Be alarmed

Barny Frank, whoremaster of Georgetown, is pushing to ban all bonuses,any bonuses, being paid to any employee of a company that’s received TARP money. He also wants Congressional oversight over all salaries. Frank proposed this a year or so ago, pre-TARP and didn’t succeed. Now armed with a new rationale for the same fascist goal, he’s got a chance. I’d rather see my company collapse, throwing all my employees out of work and start again, rather than grovel before someone like Frank for permission to pay people what I thought they should be paid. I’ll be disappointed if a large number of corporate chiefs don’t agree.

26 Comments

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26 responses to “Be alarmed

  1. MSL

    In a just world Senator Rubble, Democrat-Bedrock, would be drug into the streets, tarred and feathered, then pelted with rotten fruit and vegetables. Unfortunately he would probably enjoy it. With the addition of a rubber glove applied to the head ala old school Howie Mandel and ball gag with leash, this is probably just the sort of fantasy chicken slave boy food fetish role play activity in which Senator Frank engages in his spare time with ambitious and sexually confused young male Senate pages.

  2. Arouet

    Hello. New to this blog. Love it. Question on the above post: if you believe that injecting govt funds will not happen without compensation controls, would you prefer that no govt funds get injected? Even if it risks complete bankruptcy? I have a tough time grappling with public sector funding, but no public sector say-so, even though I think the AIG bonus thing is being portrayed unfairly in the media. I’m a fiscally conservative tax lawyer from small-town KY, so I’m from a different world than people who take home this kind of money—-taxpayer funded or otherwise.

  3. Walt

    Chris –
    Sorry to beat a dead… I mean, sorry to belabor this point, but I really don’t think your fans understood what I thought of the Fed’s actions the other day.
    While I tried to make it simple and clear for you dummy’s, I still think there were a few who didn’t get my point. As I think this is very important to everyone, I would be remiss if I didn’t give it one more try. So over bloody’s this morning, I tried to think of a way to simplify how I see it, and I came up with this:
    Bernankes Printing Press

    Sorry I didn’t have my crayons. I am sure you guys would have liked that.
    Anyway, hope this helps you guys understand what is happening.
    Off to lunch!!!!
    Your Pal,
    Walt

  4. Jack Martin

    I personally do not care for Mr. Frank at all, but in this cases I think he is right.

    These companies have been run into the ground by their employees, nobody forced any of them.

    I am at a loss how these employees could be worth any more than any other low level employee that requires constant supervision.

    The new owners should have control over how their companies are being run and how their employees are being payed.

    As far as Mr. Frank running corporate America goes all I can say it is a frightening prospect.

    It looks like we are in a race to the bottom, with no end in sight.

  5. Hiram

    Walt, a guy who thinks nouns ending in “y” require an apostrophe (dummy’s, bloody’s) to make a plural, calls others dummies. The real Walt may be a crook, but I doubt he’s as illiterate as this blog’s pretend Walt.

    • christopherfountain

      I dunno, Hiram, the real Walt (are you sure this blog’s Walt isn’t?) did go to Harvard Law.

  6. Walt

    It’s a blog Hiram – Grammer Nazi’s are not allowed.
    of which you would seem to be.
    Fondly’s,
    Walt

    • christopherfountain

      Whoa there, boy – Hiram’s the only reason this blog even approaches literacy. I miss my copy editor, so don’t go after my volunteers (or, as you’d have it, volunteer’s!)
      I’m off to Round Hill, by the way – looking for bargains – is yours ready yet?

  7. Greenwich Gal

    Many of these companies were forced to take the TARP money and as in the case of BOA forced to buy a company they would not have wanted – i.e. Merrill Lynch. Do you really think any of these institutions would have taken this money had they known the rules would change mid game? I think NOT. I can see the Gov. not allowing the AIG bonuses – as it is 80% owned by them but to interfere this way is BEYOND stupid. Just watch all the talent fly out the door and work for the foreign banks – who have yet to do anything as stupid as this and there are hurting just as much. Call up that empty suit Jim Himes and give that communist a piece of your mind. This bill will only hurt our country – big time.

  8. Hiram

    Walt, it seems to me that being able to form plurals in your native language is pretty basic stuff, not something to be contemptuous of.

  9. Cos Cobber

    If this 90% tax really happens, look for many of these banks on TARP/government life support (some of which didn’t want TARP to begin with as Greenwich Gal stated) to suffer in the years ahead as the brain drain spigot opens wide. Who the F is going to stick around at a TARP institution for long. As soon as they can, they will be out the door. I know, you say they have nowhere to go. But the best will have someplace to go, leaving the idiots behind. And when the economy improves two iotas, then the flight out will really pick up. 250g is a lot of dough in Kansas, but its hardly rich by coastal standards. The 90% income tax will marshall a new crop of M&A firms and super banks faster than anyother peice of legislation.

    PS – its unamerican.

  10. DebtVulture

    The Gov’t screwed up. None of these institutions should have survived but since the Government gave them the money, the Government should live up to the contracts or. Changing contracts is a very dangerous thing. Who would want to deal with any company under Gov’t control if your contract can be changed on a dime. And since this is a RE blog, I’m sure you all know what this would do to Greenwich RE….it would take another steep leg down!

  11. FastFreddy

    Don’t get your knickers in a knot just yet. Use a little creative thinking. Nothing says banks can’t give people a performance-based pay raise in late December, then retract the pay raise in January due to “unexpected financial difficulties require that cash be conserved, blah, blah”. Then repeat the little trick in 2010 and subsequent years until the bonus rule has been repealed.

  12. Cos Cobber

    You could also contract out the services. Make all the high compensated employees independant contractors. Pay for their services as originally intended and add to it extra for company perks lost as a contractor (ie deferred comp plans, health care, self employment taxes).

    Sha-bam, the payroll criteria is met and the critical employee is made whole.

  13. Jack Martin

    Greenwich Gal you say, “Just watch all the talent fly out the door and work for the foreign banks – who have yet to do anything as stupid as this and there are hurting just as much.”

    Considering what a “good job” this “talent” has done maybe they should be offered a departure bonus if they go to work at some foreign bank or even a car wash in Brazil and promise to never return to America.

  14. SizeBuyer

    The best thing that could happen is that all of the brains get together and start several other firms leaving the current banks that received TARP funds with nothing but garbage and “do nothings”.

    Then congress can sit their scratching their heads when they realize that all of the money they put into these firms will never get paid back cause there is no one there!!!!!! Out to lunch, come back never…we (the ones you called stupid) all left and started other firms!

    Now that would be the best scenario and it would show the stupidity of congress in great detail.

  15. NY Trap Recipient

    Where does it end, the government of the United States is usurping the laws of our constitution.

    Have any of these dimwits thought about the unintended consequences of their decisions? Many foreign banks and for that matter multi national banks are not on bended knee before these urchins. Your taxpayer money will be lost if the talent leaves your JPM’s, BAC’s, GS’s etc etc. for the competition. Last i checked there are thousands of banks around the world

    Also has anyone thought about the people who are indirect recipients? A friend who is a massage therapist has seen her income drop by 30%. I am sure yesterday’s vote is sure to ecnourage people to spend money that will be taken away. Moreoever what if someone paid down their mortgage or reduced debt and they cant get it back?

    I could go on and on. Race to the bottom; where aleady there

  16. Hu Nhu ?

    This is a diversion from all of the solids about to hit the fan. Retention bonuses as standard for a distressed company in an orderly liquidation–like AIG–and a crisis manager is expected to pay up to keep the people needed to unwind matters in a way that minimizes capital destruction. Bankruptcy judges approve these all the time, and they don’t waste time estimating the virtue of the employees retained by these contracts.

    No surprise that our A.G., “put my picture in the paper” Blumenthal is glomming on to this farce. Perhaps he could focus on more authentic problems, for example, the FDIC insurance fund that is approaching ZERO.

  17. Greenwich Gal

    Jack Martin – It is obvious you know nothing about the workings of a large and complex banking institution. Many of the myriad departments of said banks no doubt have committed and successful departments which make profits for the banks. The toxic mortgage deals were probably run by a handful of people who are no doubt looking for work right now – or at least should be. The other people responsible would be those at the top who approved this high risk strategy – the top bean counters and their ilk who approve the levels of risk. The only way these banks are EVER going to be made whole again is to retain those people who are doing good business AND to be able to get new people in with fresh ideas and strategies to start anew. Strange thing is – you have to PAY for the top talent.

  18. Jack Martin

    Greenwich Gal you said, “Jack Martin – It is obvious you know nothing about the workings of a large and complex banking institution. ”

    I am far from an expert of how to run large and complex banking institution. I am also not an expert on how to run a country.

    But I do know when the French revolution cut out all of the top talent of France the French people were much better off.

    The overwhelming majority of people working on Wall Street most likely will not be buying in places like Greenwich for a very long time. The Wall Street money for nothing or very little days are over.

    The kind of money these people have been paid historically been for people with their own money invested and / or great new companies with great products that people use, not 3 card Monty games.

  19. Cos Cobber

    Jack, it be nice to believe that investment banks did nothing but run three card monty games, but that simply isn’t the case. A relatively small number of people, enabled by top brass, brought most of these institutions down.

  20. Anonymous

    Barney Frank is a bad man. He de-legitimizes government. He must go.

  21. Greenwich Gal

    Jack – I understand how you feel. The current situation is enraging. However, the governemnt coming in and trying to change to rules of taking TARP money mid game is ludicrous and only makes these companies distrust the government. It is rule by mob mentality and we don’t need that. Take for example a fellow at my husband’s firm – a private firm. However, his wife works at one of the TARP recipient banks. According to the “new rules” they are going to limit their bonus income as a FAMILY to $250,ooo. 250k may be a great deal of money in Arkansas but not here. If this passes, watch NYC fall even further. Remember those Dinkins years? You might be seeing that kind of stuff again.

  22. Net Worth Declining

    Many of the TARP recipients were forced to take the money. Then new after-the-fact laws are written that add new strings. And the government is making it difficult to pay it back. No different than seeking ‘protection’ from organized crime. You find out the ‘strings’ and the costs after the fact.

    The top producers will leave the banks that can’t pay bonuses. Many of them run succesful books of business they can take with them. Only junior people, hacks and government appointees will be left over time.

    Many banks will spin off or sell profitable divisions to preseve the ability to pay bonuses, thereby weakening the institutions we were trying to preserve and help.

    No-one will want to work with the Government going forward that has a clear record of changing the deal after the fact. Watch the private equity groups on Monday turn their back on the Treasury proposals to help clean up the toxic debt.

    We need to get this mob mentality under control. We all need to lead with some common sense. The record of really bad leaders coming to the fore throughout history to capitalize on mob anger in times like these is profound. And the results are never good. Short term or long term.

  23. Anonymous

    maybe the mob will turn on Congress. it’s still early.

  24. Greenwich Gal

    Well spoken, Net Worth. I am very concerned for our country. I hope we don’t end up like France.