Obama’s Pay Czar: Taxpayers Must Get Their Money Back
EmailKenneth Feinberg, the man appointed by President Obama to slash the salaries of top executives at seven companies that received TARP bailout money, sat down for an interview with ABC’s Betsy Stark today. We've posted the video and transcript below. Take a look and tell us, what do you think of this plan to cut executive pay?
STARK: Mr. Feinberg, how worried are you that weak companies could get even weaker if the best and the brightest see these restrictions and then go leave in search of a bigger paycheck?
FEINBERG: Under the statute it’s a big concern. My primary obligation here is to make sure under the law that the taxpayers get their money back that was lent to these companies. And I had to take into account, making sure as best I can, that these companies thrive so that the taxpayers get their funds back.
STARK: But if a year from now or less there is in fact an exodus of top talent, will you reconsider these restrictions, or are they final?
FEINBERG: Every year we take another look, at compensation now for 2009, then 2010, we will revisit exactly the progress of these companies in terms of repaying the taxpayer, and we’ll take another look at that time.
STARK: How effective can this really be in reducing excessive risk taking if it only applies to these seven companies, and all other companies are free to do what they want?
FEINBERG: Well that’s an interesting question. I’m hoping that using these seven companies as a template or as a model that other companies will voluntarily see the wisdom of the way we’ve structured compensation. Less cash, more long term stock tied to the financial future of these seven companies. Hopefully others will see the wisdom of this and follow suit voluntarily.
STARK: But if they don’t volunteer should restrictions be imposed on companies?
FEINBERG: No, I think the secretaries made clear, the administration has made clear, the law makes clear – this is unique situation involving these seven companies who are in effect owned by the taxpayer. I do not think it wise nor prudent to expand the jurisdiction of what I’m doing now, no.
STARK: How satisfied are you now that you’ve done right by angry taxpayers and you’ve done right by companies worried about their ability to compete?
FEINBERG: I think I’ve done the best I can. I must say I am very sympathetic to the arguments on both sides. I’ve tried to balance both sides listening carefully to what is said in the way of citizen anger and also the statute which requires that these companies stay in business and thrive so we get repayment.
RSS
Twitter
Facebook
What about a company like Hewlett Packard? The top CEO’s made millions, and now they have cut salary’s of workers up to 30%? Why should this be allowed. They are stock pilling money and collecting bonuses while the real workers of the company are cut down to wages they made 10 years ago.
Posted by: Kay Speed | October 22, 2009, 4:26 pm 4:26 pm
“this is unique situation involving these seven companies who are in effect owned by the taxpayer. I do not think it wise nor prudent to expand the jurisdiction of what I’m doing now, no.”
A key bit of reality to keep in mind. If you don’t want The Government telling you how many million to pay your CEO, don’t demand billions of dollars from the taxpayer to avoid bankruptcy and massive job losses. These companies got the carrot, this is a (very light actually) stick to keep them focused on paying us back.
Posted by: jhw539 | October 22, 2009, 4:41 pm 4:41 pm
Feinberg is on the right track. It would be great if this could be retro-
active.
What “best and brightest” are they talking about?
The so-called “best and brightest” took the money and are back for more.
There are a lot of people who could rebuild those companies. I can see no problems replacing them if they leave. In fact, they should leave.
p.s. Hewlett Packard should be ashame of themselves for short-changing the workers and giving their CEO’s millions.
In fact, I hope some watchdog group out there can expose Hewlett Packard for this deed.
ABC, are you up for this task?
Posted by: ddg | October 22, 2009, 4:44 pm 4:44 pm
Re: The new Franken law regarding companies who make their employees sign a waiver if they are raped (it has to go into arbitration; not the legal court system)
I never knew something like this existed. How shameful is that?
I’m sorry to say that republicans voted AGAINST the new Franken law.
I’m very disappointed. Of course, these numbskulls only want to be oppositional. I find that very shameful.
A big raspberry to these republicans!
(I’m a republican, for the most part.)
I would have voted for the Franken law if I had an opportunity.
So the score is: Feinberg and Franken get an A+.
The obstinate and shameful republicans who voted against Franken: a big fat Zero.
Posted by: ddg | October 22, 2009, 4:57 pm 4:57 pm
I forgot about John Kerry. He gets an A+, too.
The republican party better wake up, because I believe I am a middle of the road republican. If I’m disgusted, then a lot of other middle of the road republicans might turn on them if they don’t shape up.
Posted by: ddg | October 22, 2009, 5:01 pm 5:01 pm
“I’m sorry to say that republicans voted AGAINST the new Franken law.
I’m very disappointed. Of course, these numbskulls only want to be oppositional. I find that very shameful.”
ddg | Oct 22, 2009 4:57:02 PM
Not all of them. 10 Republicans supported the measure, including the 4 women Republican Senators (who joined the 13 women Democrats on this issue). These Republicans should be respected for bucking the party line and voting their conscience.
Posted by: jhw539 | October 22, 2009, 5:10 pm 5:10 pm
Does Feinberg’s momma know he’s lying when he says:
“And I had to take into account, making sure as best I can, that these companies thrive so that the taxpayers get their funds back.”
I mean, come on. Does Feinberg really expect anyone to believe he’s doing all this to return tax dollars to taxpayers?
I’ll believe it when the check arrives in the mail. On the same day that pigs take flight and Obama admits he has any personal responsibilty for anything.
The “Crooks-Gone-Wild” gang is killing America faster than you can say, “hey, what do’ya think you’re doing?”
Kick the donkeys and elephants out of office, and elect a bunch of cats and dogs in their place — real cats and real dogs. They’d be a lot cheaper to feed, and not near as messy.
Posted by: TParty4USA | October 22, 2009, 5:23 pm 5:23 pm
Why stop here? The wages we are paying the Obama administration is out of line as well. The taxpayer is bailing their policies out every time they “deficit spend” Who’s the czar watching them?
Posted by: D | October 22, 2009, 5:54 pm 5:54 pm
Bravo, Feinstein. Bravo, Obama.
We’re a Christian nation, aren’t we? So what would Jesus do?
Jesus told the rich man, AKA CEO, AKA billionaire to “sell all you have and give to the poor.”
We are finally beginning to act like a Christian nation. Can I hear an a-men?
Posted by: William Joseph Miller | October 22, 2009, 6:31 pm 6:31 pm
I am calling BS..me and my co-workers had my pay cut while my COE took millions in bonus. We were told if we did not like it we could find another job. Let these COEs go and apply for a job with everyone knowing they ran a company into a ground or do they even look at resumes these days in the good o’ boys club.
Posted by: James K | October 22, 2009, 6:43 pm 6:43 pm
Why are should we be concerned that these executives will leave the company???? Aren’t these the same executives that go the companies into the mess that required the bailouts? Who wants to keep the ‘brightest’ if they run the company into a bailout situation?
Posted by: Loretta Mapes | October 22, 2009, 6:47 pm 6:47 pm
who’s next to get regulated? Let’s start with Hollywood and then maybe professional athletes and see how that goes over.
Posted by: Snoski20 | October 22, 2009, 6:53 pm 6:53 pm
Talent? What talent? From what I’ve seen a chimp in a nice suit could screw the American economy up just as well.
For the CEO pulling down millions doing so may seem the way to go. For the CEO pulling down millions while he lets his corporation go down the drain is just pure stupidity.
Every million dollars of compensation a CEO makes takes away 63,000 minimum wage jobs.
There used to be a time when CEO’s were the first to take a pay cut when their business was in trouble. Pay was tied to performance and every businessperson knew keeping people at work meant keeping America going strong.
Posted by: Michael Strickland | October 22, 2009, 7:01 pm 7:01 pm
one thing that seemed to get lost in the article was that the people affected by the pay caps are the people that mismanaged their companies into needing the bailout. corporate salaries have become excessive. what person is worth more than one million dollars per year to run any company? even our politicians don’t earn that kind of salary and they are responsible for the whole country.
Posted by: tom | October 22, 2009, 7:01 pm 7:01 pm
The mandatory 50% reduction in senior executive pay at those companies that took significant tax-payer bailout money is long past due.
Opposition arguments that the companies should be allowed to pay what they want based on performance in order to retain the best workers doesn’t hold water. The disaster happened on their watch. Their greed and focus on short-term gain heedless of risk instead of the long-term profit of their companies caused the melt-down. Without tax-payer bailout money, the companies would have failed and these executives would be out of a job and not have any income. If these executives were payed based on their performance, the companies would fire them. If these are the best executives these companies can find, they and we are in real trouble.
Posted by: Michael Burmeister | October 22, 2009, 7:02 pm 7:02 pm
Although we are a Christian nation we still got to where we are due to allowing people to make money. These CEO’s spent a lot of time and money to get to where they are now. If you do not like where you are now get off the couch and go spend the time and money they did and re educate yourself so you can be in a position to make more money. The United States has always been the land of opportunity not entitlement.
Posted by: Snoski20 | October 22, 2009, 7:05 pm 7:05 pm
If these guys are the best and the brightest, why do they need my money to bail them out? They should have been bright and smart enough not to get to this place. Sorry, When Taxpayer money is used, Taxpayers get to make the rules!
As for Hollywood, that is not taxpayer money, outlandish though it is. Some sports figures get piles of dough after getting government considerations for new stadiums, etc., and there might be a case there for restrictions. Why should I eat dogfood so these dudes can say they make 8 figures?
Posted by: chidem | October 22, 2009, 7:05 pm 7:05 pm
I’m outraged. Why would a business actually “want” to keep executives that have “bonused” the company into the ground. No bonus should be paid to any employee if the company is not profitable. Where did these pin heads learn business accounting???
Posted by: Marsha Perkins | October 22, 2009, 7:09 pm 7:09 pm
I have seldom heard such specious arguments as those now coming from Wall Street on the CEO pay issue. These are the free market geniuses who got us into the credit collapse mess. Please spare us their whinging, self-serving BS about brain drain. There are thousands of talented managers in this country who could and will step into the top spots if opportunity arises. And perhaps they would provide some true leadership for a change, rather than the rapacious, self-serving behavior we see so often. So folks, be our guests but don’t let the gilded doors of your overdecorated offices hit you in the butts on your way out, OK?
Posted by: Henry McCown | October 22, 2009, 7:09 pm 7:09 pm
A proposed bill is being talked about today that would allow the government to regulate all companys not just the ones the government bailed out. I agree that tax payer owned companies should be regulated but other companies that have not taken bail outs should be left alone.
Posted by: snoski20 | October 22, 2009, 7:10 pm 7:10 pm
I live on SSI disability of under $700 a month. The bank where my account is at reciently introduced a savings program that was attached to my account & sounded like a good idea, so I signed up. What they didn’t say in a way I noticed was that they were charging $6 a month maintainance fee on that savings. How would anyone in my position feel about their pay?
Posted by: Phyllis Delisi | October 22, 2009, 7:14 pm 7:14 pm
P.S. the government is not telling all the companies what to give as bonus perks…only the ones who borrowed money from us..the taxpayers. We are not getting any raises or bonus’ on our jobs so why should they? This baloney about not being able to attract good people if laughable. If they were so good …..why did the company need a bailout? What I don’t understand is when the government did nothing..people complained…now they are acting,people are still complaining…you can’t have it both ways. What they are doing is right and fair. First pay what you owe and then get a bonus with what is left…not get the bonus first and then pay back some.No that is not how it works.If you owed money to the bank and did not pay it back but took vacations and bought cars, rings, etc…the banks would forclose on your house and rightfully so. Banks…this is your forclosure. Pay up.
Posted by: talmag | October 22, 2009, 7:23 pm 7:23 pm
I hear that GM is having a hard time finding a CEO who’ll work for the measly $1 million dollars that they are offering.
I guess I could sacrifice my $65,000 annual salary to take over that job. Especially since I’m currently one of those in the unemployment line.
Posted by: Rob | October 22, 2009, 10:11 pm 10:11 pm
Fox reported ABC, CBS, CNN and NBC objected to the White House determination for the 5-member media pool to interview Mr. Feinberg, minus Fox News.
One who fights for another’s freedom protects his own. How sad the battle for freedom was with our own government.
Posted by: Melissa | October 22, 2009, 10:45 pm 10:45 pm
Overpaid executives got big bonuses for allowing the companies to fail. The President and his Congress send the country into record debt but they get a raise. Workers who did their jobs got laid off. Even Social Security income is frozen.
The rich got richer, the poor got poorer, the middle class moved down a notch or moved into the ranks of the poor. Cost of education just went up to keep the children of the proletariat down where they belong.
The “stand up for the working man” Democratic party my grandfather knew is gone. It has been replaced by a party which works for the elite super-rich. Pull the wool off of your eyes and look around.
Posted by: oonogil | October 22, 2009, 11:54 pm 11:54 pm
Where else these “genuis” go for a bigger pay check? Another bank? What’s worries with that?
Posted by: leighg1 | October 23, 2009, 1:04 am 1:04 am
Hooray for Ken Feinberg; I read his book What is a Life Worth? He is marvelously fair and intelligent. Who cares whether so-called “talent” leaves. Anyone can do better than what they did.
Posted by: Sandra | October 23, 2009, 2:06 am 2:06 am
Why arent we capping congress spending. Lets see the stimulus plan has been a complete failure. The WH financial advisor has said the biggest gains were in 3rd and 4th quarters and that we should not see anymore gains from it in 2010. The final results 49 of the 50 states have seen a decrease in jobs. Now we have a 1.4 trillion dollar debt and with the current spending we are at a unsustainable pace. This means we will be broke. With the great success of this plan we are now trusting these people to overhaul our health care at a cost of over a trillion dollars? Where is there fiscal responsibility? Too many entitlements and corruption are bankrupting this country and I see alot of people here still wanting to spend more.
Posted by: randy | October 23, 2009, 6:24 am 6:24 am
Perhaps these companies who got in trouble with the high-paid geniuses running them will do better with execs who make less and can concentrate on getting the job done for the good of the customer (and society) instead of themselves. I know that runs counter to free market capitalism, but in many ways is the mindset that built this great country of ours.
Posted by: Art Maurer | October 23, 2009, 7:21 am 7:21 am
No one is talking about regulating the pay for company execs of companies that did not get a ton of TARP money. The argument that by regulating these 7 companies, it would “open the floodgates” for regulation of other companies, is pure BS. The “floodgates of Hell” argument is the last refuge of the ignorant and intellectually lazy.
Posted by: Jane | October 23, 2009, 7:42 am 7:42 am
Fat chance of that.
Posted by: Rick McDaniel | October 23, 2009, 9:10 am 9:10 am
“Where else these “genuis” go for a bigger pay check? Another bank?” – leighg1
Good point leighg1, but you got me thinking.
Maybe we should pay these “talented” folks closer to what they want to keep them at the failed/failing institutions. Otherwise they may go and work somewhere else and help bring down another bank or two.
Better yet, congress can come up with a bill to pay them for doing nothing, sort of like paying farmers not to grow food. That way those “talented” workers would do no more damage to the economy.
I’m sure this makes sense to the people on Capitol Hill.
Posted by: Noz | October 23, 2009, 1:22 pm 1:22 pm
The problem is that these guys/ladies aren’t going to stay at a company and take the pay cut. They’ll move, and it will be difficult to replace them with people of the same quality for lower pay. These folks don’t just sit around golfing and eating expensive steaks poo-pooing the common man. They work 18 hour days/7 days a week, and sacrifice their lives for the companies. I don’t know about you, but I’m not doing that. In addition to the sacrifice they also spent money/time on advanced degrees. When you do this, you get more money. Anyone who is angry these people make great money is just jealous because they want the money too, but don’t want to put in the time and effort. And when these people leave and can’t be replaced except by lower quality, it will take that much longer for us to get our TARP cash back. But wait, maybe that’s what Obama wants? To stay in control of these entities that much longer? Naaaahhhhhhh……that ain’t it at all…
Posted by: boomer | October 23, 2009, 3:42 pm 3:42 pm
No one should be talking about the govt regulating ANYONE’S pay because they gave a loan.
My do you see how stupid this is.
This is not justice is VENGEANCE. This is not how Americas do things its class warfare garbage.
If they committed a crime then they get TRIED and punished. So they do a dumb act and give out bonuses and the govt cuts them and cuts their salary? Ohhh good they got what they deserved right? Oh they DESERVED IT RIGHT? What are they guilty of exactly? Who cares right. Who cares just that they had the NERVE to over spend on themselves.
We care if the terrorists in CUBA get a fair trial but these turds can get their pay cut and bonus taken away become some politician thinks so. OH joy that would have got the unions soooooooo ticked off if that happened to them but its OK if its THEM?
Listen to you guys. This is not justice its PAY BACK. I have an idea who made a TON of money on the tax payers too but the congress would NEVER investigate themselves its just to ‘embarrassing’ isn’t it.
They become millionaires on govt pay right? Oh sure.
Throw them in JAIL if they are such ‘criminals’ but not this ‘robin hood’ justice. It is a line we should NOT cross. Oh I make very little money can I say who makes to much money and gets paid by tax payers. I don’t think congress would like that esp when THEIR approval rating is less than 30 percent.
Posted by: David from WI | October 24, 2009, 2:35 am 2:35 am
DID THE PRESIDENT GIVE THE ORDER TO DO THIS OR WAS IT THE PAY CZAR THAT MADE THE CALL? DID THE PRESIDENT HAVE TO SIGN SOMETHING TO MAKE IT HAPPEN, OR DID THE PAY CZAR DO IT ON HIS OWN WORD?
Posted by: frankie | October 24, 2009, 12:53 pm 12:53 pm
The best and the brightest got us into this mess with their lending practices. If anyone wanted to offer me a compensation package that included stock options and $1M a year – I would jump at it. I wonder how many homeowners could be spared the humility of foreclosure by cutting just one of the best and brightest salaries in half? I think $25M could go a long way to save people – regular folk – and keep them in their homes!
Posted by: Susan Szewczyk | October 27, 2009, 2:43 pm 2:43 pm