Don't know where to start…

It could be, Dr. T, that when the states seceded they became foreign powers and when Fort Summer was attacked then the U.S.A. went into defensive war mode to repel the C.S.A. attackers?

"Good Lord." - K Ackermann

But still no reply to, "Where's the gutting, Ackerman? Point to it. It's your claim. You wouldn't say something without knowing what you're talking about, would you? It's such a simple request to provide evidence for your statement."

Yasafi often ducks the tough questions, too. You're in good company. LOL

Good Lord.

"Is that not a substantial bonus?

No. Remember my pay was cut in half. In exchange for cutting my pay in half while developing something they could reject, I loaded the back end. Like I said, I walked the walk for them."

Ackerman, you are hilarious. This sounds like every compensation structure on Wall Street (save secretaries and first-years) except you get all of your comp in cash and they get a huge portion of theirs deferred. You walked the walk and kudos to you! But you no more walked the walk than anyone you're pounding in this thread.

Vidyohs,

My patience has gone the way of liberty in this country. Can you blame me?

"I'm going to ignore all the petty personal attacks, and if you want to continue believing that regulations were not gutted, then that's fine."

By "petty personal attack" you mean calling you out for your vast ignorance.

Where's the gutting, Ackerman? Point to it. It's your claim. You wouldn't say something without knowing what you're talking about, would you? It's such a simple request to provide evidence for your statement.

The rest of your post is just more scapegoating drivel. Until this part:

"You can gripe all you want, but just remember who screwed everything up."

I do. That's why I'm not running toward government to make the boo-boos go away. They created the mess by forcing banks to lend to uncreditworthy individuals, by cutting the interest rate too low and by creating other perverse incentives. There were imprudent decisions outside of government incentives, but it was government that decided to rob you to pay them. Obama doesn't want to control the pay of the officers of the company. He wants to control the compensation of the rank and file as well.

I have a feeling that by the time your tantrum finally ends and you realize the implications of this move for the rest of us, it'll be too late.

"...the land of the free, and the home of the brave"

Time to change our national anthem.

"...a nation of sheep, and government of wolves."

A comment above discussed 80 years of ignoring the Constitution. Its actually been two centuries: federalism started dying in the early 1800s and was killed by Lincoln. (Try to find the section of the Constitution granting the federal government the power to declare war on states that want to leave the union.) The only difference between the Obama presidency and others is that Obama is pushing for many unconstitutional changes at a rapid pace. He wants to shred the Constitution faster than FDR did.

Is that not a substantial bonus?

No. Remember my pay was cut in half. In exchange for cutting my pay in half while developing something they could reject, I loaded the back end. Like I said, I walked the walk for them.

I'm going to ignore all the petty personal attacks, and if you want to continue believing that regulations were not gutted, then that's fine.

Let me just point out that we (America) promised the world that capitalism would lift people and nations out of poverty. We also told Iraq that we were going to invade them for their own good.

Capitalism and democracy are now things that parents threaten naughty children with in other parts of the world. Vladmir Putin pretty much owned Bush when Bush started lecturing him on democracy.

Even as the banks were losing money, the executives were etting bonuses. Their behavior not only made them go begging hat in hand for our money and damaged shareholders everywhere, but their actions and their behavior have caused a giant loss of credability and trustworthiness throughtout the world. No institution has set back capitalism more than the banks have.

That's what your precious banks have done. They have set back the free market. If it was greed, then string them up. If it was just a series of honest mistakes, then cover them under crushing regulations if that's what it takes to prevent them from levering up 30 and 40 times in the teeth of a bubble.

Our economy is going to limp along at best for years and years, and you want to coddle these people? What kind of talent does it take to lose gobs of money? The more I think about it, the more I like the idea of populist revenge on the banks. Limit their pay to the average executive compensation among all the rest of the developed nations. Where are they going to go?

They forced things on me that I didn't like, I think a little sweet revenge is in order. I would love to see them have to scrape by on a million or two a year. Steve Balmer only got paid a million or so last year, and Microsoft's market cap is $175b.

These fascist controls, as you call them, are probably very familiar to you. You can warn about executive pay now, along with taking your guns away, forcing you into a gay marriage with an illigal immigrant, secretly infecting you with aids, and mind control. The next thing you know, Obama will be opening an abortion clinic in St. Patrick's Cathederal, and forcing people to donate organs to the poor.

You can gripe all you want, but just remember who screwed everything up.

Tell us how you really feel, methinks. :-)

Who do you think gutted the regulations?

The gutting of which regulation precipitated this?

Convenient of you to leave out the fact that government was sitting in your lap pressing the accelerator and forcing the wheel when you ran over the kid. Or maybe (likely) you just don't know what you're talking about.

Of course bonuses are paid in cash!

You know this because.....????

I actually worked at these banks and have been paid bonuses in the past. Have you? You don't even know the difference between Enron and investment banks. You have no idea what's going on, yet you're prescribing solutions.

We all want more, but some of us are willing to work harder for it.

Right. Because only you want to work hard and be paid for your work and only you know the difference between real work and what trickery. Very clever of you.

Yes, taxes suck if you are rich, but they suck less than being poor,

Do you think before you write? Taxes are a way to impoverish you by confiscating the product of your labour. You are materially poorer and you're poorer because you've worked instead of spending time on other activities. The poor schmuck who is waiting for you to create a job for him by coming up with something and then building a company around it won't get one but taxes reduce the pay-off for starting a company but do nothing to dampen the risk, so you won't start it. Think about it long and hard. It's math. You're an engineer. I have high hopes for you. Don't dash them.

A stable government is one that offers the most freedom and happiness, while making sure people don't fall through the cracks.

Uh-huh. In the Soviet Union we had a very stable government. So what? "Falling through the cracks" is sort of subjective and NONE of that has ANYTHING at all to do with the subject of this thread. You're off on an emotional and solidly ignorant tangent.

Incidentally, my grandfather was the head engineer in some government engineering firm in Russia. He lived in a tiny one-room communal apartment with his wife and daughter with no bathing facilities - only a shared toilet and shared kitchen sink. He was forced to share the apartment with an unmedicated (what with rationing in free healthcare and all) schizophrenic who eventually went nuts and tried to stab his daughter. The government told you where you could and could not live, how much you could make and what you could and could not say and think. It was exceedingly stable. These fascist controls are merely the beginning of this kind of life here and useful idiots like you are usually the first to be executed.

So, I won't be holding my breath for you to come up with a list of those non-existent "gutted" regulation. Hey, didn't engineers build that bridge in minnesota that went down? Didn't they also design the World Trade Center? When can we have a public lynching of Engineers. By your logic, we should support that.

You are ridiculous.

K Ackerman.

"If the service was viable at the end of that period, there was to be an additional year at 1.5 times the rate."

Is that not a substantial bonus?

Methinks, you see the government as a distinct entity out to destroy the country.

To say the banks worked within the regulatory system is like saying that you didn't run over the children, the car did. Who do you think gutted the regulations? Do you think the government just decided one day that it wanted to gut all the restrictions that were in place to help prevent the type of meltdown we see?

Of course bonuses are paid in cash! Incentives in the form of options are just one type of compensation, but actual bonuses paid in cash are hugely popular in the banking industry. Look at the fiasco at Enron; they literally drove that company into the ground. It became a game of how to screw their customers in greater ways to try to make up for cooking the books, even while drawing down billions in bonuses. Do you think, maybe the bonuses are what led to their immoral, criminal, despicable behavior?

I'm just curious - in what way has our evil government held you back? Were you right on the threshold of something great and then the government did something to you that prevented it? Have you already become wealthy under our system but want more?

We all want more, but some of us are willing to work harder for it. If you beef is really about ideology, then I have some hard advice - ideology is blinding.

Yes, taxes suck if you are rich, but they suck less than being poor, which is what would happen without a stable government. A stable government is one that offers the most freedom and happiness, while making sure people don't fall through the cracks.

Quit whining like a victim, and make lemonade.

Ackerman,

Do you think?

You have no clue how bankers are paid. You obviously have no idea that bonuses are not paid in cash but mostly in deferred compensation which is mostly invested in the company's stock and vests over a period of years. Thus, if the bank goes down, the unvested portion of the bonus disappears and that serves as a natural clawback of previous bonuses. Neither you nor Obama nor Dim Teithner have any clue how long the vesting period needs to be.

You obviously don't read too carefully. The Obamessiah is seeking to control the wages of everyone working at the bank - including the workers who have absolutely no control at all over the businesses the bank wishes to enter or how the bank wishes to behave in those businesses. Plus, he's seeking to control the compensation of ALL financial firms and I have news for you - not all of us are entangled in the mortgage market.

Since the board no longer performs the roll it should in these companies, then someone should lookout for the shareholders.

Ah, yes, the poor, dumb, mouth-breathing, knuckle-dragging shareholders need you and Obama to save them from themselves. Obviously, they're too stupid to voice their opinions, vote for board members, sell the stock or sue the company on their own. They already have outside help in the form of activist hedge funds who actually put their money where their activism is and force changes at companies when boards won't. There's a whole body of law that governs the actions of the company with respect to shareholders. The only thing you and your Messiah are going to do by capping pay is prevent those shareholders from attracting the most qualified people to run their company for them. Congratulations.

I can't believe you all are sticking up for bankers who destroyed half the world's wealth.

Cap their pay? We should be capping their knees

Please, whatever you do, don't allow your extreme ignorance to stop you from making such well thought out recommendations.

Each and every single bank was in compliance with ENDLESS regulatory requirements. Set by the GOVERNMENT. Each and everyone.

And it's the bank employees' knees you want to cap.

What we really need to cap is people like you who need scapegoats and public lynchings to make themselves feel better about themselves.

Since the board no longer performs the roll it should in these companies, then someone should lookout for the shareholders.

That is an incredible statement. The government is saying to shareholders, "We know you can't be trusted to look out for your own interests, so [pointing gun] you will let us look after your interests for you."

None of you think that the billion-dollar bonus pools maybe put the incentives in the wrong places?

Maybe your straw man doesn't think the incentives were wrong. I'm confident most people believe it is possible for shareholders to approve bad incentive plans and that at least some of the plans at financial institutions had perverse features. It is impossible to therefrom conclude that the government should dictate or proscribe incentive plans.

Does anybody even think any more?

No, nobody thinks any more. If they did, they would all agree with you. Fortunately, as the government takes more and more choices out of the unthinking people's hands, their failure to think won't matter because they'll just have to do what they're told.

I can't believe you all are sticking up for bankers who destroyed half the world's wealth.

Cap their pay? We should be capping their knees.

None of you think that the billion-dollar bonus pools maybe put the incentives in the wrong places? There is a reason all these towering pillars of capitalism are teetering, and need government handouts to survive.

Does anybody even think any more?

You know what? Since the board no longer performs the roll it should in these companies, then someone should lookout for the shareholders.

They want to make $100 million in bonuses? Fine; but make it vest over a long period of time.

Who in their right mind would want to give an incentive that becomes the overarching goal of an executive that is immediately within reach?

Running the company becomes an exercise in off-balance-sheet accounting, optimistic forcasts, and even fraud.

It's asinine not to want an executive to live with his consequences. They should be throwing half the board members in jail in some of these companies.

The company I contract for had an engineering department that said I couldn't do what I proposed to do for them. They were very interested in the idea, but reluctant to pay my rate for the year it was going to take to create the product and service. Could I deliver? Would the idea work?

I told them I had faith in my ability to deliver, and I was willing to put my money where my mouth was. I cut my price in half for the development of the product, but upon acceptence, we were to sign a new 1-year contract to develop the service around the product at my full rate. If the service was viable at the end of that period, there was to be an additional year at 1.5 times the rate. I'm now on year 2 of the 1.5x rate, and I have been trying to buy the division from them.

What do auto industry union workers make? What do Union officals make?

As the working talent spreads to other countries. How do they not see this?

Who needs banks anyway?

"Administration officials reply that the Chrysler crisis required bold action. While Chrysler's suppliers, dealers and unionized workers are critical to its survival -- and so is Fiat, which will contribute high-efficiency engines and foreign distribution -- the creditors were expendable.

"'You don't need banks and bondholders to make cars,' said one administration official."

http://online.wsj.com/article/SB124199948894005017.html

Wesley Mouch just called. He wants in on this plan. Maybe I am missing something, but I don't see the logical distinction between Uncle Sam setting minimum wages and maximum wages, so I guess this shouldn't be a surprise. Give it a few months and this type of wage control proposal will likely spread to other industries.

Dave, Nick--

Unconstitutional? Man, that is soooo 2007.

Anyone have an answer to my question about the National Guard Armory? Remember, just askin...

For those interested in the constitutionality, the short answer is that many of the things the government has done for the last 80 years have been unconstitutional. The problem is the Supreme Court, the final arbiter of constitutionality, has become a political institution and they find new and increasingly transparent ways to "interpret" the Constitution so that the legislative branch goes mostly unchecked. Look to the Court's commerce clause jurisprudence from about 1935 onward to see what I'm talking about- cases like US v Carolene Products or West Coast Hotel v Parrish. Don't expect to like what you read though.

Incremental movements to complete economic fascism.

We're pretty much there. Tim is right, not only did most of Wall Street vote for this disaster but for the clowns in congress who are making this possible. This is a complete disaster for one of America's largest industries and it'll be interesting to see this crap wind its way to the Supreme Court. It'll also be interesting to watch boutique firms leave the United States. This country is quickly turning into a swamp.

For those of us concerned with liberty, I suggest that our long-term goals include getting the government entirely out of the business of regulating banks. The government will always abuse any regulatory powers it possesses, and such abuse is particularly destructive to the economy when directed at an industry as fundamental as banking. Historically, the abuse has included forcing banks to offer mortgages that were economically unjustified; the attempt to control wages at banks is just another abuse.

I have been encouraging the dismantling of FDIC and other forms of federal deposit insurance, in favor of a free market in such insurance and in the credit rating of banks. By eliminating federal insurance, we would take away one rationale the government uses to regulate and nationalize banks.

Incremental movements to complete economic fascism.

Nick Curcio - My thoughts exactly. I didn't realize that the Constitution left us so prone to such whimsical centralization.

Anybody know if any of these actions can be draw lawsuits about constitutionality or are the 2010 elections the best hope for a check on this power?

I know a guy who sold his company to a big multinational entity and stayed on as CEO.

About a month ago when when the parent company received bailout money, he was told that his salary would be capped at 500k. He handed in is resignation and left the building for good.

Like many other very successful people, he's worth a lot more than 500k a year and has got plenty of money, talent and experience to move on to greener pastures.

Corporate America is about to lose their best and brightest managers and there is virtually no one who won't have a share in that cost one way or another.

Until they find some loopholes, God help us.

Forget about the financial implications - isn't this simply unconstitutional? Don't Americans, even American corporations, still have the right to quiet enjoyment of their private property? At the least, it is against the spirit of the Declaration of Independence.

This is awesome in the sense that Everest or a 40,000 foot supercell or the asteroid entering the atmosphere to kill everything is awesome. It's really time for the gallows humor to start because liberty is no longer anywhere in anyone's analysis.

I'll reiterate my position from yesterday that resistance is definitely futile.

If I live in a state with a conservative governor, does the governor control the keys to the National Guard armory, or does the White House? Just askin'...

It's pretty clear to me that they know what they're doing. They know that the "government banks" (those that took the fudning) will be playing with different rules than the Non-G banks. If you're a financial type with any kind of talent, you're going to want to work for a Non-G bank instead of a G bank...and the success/performance of the Non-G banks should be far superior to the G-banks in the long run.

They're trying to equalize this new, distorted playing field before this plays out.

It's pretty clear to me that they know what they're doing. They know that the "government banks" (those that took the fudning) will be playing with different rules than the Non-G banks. If you're a financial type with any kind of talent, you're going to want to work for a Non-G bank instead of a G bank...and the success/performance of the Non-G banks should be far superior to the G-banks in the long run.

They're trying to equalize this new, distorted playing field before this plays out.

"Even to those firms that did not accept federal bailout money"

If I were owner(s) of any firm that grossed more than $75,000 a year, I would be looking for a new home overseas for my business and urgently checking shipping schedules to get my basic equipment and tools out on the soonest boat possible.

Those stupid bastards are going to reduce this country to third world beggar status, and it is already too late to stop it.

They may be talking about suffocating the head bone now; but, I guaran-damn-tee you once they get that done, they will work down to the toe bone in short order.

This is a dumb move, unless your intent is to cripple and destroy the finance and banking industry. Obama is the Soviet sleeper the John Birchers always feared. It's going to be a long four years.

Ah yes, the 'audacity of hope!' Well, given that 52% of Democrats believe the 'biggest threat to our country' is 'big business' this move should come as no surprise. (Source: Gallup.com - http://www.gallup.com/poll/117739/Big-Gov-Viewe...) So, while the federal government wants to change compensation packages across the financial-services industry, they can give themselves pay raises and this just in, the ranks of the federal employees not only grows, but their average pay goes from $72,800 in 2008 to $75,419 in 2010! How about a little discipline at 'home' first before injecting themselves into the private sector. (Source: http://www.reason.org/blog/show/1007539.html)</p>

And another costly experiment in central-planning begins--the hope that never dies. At least it will be excellent material for future economics classes.

When it comes to bonuses, most of the anger has thus far been directed against the upper management of the very biggest banks. Those managers get multi million dollar bonuses but the average bonus is well under that figure.

While, a 200k bonus is nothing to sneeze at, it shows that most financial professionals make far less then the huge sums enjoyed by the president of the giant banks.

It was bad enough to go after the people getting multi million dollar bonuses but going after the middle managers of the big banks, the heads of boutique financial firms, smaller venture capital groups and managers of small banks and credit units is death knell for the entire financial system.

Punishing the person who worked for years, under high pressure and long hours, to get a 50k base salary and a 100k bonus will depopulate the financial system of any leadership.

More central planning. Yeah, that'll fix the economy.

If this wasn't such an awful idea, I'd have to laugh at those Wall Street Bankers. A lot of them voted for this clown, and Goldman and JP Morgan converted to banks to get that TARP money.

When you dance with the devil, you should expect to get burned.