I call it implicit nationalization. It's no better than the real thing. The New York Times reports:
institutions that are getting government bailout funds have been told
to put off evictions and modify mortgages for distressed homeowners.
They must let shareholders vote on executive pay
packages. They must slash dividends, cancel employee training and
morale-building exercises, and withdraw job offers to foreign citizens.
As public outrage swells over the rapidly growing cost of
bailing out financial institutions, the Obama administration and
lawmakers are attaching more and more strings to rescue funds.
conditions are necessary to prevent Wall Street executives from paying
lavish bonuses and buying corporate jets, some experts say, but others
say the conditions go beyond protecting taxpayers and border on social
Some bankers say the conditions have become so
onerous that they want to return the bailout money. The list includes
small banks like the TCF Financial Corporation of Wayzata, Minn., and Iberia Bank of Lafayette, La., as well as giants like Goldman Sachs and Wells Fargo.
say they plan to return the money as quickly as possible or as soon as
regulators set up a process to accept the refunds. On Tuesday, Signature Bank of New York announced that because of new executive pay restrictions in the economic stimulus package, it notified the Treasury that it intended to return the $120 million it had received from the government only three months ago.