A couple of months ago as the bank bail out went ahead, Naomi Klein piped up and said she thought it was a travesty as the bailout money went to pay the bonuses for the executives for these failing banks. She wasn't wrong about it as it turns out.
Banks that are getting taxpayer bailouts awarded their top executives nearly $US1.6 billion ($2.34 billion) in salaries, bonuses and other benefits last year, an AP analysis reveals.
The rewards came even at banks where poor results last year foretold the economic crisis that sent them to Washington for a government rescue. Some trimmed their executive compensation due to lagging bank performance, but still forked over multimillion-dollar executive pay packages.
Benefits included cash bonuses, stock options, personal use of company jets and chauffeurs, home security, country club memberships and professional money management, the AP review of federal securities documents found.
The total amount given to nearly 600 executives would cover bailout costs for many of the 116 banks that have so far accepted tax dollars to boost their bottom lines.
Representative Barney Frank, chairman of the House Financial Services committee and a longstanding critic of executive largesse, said the bonuses tallied by the AP review amount to a bribe “to get them to do the jobs for which they are well paid in the first place.
“Most of us sign on to do jobs and we do them best we can,” said Frank, a Massachusetts Democrat. “We’re told that some of the most highly paid people in executive positions are different. They need extra money to be motivated!”
The AP compiled total compensation based on annual reports that the banks file with the Securities and Exchange Commission. The 116 banks have so far received $US188 billion ($275.42 billion) in taxpayer help.
Among the findings:
-The average paid to each of the banks’ top executives was $US2.6 million ($3.8 million) in salary, bonuses and benefits.
-Lloyd Blankfein, president and chief executive officer of Goldman Sachs, took home nearly $US54 million ($79 million) in compensation last year. The company’s top five executives received a total of $US242 million ($355 million).
This year, Goldman will forgo cash and stock bonuses for its seven top-paid executives. They will work for their base salaries of $US600,000 ($880,000), the company said. Facing increasing concern by its shareholders on executive payments, the company described its pay plan last spring as essential to retain and motivate executives “whose efforts and judgments are vital to our continued success, by setting their compensation at appropriate and competitive levels”. Goldman spokesman Ed Canaday declined to comment beyond that written report.
The New York-based company on December 16 reported its first quarterly loss since it went public in 1999. It received $US10 billion ($14.65 billion) in taxpayer money on October 28.
-Even where banks cut back on pay, some executives were left with seven- or eight-figure compensation that most people can only dream about. Richard D Fairbank, the chairman of Capital One Financial Corporation, took a $US1-million ($1.46 million) hit in compensation after his company had a disappointing year, but still got $US17 million ($25 million) in stock options. The McLean, Virginia-based company received $US3.56 billion ($5.2 billion) in bailout money on November 14.
-John A Thain, chief executive officer of Merrill Lynch, topped all corporate bank bosses with $US83 million ($122 million) in earnings last year. Thain, a former chief operating officer for Goldman Sachs, took the reins of the company in December 2007, avoiding the blame for a year in which Merrill lost $US7.8 billion ($11.4 billion). Since he began work late in the year, he earned $US57,692 ($84,500) in salary, a $US15-million ($22 million) signing bonus and $US68 million ($100 million) in stock options.
Like Goldman, Merrill got $US10 billion ($14.7 billion) from taxpayers on October 28.
The AP review comes amid sharp questions about the banks’ commitment to the goals of the Troubled Assets Relief Program (TARP), a law designed to buy bad mortgages and other troubled assets. Last month, the Bush administration changed the program’s goals, instructing the Treasury Department to pump tax dollars directly into banks to prevent wholesale economic collapse.
The program set restrictions on some executive compensation for participating banks, but did not limit salaries and bonuses unless they had the effect of encouraging excessive risk to the institution. Banks were barred from giving golden parachutes to departing executives and deducting some executive pay for tax purposes.
I'm tempted to quote the whole damn article but I will refrain.
I went to see Walk-offHBP play baseball and I ran into a guy who now works for JP Morgan in Sydney. Naturally I asked him how he was finding the GFC, and he told me that JP Morgan was relatively fine so far. He said that he wasn't senior enough in the chain to be targeted for cuts, and he wasn't junior to be cut out of hand. In short, he was being paid about what the bank could afford for the work he does - which he jokingly said was nothing too serious.
"But some of these senior guys getting $5m a year? Who the hell is worth that in any market? Seriously, they should be paying me that. Now. Like, as in, He's going to work hard, pay him as much as we got. This old fart who's over it and isn't hungry? Fuck him off quick."
Then he stepped out to bat and drew a walk on 5 pitches. It was pretty cool. Our old club philosophy was OBP, walks and waiting for 3-run homers, which did happen as I watched. That's another story. :)
Back to the point, which is: some of these dufuses who had their shareholders duped are running off with tax-payers money for their friggin' bonuses. Get that. You've run your company into the ground through idiotic management, asked for government money by the truckload and instead of using it fix the company, you pay yourself a bonus! A BONUS! For what?
One never ceases to be amazed.
No comments:
Post a Comment