The Irony of Senator Schumer on Executive Pay
Bank Program Reignites Debate on Executive Pay
By Peter Whoriskey Washington Post Staff Writer Tuesday, October 14, 2008; A07
The decision to devote some of the $700 billion financial rescue for direct cash infusions into banks has reopened the rift over whether financial institutions that get federal help should abide by executive pay limits.
Treasury officials have argued privately that banks aided this way should be exempt from the toughest executive pay restrictions in the rescue legislation passed by Congress.
Some lawmakers disagree.
"Restrictions on executive compensation will ensure that taxpayer money is not wasted enriching the same people whose poor decision-making created this crisis," Sen. Charles E. Schumer (D-N.Y.) wrote to Treasury Secretary Henry M. Paulson Jr. yesterday. "It is imperative that these restrictions, including limitations on the incentives for executives to take excessive risks and the elimination of golden parachutes, should apply to any capital injection program."
Exempting the banks in the program is "not in the spirit of the thing," said Rep. Spencer Bachus, (R-Ala.), ranking member of the Financial Services Committee.
I just love it when these paid-off Senators get their backs up about the morals of executive pay and whether or not such subjects are in the spirit of the thing.
The spirit of the thing, when weighed against executive pay on the scale of who, what, when and how Schumer and the boys sold their constituents down the river--happens to be paramount. The spirit of the thing is tens of millions shoved into the eager pockets of Schumer, Bachus, your Senator and mine. The spirit of the thing will continue to protect those with plenty of dough to set the spirit of the thing rolling again and hand you and me the bill (again).
There will be a lot of settling to be done as we meander our way out of the sinister forests of mismanagement and greed. Some of it will have to do with indictments, some with moral hazard and finally, when all the dust settles, a long conversation with the Congress on the spirit of the thing. We were not meant to have a legislature that operated on payola. There was a time--and that time was not all that long ago--when a congressman or Senator was thrown out of the organization for taking a bribe.
The Congress, in their ultimate wisdom, has now made the bribery of their offices a mainstay of re-election campaign funds. It's no more realistic to expect Chuck Schumer to get off mainlining lobbyist money than it is to expect Wall Street to take a voluntary pay cut. This current meltdown, if it is to have any lasting benefit at all, may change the scenery on both stages.
We now have over 17,000 lobbyists in Washington, throwing $1.59 billion annually at our elected officials and agencies. To give just an idea of the wizardry involved, Schumer raised $12,928,238 from lobbyists in the past five years, spent $16,193,913 and has $10,309,578 currently left over in his war chest.
How does he do that? Give us the secret, Chuck. Maybe we can bailout the economy with the same strange numbers.
So, I guess we're stuck with enriching the same people whose poor decision-making created this crisis--Chuck Schumer, Spencer Bachus and their band of merry knaves.