Thursday, October 22, 2009

Salary Caps: SOME Deserve Them

Earlier this morning, a talkshow yapper railed on and on and on and on about how AWFUL it was that some BigBank managers' salaries were being slashed.

Yah, it's awful. /sarcasm.


Congressional investigators think that reams of internal documents turned over by Bank of America last Friday show that its executives were alarmed by mounting losses at Merrill Lynch well before shareholders voted to approve the merger, according to sources familiar with the matter.

Investigators also think the documents, combined with prior testimony and fresh interviews with a key executive, suggest that Bank of America chief executive Kenneth D. Lewis used the threat of backing out of the government-backed deal as leverage for billions more in taxpayer bailout money, the sources said.”

IOW, Lewis (and a number of OTHER BofA execs) knew that Merrill was tanking and would cost BofA a ton of money, so he extracted a corresponding amount from the taxpayers.

Sure, Lewis has been fired--he'll collect his salary until the end of this year (at least).

But go ahead. Justify paying those other guys large wads of salary and bonus, based on what you've seen above.

Justify paying AIG, Citi, WellsFargo (etc., etc.) all those multi-millions.

C'mon. You know you can, right??

Vox on the same topic with an excellent point at the end:

Look very closely at any commentator, so-called conservative or otherwise, who complains about this action by the White House being somehow "anti-capitalist". If he was also a supporter of the bailouts last November, you should never, ever, consider taking him seriously again, because he's either an untrustoworthy hypocrite or he's too dumb to even realize his inconsistency. Once the government stepped in to socialize a corporation's losses, that corporation lost the right to privatize its profits or even manage itself independently. From an economic perspective, the only thing more disastrous than a pure socialist system where both profits and losses are public is a fascist system where profits are private and losses are public.

Our children and grandchildren are going to take those losses, and they'll take far more in losses than Ken Lewis will.

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