March 31, 2009
Government Controlling YOUR Salary?
For those of you who cheered when Congress moved to enact a retroactive 90% tax on bonus recipients at AIG (despite the fact that Congress and the President both approved those bonuses in the "stimulus" bill), perhaps you'd like to cheer this as well:
But now, in a little-noticed move, the House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the "Pay for Performance Act of 2009," would impose government controls on the pay of all employees -- not just top executives -- of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place. And it would give Treasury Secretary Timothy Geithner extraordinary power to determine the pay of thousands of employees of American companies.
The purpose of the legislation is to "prohibit unreasonable and excessive compensation and compensation not based on performance standards," according to the bill's language. That includes regular pay, bonuses -- everything -- paid to employees of companies in whom the government has a capital stake, including those that have received funds through the Troubled Assets Relief Program, or TARP, as well as Fannie Mae and Freddie Mac.
The measure is not limited just to those firms that received the largest sums of money, or just to the top 25 or 50 executives of those companies. It applies to all employees of all companies involved, for as long as the government is invested. And it would not only apply going forward, but also retroactively to existing contracts and pay arrangements of institutions that have already received funds.
In addition, the bill gives Geithner the authority to decide what pay is "unreasonable" or "excessive." And it directs the Treasury Department to come up with a method to evaluate "the performance of the individual executive or employee to whom the payment relates."
The bill passed the Financial Services Committee last week, 38 to 22, on a nearly party-line vote. (All Democrats voted for it, and all Republicans, with the exception of Reps. Ed Royce of California and Walter Jones of North Carolina, voted against it.)
That's right: if you work for a company that received TARP funds, your salary could be regulated by the government. It doesn't matter if your the CEO, CIO, or the guy in the mailroom - Timothy "Tax Cheat" Geithner would have the authority to decide how much you should make. Nice, eh? Looks like the evil CEOs aren't the only ones on government's list.
Obama wants to nationalize the banks and it looks like he has plans for nationalizing the business sector - and it seems as though he has support amongst his minions in Congress. A man with absolutely no experience in the private sector, let alone running a car manufacturer, is now the de facto CEO of GM. What's next? Where will it end?
"Government big enough to supply everything you need is big enough to take everything you have ... The course of history shows that as a government grows, liberty decreases." - Thomas Jefferson.
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Posted by: maad at August 19, 2009 03:23 PM
