If FedGovt can regulate bank exec pay, what in banking can't they regulate?

[Bunz]

Bailing out banks etc. has nothing to do with the authority granted in that part of the Constitution.

Can anyone here point out what part of the Constitution does give the Feds the authority to bail out banks and set the pay of senior executives?

It says pretty clearly in Article 1 Sec. 8 a little further down that it also will regulate bankruptcy which covers it further. But regulating commerce has quite a bit to do with preventing banks from going under.

 

[Bunz]

I think it is a tough sell to make the case that limiting private corporation pay falls into "regulating commerce between states."

The commerce clause can go quite a ways in its ability to regulate. And as someone else pointed out, Congress would be putting a requirement on the money they are being loaned. Much the same that happens with loans from both private and public sources.

Through my desk job, I have managed quite a few grants from a variety of federal agencies, I cannot just spend that money as I see fit, it must fit into a certain budget line already approved before the grant is awarded.

 

[Bunz]

It's an argument that's been literally laughed out of the Supreme Court.

But if you've done no homework, and know nothing about the long history of such big-government attempts, I guess you can make such arguments with a straight face, and with some hope that you can get someone to believe you.

Really? Care to point to a case? Because the commerce clause has been fairly strongly upheld throughout our history. I think that dealing with banks is an absolute no brainer when it comes to this section. Which is why you wont see this act taken to court as being unconstitutional.

 

[pocketfullofshells]

I think it is a tough sell to make the case that limiting private corporation pay falls into "regulating commerce between states."

private company taking public money...we have the right regulate money we give right? If they dont like it, dont take it. simple as that

 

[Andy]

private company taking public money...we have the right regulate money we give right? If they dont like it, dont take it. simple as that

Sounds like a slippery slop to socialism to me. I thought you were against bailouts for corporate types?

Here's what's going to, has happened, anyway...

1. they take the money
2. get a massive bonus for suckering the government into giving the money
3. they move on to another company with no gov' strings
4. and get paid tons because of their prior success. (namely getting the government to pay the last company cash)

Or, they take the money, and get other compensation, like rides on the corporate jet, company paid for vacations, company car, blaw blaw blaw...

In other words, they are going to get paid, whether it be in direct payments, or side benefits, or by moving to another company that will reward them for their past successes.

 

[Andy]

I love it! This sums up my opinion on the matter...

 

[chestnut]

Yeah, but Obama has plans to extend it to companies not taking bailouts. Read down in this article.

http://finance.yahoo.com/news/Obama-caps-executive-pay-tied-apf-14258147.html

 

[Mr. Shaman]

A long, long time ago in a galaxy far, far away, we had an idea that the Federal government's authority was limited to the powers given to it by the Constitution; and that all other powers were forbidden to the Fed.

That's long gone, of course, but this latest incursion makes me wonder.

President Obama has announced that senior execs in banks (those getting Federal bailout funds) will be forbidden by the Fed govt to make more than $500K/year. Has the US Govt ever imposed such wage caps on one single industry like this?

And, if they have the authority to do this under the Constitution, what's left that they don't have authority to regulate?

Ohhhhhhhhhhhhhhh.....so, this kind o' "welfare" is "different", huh (especially if the CEO is an old, White guy)?

​

 

[Greco]

The original post was intentionally misleading. The cap on compensentaion only applies to the financial institutions taking our tax money to save the corporations from the sorry mess their leadership created. It has nothing to do with banking regulations.

The poster probably knew this, he just wanted to throw out some whiney puss rant about Democrats.

 

[Little-Acorn]

The original post was intentionally misleading. The cap on compensentaion only applies to the financial institutions taking our tax money

From another recent article:

http://finance.yahoo.com/news/Obama-caps-executive-pay-tied-apf-14258147.html

Obama caps executive pay tied to bailout money

Ben Feller, Associated Press Writer
Wednesday February 4, 2009, 8:19 pm EST

WASHINGTON (AP) -- Assailing out-of-touch corporate pay and perks, President Barack Obama on Wednesday slammed a salary cap on top executives from companies that want bailouts

(snip)

Obama's new plan is broad.

Beyond imposing tighter rules on companies that get emergency bailouts, it also requires more openness and limits for healthy banks that tap into public money to expand lending. And it envisions broad reforms in how employees are paid at any public financial institution, even ones that don't get Federal help.

(snip)

The administration also will propose long-term compensation ideas even for companies that don't receive government assistance, Obama said. Among the ideas will be requiring top executives at financial institutions to hold stock for several years before they can cash out.

Right as usual, Greco.......

 

[Greco]

That's for clearly illustrating your lack of comprehension skills. It's makes it that much easier to consider your current and future whiney puss rants just more bufoonery.

 

[PLC1]

A long, long time ago in a galaxy far, far away, we had an idea that the Federal government's authority was limited to the powers given to it by the Constitution; and that all other powers were forbidden to the Fed.

That's long gone, of course, but this latest incursion makes me wonder.

Yes, that was indeed a long, long time ago. Now, there are two parties engaged in growing the federal government, one that admits it, and one that claims to be conservative.

The era of limited government has been over for some time now.

President Obama has announced that senior execs in banks (those getting Federal bailout funds) will be forbidden by the Fed govt to make more than $500K/year. Has the US Govt ever imposed such wage caps on one single industry like this?

And, if they have the authority to do this under the Constitution, what's left that they don't have authority to regulate?

Not much, but then, the choices are (1) let the banks fail, (2) let the banks fail while giving them a ton of taxpayer money, and (3) attempt to bring the banks back to financial health by giving them money, but regulating how they spend it.

No one in the government seems to be in favor of 1. The previous administration was in favor of 2. This one seems to be in favor of 3. Whether any of the three will actually work, or make things worse, is a matter of debate.

Is "limited government" dead?

Yes, absolutely. Has been dead and buried for decades now.

 

[Bunz]

From another recent article:


Right as usual, Greco.......

Yeah way to pick and choose the words you like to fit your agenda instead of taking the article as it is. But I am sure you will say something about the damn liberal media after I cherry pick the article and make some bold type of myself.
http://finance.yahoo.com/news/Obama-caps-executive-pay-tied-apf-14258147.html

WASHINGTON (AP) -- Assailing out-of-touch corporate pay and perks, President Barack Obama on Wednesday slammed a salary cap on top executives from companies that want bailouts -- but it's a limit that could end up thinning the wallets of only a small number of people.

Obama's action comes as many Americans, while hanging on for economic life, have watched Wall Street high-flyers receive big-dollar bonuses even as their firms draw public help for survival. The outcry has grown with each report of a bailed-out company that plans to buy a jet or hold a Las Vegas retreat.

The president aimed for a target -- extravagant corporate behavior on the public dime -- that fit the mood of the day. His $500,000 salary limit on executives from a limited number of companies was part of a broader assault on what he called a "reckless culture" that has helped wreck the economy.

"We don't disparage wealth. We don't begrudge anybody for achieving success. And we believe that success should be rewarded," Obama said. "But what gets people upset -- and rightfully so -- are executives being rewarded for failure, especially when those rewards are subsidized by U.S. taxpayers."
Yet in practical terms, the intervention into the corporate world is also limited.

The compensation cap covers distressed companies seeking special bailouts but would not apply retroactively to those that already have received them. What's more, consultants on executive pay say the cap will probably apply only to a few executives -- not big-time traders, brokers and salespeople who routinely earn whopping pay packages. And there are sure to be efforts to exploit loopholes as the new rules start to take hold.

Had the salary cap been in place when the $700 billion bailout program began, it probably would have applied only to executives at five companies that have received so-called exceptional help: Chrysler LLC, General Motors Corp., American International Group Inc., Bank of America Corp. and Citigroup Inc.

The half-million-dollar salary cap would apply to institutions that negotiate agreements with the Treasury Department for "exceptional assistance." That means those companies that get their own specialized help, beyond what is generally available through other financial shore-up programs.

Timothy J. Bartl, vice president and general counsel for the Center On Executive Compensation, said the president's actions involve a special situation given the government's role bailing out troubled institutions. "We do not view it as something that ought to be extended beyond this circumstance," he said.

Obama chose blunt language, chiding a "culture of narrow self-interest," golden parachute severance packages that "we've all read about with disgust," and the "reckless culture and quarter-by-quarter mentality" that he said has wreaked havoc. He has been particularly angered by a report last week that employees on Wall Street received more than $18 billion in bonuses last year while their eroding financial sector got a massive bailout from taxpayers.

The firms getting "exceptional assistance" from the government would face stronger rules on employing deceptive practices; stricter limits on golden parachutes; more disclosure on their salary plans and a requirement that their boards adopt policies on luxury spending items.

 

[Mr. Shaman]

"Any Bank bonus scheme that entitles any payment to anyone in the present cicumstances is a product of corruption and deceit in the boardroom.

As for losing talent if bonuses are not paid.....what talent???" - David McKeever, Northampton​

Tooooooooooooooooooooo-much common-sense.....​

 

[Andy]

Tooooooooooooooooooooo-much common-sense.....​

Um... it's their money. They can do with it, as they will. Further, not all banks are crashing. If a bank is doing well, why shouldn't they give a bonus to their CEO?