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Dec

21

Bush demands concessions from auto industry chiefs, but bank men? Not so much


From the AP which I can’t quote extensively so you’ll need to go read it:

_Even where banks cut back on pay, some executives were left with seven- or eight-figure compensation that most people can only dream about. Richard D. Fairbank, the chairman of Capital One Financial Corp. (COF) (COF), took a $1 million hit in compensation after his company had a disappointing year, but still got $17 million in stock options. The McLean, Va.-based company received $3.56 billion in bailout money on Nov. 14.

_John A. Thain, chief executive officer of Merrill Lynch, topped all corporate bank bosses with $83 million in earnings last year. Thain, a former chief operating officer for Goldman Sachs, took the reins of the company in December 2007, avoiding the blame for a year in which Merrill lost $7.8 billion. Since he began work late in the year, he earned $57,692 in salary, a $15 million signing bonus and an additional $68 million in stock options.

A $15 million signing bonus. What IS that? (Don’t be daft – I know what signing bonuses are about but the guy just started one year ago, when all this could be seen rattling and they give him that kind of money?)

So the question remains: what did they actually do that earned them that money? What exactly are the compensation committee members thinking?

We can figure out what they’re not thinking about pretty easily.

So what’s my explanation of the different treatment given to the auto guys?

The bankers are all in Washington.  They are in office in government branches that matter. The auto industry folks are not.  It’s an inside-outside philosophical preference in terms of how the people in D.C. judge who, outside D.C., really matters to our economy and to what extent.

So when we talk about appointments for the next administration, this is, in part, what we’re looking at: where do the people come from? What will be their philosophical preferences for who really matters to our economy and to what extent?  I would argue that it is that change that people like myself, who were not bald-faced supporters of Barack Obama but rather committed Democrats, feel we supported and pray gets implemented at every level.  It ain’t socialism, but it sure as hell doesn’t approve of the bank men getting away with our billions while the auto folks are forced to grovel for scraps.

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By Jill Miller Zimon at 11:49 am December 21st, 2008 in Business, Economy 

Comments

4 Responses to “Bush demands concessions from auto industry chiefs, but bank men? Not so much”

  1. 1 The Reverend on December 21st, 2008 7:21 pm

    Preach on.

    It’s hard not to be cynical here. Banks basically received a blank check…still no oversight today…for $350 billion, and Hank-boy wants the rest. Banks don’t make stuff, they’re much too serious and intelligent than that.

    Automakers actually make something and only asked for a $14 billion loan…..but they’re not serious and intelligent people like the bankers. Bankers get bailouts.

    And besides, haven’t you seen how those autoworkers sweat, and wear, like, work clothes every day. Anyone who would do such a thing should work for less, simply by definition.

    See Jill, if union autoworkers don’t take a wage beating…then the next thing you know, undocumenteds will ask for more….where would it all stop?

    But we continue to hope.

  2. 2 Loraine Ritchey on December 22nd, 2008 10:46 am

    Jill from what I am understanding is that most of the governments are helping out their own auto industry and from today’s BBC will Japan be far behind
    Toyota braced for historic loss
    http://news.bbc.co.uk/2/hi/business/7794888.stm

    Does the US have a level playing field in all of this? I seem to remember the US Steel industry struggling against the overseas steel makers as they were being subsidized weren’t they by their governments- if my aging brain recall it was called dumping????

  3. 3 Jill Miller Zimon on December 22nd, 2008 4:51 pm

    Reverend, your comments have been very lucid and not too over the top lately – I’m nodding my head in agreement with most of them, this one included.

    Situations like this really remind me of when I lived in New Haven and there was a blizzard. I called the city to find out about the parking ban and specifically asked where I could and could not park my car. They told me and I followed their instructions. The next day, my car had been towed. I was soooooooo angry – I had been the best citizen I could be, specifically inquiring etc. So the city tells me I have to pay all this money to get my car and pay a ticket and I tell them about how I asked etc. and they don’t budge. So I pursue a complaint against them, immediately, before I even got my car, and lo and behold – there was a tape of the call and they agreed that I’d followed what I’d been told and I got my car and didn’t have to pay anything.

    But it’s that kind of thing – where you try to follow all the rules, even go the extra, and the people in control/power still try to mess with you. I HATE that. lol

  4. 4 Jill Miller Zimon on December 22nd, 2008 4:54 pm

    Loraine, that is an excellent point. I have heard some news stories about that too. I suppose part of the problem is that some of those countries are bona fide socialist countries and so Americans who even suggest that they think we’re the slightest bit socialist need to take a hard look at what Britain and Europe are doing. I’m not sure about Japan – are they considered socialist? I don’t know anything about their tax structure etc.

    Anyway – there’s not doubt their gov’ts embrace a philosophy of more societal responsibility. The degree to which as a system some people will stick to believing that we should not help out fellow Americans, and which fellow Americans, is truly depressing.

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