Corker Claw Back Targets Wall Street Wallets for Failed Institutions
EmailRepublican Senator Bob Corker plans to one-up populist measures to reign-in Wall Street with a provision to punish top officials of failed financial institutions that require federal intervention by taking their personal wealth. Corker told me on “This Week” that he plans to introduce a “claw-back” provision which would take away the personal earnings for the past five years of the corporate officers of failed institutions that fall under the government’s resolution authority.
Corker said, “if a large entity like this has to go through this resolution where in essence they’re liquidated in an orderly way, I think that everything that the executive team and the board members have earned through this company over the last five years needs to be clawed back. In other words, there needs to be some penalties assessed to the management that have caused the country to have to go through this orderly liquidation process.”
White House Economic Adviser Austan Goolsbee wouldn’t endorse the idea, but said the president is supportive of measures that would cost officers of failed companies their jobs. “There is a requirement that they’re all fired. If you get to that point, all the management is fired,” Goolsbee said.
WATCH VIDEO HERE:
CORKER: There is no question, and I
think that first of all, I plan to offer changes to this resolution
authority that say that, if a large entity like this has to go through
this resolution where in essence they’re liquidated in an orderly way, I
think that everything that the executive team and the board members have
earned through this company over the last five years needs to be clawed
back. In other words, there needs to be some penalties assessed to the
management that have caused the country to have to go through this
orderly liquidation process. So absolutely, I will be offering an
amendment that deals with that, so that we’re taking back, we’re clawing
back all the earnings that management has made out of this firm, if it
has to go through orderly liquidation. I think that’s very appropriate,
and certainly I’m going to be doing that on the floor if it doesn’t make
it into the base bill.
TAPPER: Austan, can the White House get behind that clawback
provision? Are you being out-populisted by Republicans?
GOOLSBEE: Well, look, in the bill now — the president went to
Cooper Union this last week to revisit the spot where more than two
years ago, he went and said we need to have fundamental reform–
TAPPER: But there is no clawback in this bill?
GOOLSBEE: There is a requirement that they’re all fired. If you
get to that point, all the management is fired–
TAPPER: So they take their $500 million to their home in the Hamptons.
GOOLSBEE: — all the shareholders are wiped out. Well, look, as I
say, on any details, we’re open to looking at negotiating the details of
how we carry out the president’s principles. But if negotiation — and
Senator Corker, to his credit, is not in this camp — but if the
negotiators are going to come forward more as a delaying tactic and
we’re just going to put in hundreds of amendments and try to keep this
going so as to stall, delay and kill reform, that’s not going to
happen. This is going to pass.
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Why did you let corker off so easy? No questions on how he is protecting 400% interest rates from his cronies? Please hit harder on these guys when you get them in studio!!
NYT- WASHINGTON — Senator Bob Corker, the Tennessee Republican who is playing a crucial role in bipartisan negotiations over financial regulation, pressed to remove a provision from draft legislation that would have empowered federal authorities to crack down on payday lenders, people involved in the talks said. The industry is politically influential in his home state and a significant contributor to his campaigns, records show.
Posted by: mark | April 25, 2010, 11:22 am 11:22 am
I can see it now if a democrat proposed this.
Posted by: secondlook | April 25, 2010, 11:26 am 11:26 am
Yesss! Take their jets and their yachts and their limousine,
And put their heads in the guillotine
Posted by: lafarge | April 25, 2010, 11:39 am 11:39 am
Wow! I’m beginning to like this guy! Definitely Presidential Material. Go after those who sold and those who collected betting against the housing market. Leave them broke just like a lot of Americans!
Posted by: rightbehind | April 25, 2010, 11:48 am 11:48 am
At least part of the executive pay would not be “vested” for 5 years! It may work!
Posted by: tillyerkt | April 25, 2010, 11:51 am 11:51 am
The financial misrepresentation that led to the meltdown was Fraud. The profits from that fraud were illegal even if it was defined as income and sales commissions. But as a 40 year FORMER Republican, I doubt if the Republicans have the intelligence or guts to make this happen.
Posted by: JymAllyn | April 25, 2010, 12:01 pm 12:01 pm
Many of us who work for ourselves or who run small companies (including those running farms, commercial fishermen, etc.) live this way all the time. Our businesses don’t have the resources to pay us huge salaries regardless of our success. We work hard and, if we don’t make too many mistakes, the economy doesn’t crash, or nature takes a bad turn on us, we eventually get paid. But mistakes or bad fortune is costly. We can easily work very hard for very long, sometimes years, and get paid nothing. Worse than nothing, we have to cover the debt. If more people lived that way, they’d better understand what it takes to be productive. Sitting in an office (or cubicle) doesn’t mean one’s productive no matter how much “wall paper” they’ve collected from Colleges and Universities.
Posted by: Ron D- | April 25, 2010, 12:23 pm 12:23 pm
I’m with the Republicans here; stop fooling around and punish the people who steal from the American people not with retribution but by letting them pay back what they stole with interest, if they can afford it. What good is firing them without letting them give back the financial harm they caused. All business should be made responsible to society, it lives off of society. Maybe the Republicans are finally seeing the light? Wonder of wonders!
And Obama: Stop fooling around and put some teeth into what you say. You represent all the American people!
Posted by: JAM | April 25, 2010, 12:28 pm 12:28 pm
Punishing financially the managements AND the board members of the failed companies is an excellent idea. Everyone knows how much money those guys walked away with, even when the company failed or got bailed out. But as usual, Demos or Repbs have taking money from the industrial lobbyists and would try not to impose such a measure on the Wall Street anyway.
Posted by: cellisis | April 25, 2010, 1:01 pm 1:01 pm
Just don’t bail them out to start with! Idiots don’t see that when Taxpayers are forced to help failing companies, we all fail. It is a principle of the free enterprise system. Don’t screw with it, just stay out of the way.
Posted by: Stymee | April 25, 2010, 2:07 pm 2:07 pm
Don’t penalize the company, penalize the individuals involved. Ever heard of jail time?
Posted by: Keevion | April 25, 2010, 3:09 pm 3:09 pm
secondlook- LOL. Yes, I could imagine the Republican rancor if a Democrat suggested this.
Posted by: James @ 39 | April 25, 2010, 3:47 pm 3:47 pm
As any small business owner knows, if the business is losing money, there are no bonus’s, there are no giagantic salaries. Evryone does what they can to help keep the company solvent.
The idea that thise banks took huge salaries as the banks were going bankrupt is ridiculous. And in fact kept on the same people who were resonsible for the melt down. If dems and repulicans can’t see how they raided the coffers and then threatened the US with financial choas if they didn’t get taxpayer money then we are beyond redemption.
These banks should have just failed, thats what happens in business, they should be held responsible for the damage they caused and if it means they lose the millions they made, then so be it. otherwise what incentive do they have to stop these practices. Be nice if you and I ran our business in the gound by being reckless while raiding the bank account for every last dollar and then went to uncle sam and said……please sir, may we have your money too!!!
Posted by: Edward80 | April 25, 2010, 6:55 pm 6:55 pm
Maybe the Republicans are finally seeing the light? Wonder of wonders! Posted by: JAM | Apr 25, 2010 12:28:05 PM **************************************
Just remember, they are all lawyers in sheep skins
Posted by: spacerook1 | April 25, 2010, 7:18 pm 7:18 pm
Will Obama ruturn the nearly 1 million dollars he got from Goldman Sachs?
Posted by: bo | April 25, 2010, 7:26 pm 7:26 pm
The real problem here is not enacting new laws to prevent this from happening again…………….it’s about enforcing the laws we already have. The SEC, had it been doing the job it gets paid to do should have spotted this kind of thing. Of course the goverment doesn’t seem to want to make the people who get paid for their job DO their job. Lets just add another 50,000 more employees to oversee the current employees that don’t do anything for their paycheck. This is getting so ridiculous. I would just love to hear a goverment official admit that the laws we already have would work if the people hired to enforce them did their job! Too easy!!
Posted by: Edward80 | April 25, 2010, 8:19 pm 8:19 pm
That really was a good little debate… I think Senator Brown is tops and wish he was a Senator here in KY<
At least Senator Corker is talking which is better than just saying "no" but, then again, Republicans in bed with Wall street have a more vested interest in what takes place in financial reform… Unlike the health care reform…
Posted by: theafalcon200 | April 26, 2010, 7:19 am 7:19 am
Until congress cuts their crazy spending and earmarks and lobbyist favors nothing is going to get done. The only thing lthis congress wants is to line their own pockets.
Posted by: mj | April 26, 2010, 8:08 am 8:08 am
rein in
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