From the Wall Street Journal, two important and related stories.
First, Obama is fleeing from the tougher financial regulation and oversight on which he campaigned.
The Obama administration is backing away from seeking a major reduction in the number of agencies overseeing financial markets, people familiar with the matter say, suggesting that the current alphabet-soup of regulators will remain mostly intact. Administration officials had suggested they might push for major regulatory consolidation in the wake of the financial crisis. But now they expect to call for most existing agencies to have broader powers to limit risk-taking by financial institutions, say the people familiar with the planning.
And, banks are paying back their TAARP money. That's a good thing in the abstract, and even in some specific ways. They are doing so, however, among other reasons, to avoid regulations like executive pay caps, etc. It all makes sense from Obama's perspective: He threatened them, they're paying back their loans, indicating that they can stand on their own, but also allowing them to continue to set their own rules regarding compensation. Great way to stave off a crisis. Bad way to resolve, cure, or prevent one. Thoughts?
2 comments:
I find it bizarre that progressives seem to focus on executive pay.
1) In the context of the actual profits and losses of the companies in question, the amount that is being paid to these executives is trivial.
2) Given that the decisions of said executives can have tremendous impacts on said profits and losses (see: Jobs, Steve and Pandit, Vikram), it would strike me as quite justifiable, from the perspective of a board of directors, to spend a hefty sum in order to acquire the best talent available.
3) In the context of the bailouts these executive pay decisions are even more irrelevant. Even if for some reason you felt executive's salaries were unfairly extracted from shareholders, getting taxpayers off the hook for $25 billion seems like a win.
Is there something I'm missing?
4)
Insightful comments, Will. I suspect much of the obsession with executive pay on the left has to do with its symbolic, rather than material, significance. Obviously I and others might take issue with your characterization of executives as being worth what you say they are, but that's a different debate altogether.
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