CNN: House OKs bill taxing bailed-out firms' bonuses. — Page 2

"The ones that are getting attention in the press are. However, the way the bill is written, the impact will be very broad. It could impact mid-level managers, engineers, underwriters, systems folks, etc."

Oh, well. Them's the breaks. You work at a company that takes billions of money in bailouts from taxpayers, you lose your bonus. Makes sense to me, I think. Would they rather lose their jobs entirely?

And I've always wondered why they didn't just bloody well defer the bonuses.

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Sounds like you want to punish the entire class...

I agree with MB - I might be OK if the limit on comp was increased, and it focused on individual compensation rather than a household.

If you have two mid level professionals working in a major city for a company that received TARP funds, they will probably be impacted. It will encourage those folks to leave and try to find other jobs in companies that did not receive bailout funds, which will undermine the company's recovery.

If you want to focus on individual compensation, and put it at $500,000 per person including bonus, I might not have such a strong reaction. But the $250k on a household (only one of whom may work for a TARP receiving company) is too low a threshold.

And what about the folks who did not screw up their jobs, and are vital to turnaround the company. The IT resources, accountants, and others who had no role in the underlying problem, but are vital to keep the company going?

Two IT resources working for a company that keeps it online website going will most likely make more than $250k aggregate. You are punishing the innocent for the sins of senior management.

Wow.

So, these folks should get it coming and going, from both their company's and the government.

Great.

I have a baby that got thrown out with some bathwater if anyone wants one.

Well, I just wrote to both my senators sharing my opinions of this bill.

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Whereas true fiscal conservatives suffer no delusions that the current republican congress is anything but, the vote was split down the middle of the party, 85Y to 87N.

democrats, however, may have a harder time justifying the vote; all but 6 voting yea.

Congress legislating judgment and punishment at one fell swoop? The forefathers are rolling in their graves. Even more so since the evidence that the issue was discussed at length on the floor of congress prior to the bill passage and fund distribution only proves the whole matter to be serious backpedaling.
How your representative voted

"The ones that are getting attention in the press are. However, the way the bill is written, the impact will be very broad. It could impact mid-level managers, engineers, underwriters, systems folks, etc."

Um, no. Even with bonuses those positions don't earn over $250K a year outside of Wall Street, if even there (and engineers almost never get bonuses anyway).

No. In 2006, less than 2% of households nationwide had household incomes over $250,000 per year.

No sympathy here for any of them.

There is never *not* class warfare when the wealth gap is as large as it is now. Only now it's the upper end whining and resorting to that argument.

You need to do more research to educate yourself about union wages in the trades.

"Bonus are out of control, especially for upper/senior management."

But who are you to determine that? Do you know how much profit they bring into a company and how many jobs are inter-related to their jobs.

I also notice that this is being targeted only at business people. You don't hear a word about Hollywood stars and their gross salaries. And they do less work than these business people.

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Goth, the bonus structure of many (not all) organizations that deal with selling stuff is premised upon a variety of factors. In many organizations, they are different calculations depending upon job function. For example, any bonus I receive is premised up my performance, company performance, return on investment and the like. I do not sell products, but provide support and services.

Others companies where sales are key have bonuses calculated solely on their ability to hit a certain number. There is an inherent conflict of interest there in my opinion. It can lead to cutting corners in order to make the sale, regardless of whether that sale is in the long-term best interest of the company. That structure in my opinion is out of control. And, to your point, many of them do not bring profit into the company if the items is missold, or sold in a manner that can create liability - so the sales figure alone should not be used as a metric for any bonus. It should be one of many factors.

Retention bonuses in the amounts rewarded by AIG and Merril similarly are problematic, because they really are not being used as a bonus, but a bribe. There is a little bit of financial extortion going on here, with those that drove the companies into the ditch not being willing to give directions out without getting a bucket of money.

And, we are only talking about entities that have received government bailouts because the underlying issue is whether the US taxpayer should be paying bonuses. If these companies were profitable, and had not invested so poorly and sold products that were no better than a house of cards (credit default swaps) we would not having this conversation in the first place. So your last comment is nothing more than a red herring. Moreover, how do you now how much work people in hollywood do, and whether or not it is more than those at Merril or AIG? You don't.

Updated On: 3/21/09 at 03:04 PM

These are national charter banks, the states have no jurisdiction. The states did try to prevent these entities from growing as they did by challenging some reorganization tactics but the Supreme Court shot them down.



Watters v Wachovia

Updated On: 3/21/09 at 08:31 PM