Politics | 02/04/2009 9:45 am

Obama Seeks Salary Cap for Bailed-Out Bank Execs

By The Staff at wowOwow.com

Executives whose companies received bailout bucks should expect to see smaller paychecks soon.

President Obama today imposed a $500,000 pay cap on executives whose firms receive government financial rescue funds. He made the official announcement this morning, ahead of next week’s unveiling of a new framework for spending what remains of the $700 billion financial rescue fund. The rules will force greater transparency on the use of corporate jets, office renovations and holiday parties, as well as any big financial packages executives may get when they leave companies.

"For top executives to award themselves these kinds of compensation packages in the midst of this economic crisis isn’t just bad taste - it’s a bad strategy - and I will not tolerate it as president," Obama said at the White House with Treasury Secretary Timothy Geithner. "We’re going to be demanding some restraint in exchange for federal aid — so that when firms seek new federal dollars, we won’t find them up to the same old tricks."

The rules apply to companies that receive "exceptional financial recovery assistance" - like AIG, Bank of America, Chrysler, General Motors and Citigroup. Exceptions can be made for some grants of stock or other long-term incentives.

"We’ve now learned that people are still getting huge bonuses despite the fact that they’re getting taxpayer money, which, I think, infuriates the public," Obama told CNN Tuesday. It sure infuriates us, as well as the hard-working people paying for that bailout!

The move isn’t altogether unexpected. After all, despite the banks begging, hat in hand, for a government handout — courtesy of the American taxpayers — we’re still hearing about things like Citigroup spending $50 million on a new jet, and how Wall Street handed out $18 billion in bonuses last year. Obama called that latter move "shameful." Then there’s the news today that Wells Fargo — which got $25 billion in bailout money — canceled a pricey Las Vegas casino trip for employees only after a mountain of criticism came in. Will these guys ever learn?!

105 Reader Comments (so far…) Sign In or Register to comment

At least Obambi is getting all the demos to pay their taxes. They’ve been stealing long enough.

By alex harvey on 02/05/2009 5:41 pm

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By Libra Lady on 02/04/2009 3:17 pm This the type biased crap that burns my biscuits. I saw an article on how much republicans spent on their retreat. You want to post that too? Or will I have to do that ?

By starry Nite on 02/04/2009 11:13 pm

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starry…better get those biscuits out of the oven….something is burning….just sayin’

By Libra Lady on 02/04/2009 11:18 pm

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Libra Lady, I know that republicans spend taxpayer dollars for retreats also but The Hill only published the Dems dollar amount. But then that is par for the course. You took the opportunity to further spread bias or BS.

By starry Nite on 02/04/2009 11:58 pm

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Hey…I learned well from msnbc and huffpo…now there is some BS…I’m just sayin’

By Libra Lady on 02/05/2009 12:01 am

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Somebody called these banking presidents mischievous. If knew my salary was being capped, its time to look elsewhere. This is the start of socialism. Maybe you want your government knowing how times you use the john everyday. How much bread you can buy. Obambi will ruin this country, like all other Chicago politcians have ruined everything they touch.

By alex harvey on 02/04/2009 4:16 pm

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When the feds own the banks…then they control the salaries…socialism at it’s finest….it’s just now starting….

By Libra Lady on 02/04/2009 10:16 pm

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Libra, tax cheats ? greedy bankers=

By starry Nite on 02/04/2009 11:59 pm

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Here is some Change we can believe in! Obama To Sign SCHIP Wednesday Giving 4 Million More Children Health Coverage “Washington, D.C.(AHN) - President Barack Obama is scheduled to sign into law on Wednesday a bill expanding the State Children’s Health Insurance Program (SCHIP) to give health coverage to 4 million more children. The President will sign the measure at 4:30 pm ET in the East Room of the White House. He will be joined by Vice President Joe Biden, according to the White House. The Senate passed the Children’s Health Insurance Program Reauthorization Act of 2009 last Thursday by a vote of 66-32, with nine Republicans voting in favor of the measure. The House passed its own version of the measure on Jan. 14 by a vote of 289-139. The SCHIP reauthorization bill expands coverage to 4 million more children at the cost about $33 billion over the next 4 1/2 years. The program currently covers 6.7 million children. A similar bill had been vetoed by former President George W. Bush last year.”

By DeBúrca obj on 02/04/2009 5:06 pm

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DeB, I’m so happy to read this, it’s a wonderful start.

By Catherine Kaiman on 02/04/2009 5:53 pm

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What’s going to motivate these children to go out and get jobs if we just GIVE them basic health insurance? Think of the children people!

By Rush L on 02/04/2009 7:52 pm

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True… and all those moms working at Starbucks just for the health insurance may decide to just stay home and raise their children instead of spending their whole paycheck on childcare.

By DeBúrca obj on 02/04/2009 11:55 pm

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There’s a lot of yelling and screaming going on about this, including accusations that this is approaching socialism. Well, as someone else said, if a bank loans money, there are strings attached. With large commercial loans, the borrower must abide by all kinds of financial covenants.

By Marina B. on 02/04/2009 6:47 pm

This is a dangerous precedent to set—it’s something Hugo Chavez would do—and we all know how that ends up. I realize there is a lot of populism in this—but be careful what you wish for. I knew they would use the bail out to excuse this gross power grab—libs have wanted salary caps long before the bailouts. These idiots never should have taken the bailout money—live free or die! Interesting, Obama wants complete transparency on how private businesses use their funds—only some of which belongs to taxpayers, but Congress has been less than transparent spending money that completely belongs to the taxpayer. How would you like to get a home equity loan and have the bank decide how you spend it?

By eleanor roche on 02/04/2009 7:11 pm

Eleanor — I do believe that there should be some accounting as to how the money is spent as far as the bail-out companies are concerned. Some of these companies that were given the money didn’t want the money so I agree the idiots should never have taken the money. The old adage of “sounds too good to be true” certainly applies to those who went along. What happened to digging in, cutting costs and getting yourself out of the mess you created. Owning a business myself I certainly don’t want anyone teling me how much money I can make this year or any year. Especially since small businesses have up and down years. So there are a lot of Americans asking the question, who’s next? For the last few years we have done pretty well — now, we are hanging on like many other small businesses out there. The only people I want to report to is the IRS each year when we file our tax returns. And, I might add, the Federal Government certainly gets their share from us each year. Transparency? Congress should be more transparent with the American people on how they are in a “nanny ” state from election to death. If they want busineses to report their earnings, etc. then let Congress release their personal salaries, perks, etc. and let us decide what their salaries should be. I don’t want anyone, ESPECIALLY the Federal Government telling me how to do anything - I’d rather live free!

By Lady Gator on 02/04/2009 7:56 pm