What is Obama doing? » bailout

Day 61: Bailout executives panic – House passes 90% tax on bonuses

Niklas — Fri, 20 Mar 2009 17:14:53 +0000

As if jumping executives from the roofs of bank and wall street buildings wasn’t enough of a public sidewalk hazard, the House overwhelmingly passed a near total tax on bonuses paid to employees of AIG and other bailout biters. And to really nail the coffin – it’s retroactive.

The faces of Evil according to bank executives.

The House vote sent some employees into a panic about the prospect of, in effect, having to give up money they might already have spent. And it had regulators fearing it could undermine the Treasury’s efforts to stabilize the financial system if banks tried to flee the bailout program or if other firms refused to participate in coming rescue operations to protect their bonuses, some executives said.

Story on NYTimes

Ps! If you happen to be a sad executive, here’s a little tax free bonus from us on WIOD: the streamed Leno interview with Obama.

Day 14: Plans to put a limit on executives’ pay and bonuses

Niklas — Wed, 04 Feb 2009 14:40:54 +0000

The Obama administration is expected to impose a cap of $500,000 for top executives at companies that receive large amounts of bailout money, according to people familiar with the plan.

Executives would also be prohibited from receiving any bonuses above their base pay, except for normal stock dividends.

…

“That is pretty draconian — $500,000 is not a lot of money, particularly if there is no bonus,” said James F. Reda, founder and managing director of James F. Reda & Associates, a compensation consulting firm.

WIOD comment: $500,000 might not be a lot of money to some, but ask the fabled “man on the street” and you might get a different answer. While we don’t expect anything else than a loophole, its a nice symbolic gesture.

Link to NY Times article.

Day 10: Pressures Wall Street and reverses labor policies

Niklas — Fri, 30 Jan 2009 21:18:57 +0000

President Obama branded Wall Street bankers “shameful” on Thursday for giving themselves nearly $20 billion in bonuses as the economy was deteriorating and the government was spending billions to bail out some of the nation’s most prominent financial institutions.

“There will be time for them to make profits, and there will be time for them to get bonuses,” Mr. Obama said during an appearance in the Oval Office with Treasury Secretary Timothy F. Geithner. “Now’s not that time. And that’s a message that I intend to send directly to them, I expect Secretary Geithner to send to them.”

Story on NYTimes

At a White House ceremony, the president signed three executive orders that he said would “reverse many of the policies towards organized labor that we’ve seen these last eight years, policies with which I’ve sharply disagreed.”

The orders he signed, which union officials say will undo Bush administration policies that tilted toward employers, would require federal contractors to offer jobs to current workers when contracts change, and would make it more difficult for federal contractors to discourage union activities.

Story on NYTimes

Day 7: Citibank are told to stop insane spending

Niklas — Tue, 27 Jan 2009 18:54:45 +0000

The administration today placed a phone call to Citibank, who received $45 billion in goverment bailout, about their plans to buy a new $50 million corporate jet. They were told to “fix it”.

The New York Post’s Jennifer Keil and Chuck Bennett reported in Monday’s paper that Citigroup, which has received $45 billion in government bailout funds, is about to upgrade to a new $50 million, twelve-seat corporate jet.

The high-flying execs at Citigroup caved under pressure from President Obama and decided today to abandon plans for a luxurious new $50 million corporate jet from France.

Story on ABC news
Story on Huffington Post