever your highest earner gets in bonuses, say 100K, then lower wage earners would get a bonus equal to their percentage prorated. The 35K worker would get 10 % or a ten thousand dollar bonus. Ouch!

Call me crazy, but I've yet to be in an organization where the top earner was worth more than 10X the bottom earner. Most times the person that cleans the bathrooms is more valuable to that organization that anyone else there.

 

[Arkaign]

Originally posted by: microbial

Originally posted by: Quiksilver
NYT Article

What an interesting twist.
In my opinion 1/2 a million dollar salary cap is way more than these failed businesses and their CEO's deserve but I suppose it's better than nothing.

(If it's a repost sorry, but I got nothing in the search results.)

Frankly, I like the 10X rule of compensation.

That is: whoever in your organization makes the least amount of compensation, that sets the base standard--and no-one can make more than 10X as much as that person.

So if your lowest earner makes 35K, then your highest earner cap in that organization would be 350K.

Bonuses and perks work the same going the other way. Whatever your highest earner gets in bonuses, say 100K, then lower wage earners would get a bonus equal to their percentage prorated. The 35K worker would get 10 % or a ten thousand dollar bonus. Ouch!

Call me crazy, but I've yet to be in an organization where the top earner was worth more than 10X the bottom earner. Most times the person that cleans the bathrooms is more valuable to that organization that anyone else there.

That's actually pretty cool. If you can't make a decent living with 350k/year, you don't deserve 35 cents.

 

[Arkaign]

Originally posted by: CADsortaGUY

Originally posted by: CLite

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

Hold on there sparky. Where did I suggest I was against regulating what they do with the money? I addressed the socialist wet dream of capping exec salaries. How do they think they can do this if these execs have contracts? The expenses is a similar situation of enforcement especially if it continues to be politicized.

I think federal powers > corporate contracts, for better or for worse. Corps don't write the laws (though they've come very close with lobbyists polluting Washington).

I think we should ban lobbyists, ban PAC $$, and ban compaign contributions beyond $10 per individual, with ZERO $ allowed from any company, corporation, or otherwise.

 

[CADsortaGUY]

Originally posted by: Arkaign

Originally posted by: CADsortaGUY

Originally posted by: CLite

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

Hold on there sparky. Where did I suggest I was against regulating what they do with the money? I addressed the socialist wet dream of capping exec salaries. How do they think they can do this if these execs have contracts? The expenses is a similar situation of enforcement especially if it continues to be politicized.

I think federal powers > corporate contracts, for better or for worse.

I don't think there is a court (outside of California?) that would side with the gov't on this one. An employment contract isn't something that can be messed with by anyone on a whim.

 

[Xavier434]

Originally posted by: CADsortaGUY

Originally posted by: Arkaign

Originally posted by: CADsortaGUY
Hold on there sparky. Where did I suggest I was against regulating what they do with the money? I addressed the socialist wet dream of capping exec salaries. How do they think they can do this if these execs have contracts? The expenses is a similar situation of enforcement especially if it continues to be politicized.

I think federal powers > corporate contracts, for better or for worse.

I don't think there is a court (outside of California?) that would side with the gov't on this one. An employment contract isn't something that can be messed with by anyone on a whim.

Each and every bank is required to go through an application and approval process to receive the federal aid. All the Fed needs to do is add these restrictions to be apart of the agreement during the application process.

 

[Drakkon]

So we take away the salaries of the richest men in the country for what? 1 year? 2 years maybe? Or just until they find a loophole? Nice bone throw to the public who wont read any more into this, and will take it as the savior proclaiming victory.

This has tinges of socialism but due to our tax system and banking system and corporation system there will be loopholes that will make it capitalism once again.

 

[CLite]

Originally posted by: CADsortaGUY

Originally posted by: Arkaign

Originally posted by: CADsortaGUY

Originally posted by: CLite

Originally posted by: CADsortaGUY
How does BHO and his now glaringly socialist minions expect to enforce this - especially if some of these "senior execs" already have contracts. Also, how exactly is the Feds/BHO going to go over these expenses and say what is right or wrong.

Yet another slide down the slope...

Man... are you serious? I can totally understand if you are agaisnt bailouts in general. But are you truly agaisnt regulating what they do with the billions we give them? There is no slope, it's just responsible accounting of money that is being lent out.

Hold on there sparky. Where did I suggest I was against regulating what they do with the money? I addressed the socialist wet dream of capping exec salaries. How do they think they can do this if these execs have contracts? The expenses is a similar situation of enforcement especially if it continues to be politicized.

I think federal powers > corporate contracts, for better or for worse.

I don't think there is a court (outside of California?) that would side with the gov't on this one. An employment contract isn't something that can be messed with by anyone on a whim.

Agreed. I believe the path forward will be required consent from all people with packages greater than 500K before accepting bailout funds. The hard part will be AIG/Citi where they say they want to go after them even if they don't accept further TARP funds.

Finally to provide you more details, they are going to let dividend payments from previously owned stock to exceed the 500K. Regarding stock options they can be included *However* they won't have access to them until the federal government loans are paid back *fully*.

All very reasonable proposals imo, I think you are being a wee-bit paranoid about a librul agenda to transform executives salaries. All that is being proposed is a very logical control on the abuse of distributed loans that are meant to support the financial markets.

Controling expenses could be difficult I suppose, if they really try to develop abuses/workarounds they are going to be hammered hard with the current bad press they are already dealing with.

 

[Xavier434]

Originally posted by: Drakkon
So we take away the salaries of the richest men in the country for what? 1 year? 2 years maybe? Or just until they find a loophole? Nice bone throw to the public who wont read any more into this, and will take it as the savior proclaiming victory.

This has tinges of socialism but due to our tax system and banking system and corporation system there will be loopholes that will make it capitalism once again.

This is our tax money we are giving them. I think we should have a say on how it is spent. If they find loopholes then they find loopholes, but there is no guarantee that the loopholes that they do find will be very effective.

 

[CLite]

Originally posted by: Drakkon
So we take away the salaries of the richest men in the country for what? 1 year? 2 years maybe? Or just until they find a loophole? Nice bone throw to the public who wont read any more into this, and will take it as the savior proclaiming victory.

This has tinges of socialism but due to our tax system and banking system and corporation system there will be loopholes that will make it capitalism once again.

wuuuuuuuuuuuuuuuuuuuuuut. You think this has the "tinges???" of socialism but giving out hundreds of billions isn't socialism? Painting control of distributed funds as socialism shows how warped your perception of reality is.

 

[ProfJohn]

A LOT of you guys ARE crazy.

A $350k cap on salary?
A $500k cap on salary?

You guys are sitting there looking at your paycheck, be it 30k or 70k, and thinking WOW $350k is a LOT of money.

But you are not thinking in realistic terms.

We are talking about CEO's who are running companies with tens of thousands of employees and billions of dollars in revenue. You can't tell a guy running a billion dollar company that he is only worth $500k, that is crazy.

Look at AIG.
They have 116,000 employees and $110 billion in revenue. There is no way that a guy running that company is only worth $500k.

I do agree that there should be common sense limits on how much these guys make, but $500k is WAY to low.