Quote :

"WASHINGTON – Bowing to populist anger, the House voted Friday to prohibit pay and bonus packages that encourage bankers and traders to take risks so big they could bring down the entire economy. Aware of voter outrage about the bonuses, Republicans were reluctant in Friday's debate to push back, even though they voted overwhelmingly against the bill. They said severe restrictions should apply only to banks that accept government aid. The legislation's ban on risky compensation would apply to any firm with more than $1 billion in assets, including bank holding companies, broker-dealers, credit unions, investment advisers and mortgage buyers Fannie Mae and Freddie Mac. "Obviously it has some important things that we think need to become law, and we'll take a look at the full bill," White House spokesman Robert Gibbs said Friday. The legislation includes President Barack Obama's suggestion that shareholders get a nonbinding vote on compensation packages. It also would prohibit members of compensation committees from having financial ties to the company and its executives, as Obama wanted. Rep. Barney Frank, chairman of the House Financial Services Committee, said the extra regulation would ensure that bankers and traders who take big risks and lose on them don't continue to get rewarded anyway. Without such restraint, "the company loses money and the economy may suffer, but the decision makers do not," said Frank, D-Mass."

Again, where does the congress get any authority to set pay limits on workers? Sorry, Barney, the gov't is not in charge of the economy. It was never designed to be in charge of the economy.

And Obama and Franks don't want organizations setting their own executive pay? Then why is congress allowed to set their own pay and give themselves raises?

http://news.yahoo.com/s/ap/20090731/ap_on_go_co/us_bailout_bonuses

[Edited on August 1, 2009 at 10:51 PM. Reason : .]

[Edited on August 1, 2009 at 10:51 PM. Reason : ..]

8/1/2009 10:50:29 PM

This seems like good legislation.

The relationship between executives and their boards are ridiculously incestuous. The SEC already regulates this arena. As far as I can tell from a scan of the article, they're just changing rules-- not expanding power.

8/1/2009 11:14:24 PM

barney frank needs to be tarred and feathered

although he might get off on that

8/2/2009 2:21:08 PM

Yeah, this is dumb, unconstitutional, and just all around un-American.

I'm fine with making sure shareholders have more say, since a large chunk of shareholder power is held by institutions (mutual funds, pensions, etc) that are actually run by people who have a clue.

The only real problem with many of the compensation packages is that they reward short term performance too much, or use the wrong metric for deciding bonuses. If you give the CEO 10 million extra bucks for raising the stock price 10% in a year, then yeah, you're going to encourage them to make some dumb decisions as far as the long term prosperity of the company is concerned.

8/2/2009 2:46:47 PM

So you've said it was dumb and un-American and then went on to agree with the premise of the bill?

I'd be in favor of letting companies fail when they've failed, but what we've learned time and time again is those on Wall Street are collectively a ton smarter than those in DC and those attempting to regulate them, getting into a position where they are "too big to fail".

Ideally, there has to be some other way to keep a too big to fail situation from happening, rendering this legislation pointless.

Having said that a large majority of these investment houses doling out huge bonuses have done so because of

1) Bailouts by the taxpayer
2) A ceasing of mark to market rules that would render many of them instantly insolvent

I'm a fan of putting a tight leash on big bonuses during this recessionary period because these companies are able to give them out thanks to the generosity of the American taxpayer and the craftiness of the Goldman Sachs conglomerate having all the right people in all the right places.

8/2/2009 3:05:36 PM

^ umm, where did I agree with the premise that Congress should be allowed to cap/control the amount a privately employed person is paid?

[Edited on August 2, 2009 at 3:10 PM. Reason : or control, so some fucktard doesn't argue with me on semantics]

8/2/2009 3:09:35 PM

Right here

Quote :

"The only real problem with many of the compensation packages is that they reward short term performance too much, or use the wrong metric for deciding bonuses. If you give the CEO 10 million extra bucks for raising the stock price 10% in a year, then yeah, you're going to encourage them to make some dumb decisions as far as the long term prosperity of the company is concerned."

8/2/2009 3:14:30 PM

Dude, you need to learn some reading comprehension.

8/2/2009 3:16:07 PM

Do you know what "premise" means? They are wanting to limit compensation because it has gone out of control on the back of risky betting. Then you agreed that CEOs are incentivized to make risky bets.

Don't be an idiot.

[Edited on August 2, 2009 at 3:25 PM. Reason : .]

8/2/2009 3:24:51 PM

You're arguing semantics with me. I was attacking the idea of congress regulating private compensation.


Troll trolll troll your Fail Boat, gently down the stream....

[Edited on August 2, 2009 at 3:43 PM. Reason : .]

8/2/2009 3:43:16 PM

What about we take care of the issue by NOT bailing out companies that take these "risky" gambles that end up going south bankrupting the company.

If I take a risk buying a $200k house then lose by 6-figure job; the only "bailout" i will be getting is my ass to the homeless shelter.

8/2/2009 4:13:43 PM

So the rules are good ideas, but Congress shouldn't do it?

Because... they just shouldn't?

This isn't even a gray area when it comes to the Constitution, either. Interstate commerce clause ftw.

8/2/2009 4:34:36 PM

are you comparing buying a 200k house to the dealings of a multinational corporation?

[Edited on August 2, 2009 at 4:37 PM. Reason : ]

8/2/2009 4:37:20 PM

Quote :

"You're arguing semantics with me. I was attacking the idea of congress regulating private compensation."

Absolutely not. Yes, you did attack the idea of congress regulating 'private' compensation, ignoring for a moment that many of these 'private' companies now exist in their current form thanks to taxpayers. At the same time, you implicitly agreed with the premise of the bill, that premise being big bonuses caused risky behavior. You said it yourself. You can agree with congress on their idea and disagree with their implementation of a fix. No one is trolling, stop using that as a lame defense for getting destroyed in a discussion.

8/2/2009 5:04:18 PM

Yes. Interstate Commerce clause surely means you can set prices. do you even believe half of the bullshit you spew?

8/2/2009 10:29:58 PM

Nixon enacted wage/price controls it to combat inflation.

So did FDR. Truman got permission from Congress to do it, but backed down, IIRC. I'm fairly certain Wilson did it during WWI, too.

8/2/2009 11:24:19 PM

^
Nixon abandoned conservative theory and it came back to bite him:

Quote :

"This time, however, it was apparent that the control system was not working. Ranchers stopped shipping their cattle to the market, farmers drowned their chickens, and consumers emptied the shelves of supermarkets. Nixon took some comfort from a side benefit that George Shultz, at the time head of the Office of Management and Budget, identified. "At least," Shultz told the president, "we have now convinced everyone else of the rightness of our original position that wage-price controls are not the answer." Most of the system was finally abolished in April 1974, 17 months after Nixon's triumphant reelection victory over George McGovern -- and four months before Nixon resigned as president."

-- Excerpt from "The Commanding Heights" by Daniel Yergin and Joseph Stanislaw, 1997 ed

8/3/2009 1:01:06 AM

I didn't say it was a good thing. Only that it's allowed and that there is precedent.

8/3/2009 1:07:32 AM

Quote :

"This isn't even a gray area when it comes to the Constitution, either. Interstate commerce clause ftw"

The original intent of the ICC was to ensure free trade among the states. It is only because of the creative minds of subsequent judges that the ICC has been broadened to cover just about everything under the sun. Thus, if interpreting the ICC as it was ratified by the states, regulating pay falls outside the purview of the ICC and is thus unconstitutional.

8/3/2009 6:48:51 AM

Quote :

"I didn't say it was a good thing. Only that it's allowed and that there is precedent."

FDR interred the Japanese. I'm pretty sure that wasn't Constitutionally kosher. Bush authorized torture. Very sure that one wasn't cool.

Just because "the president did it" does not automatically make it legitimate.

8/3/2009 7:20:13 AM

How dare you talk ill of FDR

8/3/2009 7:29:28 AM

Quote :

"How dare you talk ill of FDR"

Funny how you lionize him more than liberals. FDR would have been awesome if he were a real socialist.

8/3/2009 10:31:17 AM

Quote :

"Just because "the president did it" does not automatically make it legitimate. "

Thank you.

8/3/2009 10:44:01 AM

Quote :

"So the rules are good ideas, but Congress shouldn't do it? Because... they just shouldn't? "

Well yes. There are a lot of things that are great ideas that congress specifically and the government in general have no fucking business in. Like sex, making lifestyle choices that ostracize you from society, seatbelts, building a house in an area that's below sea level, what substances you ingest, deciding to bet it all on 17 and then letting it ride etc etc etc.

8/3/2009 7:08:16 PM

Quote :

"building a house in an area that's below sea level"

actually congress does have a right when it is their ass choppering you out of hurricane flood waters when your house goes under. For the other issues you may have a case.

8/3/2009 8:37:04 PM

Quote :

"actually congress does have a right when it is their ass choppering bailing you out of hurricane flood waters bankruptcy when your house corporation goes under."

8/3/2009 10:48:33 PM

Congress has NO right to bail out any company from bankruptcy...even if it means a lot of votes for the politicians doing the bailing (with our tax money)

8/3/2009 11:34:15 PM