In all this talk about bank bailouts the past few months, I’ve been wondering who in the pluperfect hell was looking out for my interests. (I am, among other things, now an involuntary shareholder of AIG, so I do have some skin in this game.) Somebody must be, because somehow, this little bit of populist law-writing managed to slip past the GOP and Blue Dog succubi and make its way intact into the stimulus bill:
The bill, which President Obama is expected to sign into law next week, limits bonuses for executives at all financial institutions receiving government funds to no more than a third of their annual compensation. The bonuses must be paid in company stock that can be redeemed only when the government investment has been repaid. …
Unlike the rules issued by the White House, the limits in the stimulus bill would apply to top executives and the highest-paid employees at all 359 banks that have already received government aid.
Now that’s what I’m talking about. And cue the whining in 3 … 2 … 1 …
“This is a big deal. This is a problem,” said Scott Talbott, chief lobbyist for the nation’s largest financial services firms. “It undermines the current incentive structure.”
These would be the financial-services firms and “current incentive structure” that got us into this mess in the first place. Plus which, I’m sorry, but you want a bonus to, you know, do your job? So pardon me if I’m not a total believer in the judgment, competence and integrity of those for whom the troubled and troubling Mr. Talbott speaks.
But wait! There’s more!
The stimulus bill also would require the 359 financial institutions to hold a “say on pay” vote at their shareholder meetings until the government funds were returned. The provision, which activist shareholder groups have sought in recent years, is essentially an annual up-or-down vote on executive pay packages …
… and would be nonbinding.
A common argument from executives against reining in huge Wall Street bonuses is that it would cause the most talented to flee to hedge funds and private equity groups. The free market, they say, should dictate pay levels.
Ah, yes, that free market again. That would be the same free market that just gave us the biggest financial crisis since the Great Depression. Now there’s a finely tuned and reliable barometer. Have you people not yet figured out that blind free-market ideology doesn’t work? Hell, even Alan Greenspan has finally wrapped his head around that. But then, as everyone has said about Alan Greenspan, including Alan Greenspan, he’s smarter than you.
Here’s the deal. If you’re going to work for an outfit that I and other taxpayers own, insure, prop up and bail the hell out, then you can just suck it up. You’re probably still overpaid as it is. If you were so hot to make all that money, and if there really were all these jobs in private-equity firms and hedge funds, you’d've been gone by now anyway. So sit down, shut up and do your damn job.