First sensible thing I've heard all day!

Last I checked $500,000 was a lot of money.

Don't most places pay their execs like $1 a year in salary, and the rest in other perks? I don't remember where I read it, but it made sense. Saves the exec and the company on income and SS taxes. I'm sure they have to pay out some tax on the perks, but not as much.

Or maybe I did one too many bong hits with Phelps.

Wait, did that guy really say that $500k is not a lot of money? WTF planet does this guy live on?

$500,000 is not a lot of money. $500,000 is not a lot of money? Time to reintroduce these jokers to reality.

This will certainly attract the kind of talent needed to right a sinking ship.

I'm going to have to slightly agree with that consultant. Unless there is some wiggle room for bonuses when the CEO improves the condition of the company, this is going to drive away a lot of prospective people. You have to pay for the best. Not that these ridiculous salaries and bonuses for driving the banks into the ground are OK, but when it comes down to it, you need to spend money to make money.

This is a dangerous play; Corporate leaders will just search out more nefarious ways to strip capital from their operations to reward the executives.

I'm spooked at this move.

I mean, who can live on a measly $500k?
I sure couldn't.

OBAMA IS SUPPRESSING ME! WAHHHHHHHHHHHHHHHH!

/sarc

@mrdeeno: No kidding. At my current salary, it'll take me another 14 years to freakin' come close to saying "I've made 500,000 my entire life." Good lordie.

@yagisencho: In comparison to what CEOs make for companies of that size, that isn't very much.

I think it's pretty simple....if you don't want the pay cap then don't take the money.

$500k is not alot? I'll take it if you don't want it, thank you.

$500k isn't a lot? I must be living in the wrong reality then. Seems to me like half a million a year is a hefty sum.

Class warfare is alive and well. Think with your brains and not with your guts, people.

@downwithmonstercable: That's the thing, though. The CEO doesn't improve the condition of the company out of his own freaking wallet, he improves it out of the companies profits. So it doesn't really matter if the bastard is making 500k or 1mil, he is definitely not going to give up any of his money. We've already seen that close to NO CEO is willing to help out their company, (though I think I've seen one or two stories of CEO's or presidents that have, I could be wrong).

@torgonius: No. A founding CEO's who have massive amounts of stock do this but generally non founding CEO's want truckloads of money. It's a uniquely American thing to have CEO's who make enormously more than their employees. Many other places have slightly more reasonable compensation.

Ration of executive pay to worker pay is Japan was 17:1. USA is 31:1 on average.

It's about time backup centerfielders started making more money than Fortune 500 executives again.

@TheJinManCan:

The real world, where quality executive talent costs. Go ahead and can the CEO, but that EVP whose division made a boatload of money, while the rest of the organization bled cash? He's gone.

@downwithmonstercable: Perhaps so, but there should be consequences for running your company into the ground.

Well, I hope this will cause the companies to NOT seek a bailout using our tax dollars. I'd rather they fail or survive on their own. And if they can survive, they can pay there employees whatever they want.

@downwithmonstercable: The top payed ones did no better than the ones paid less. It seems those prospective people were all under qualified. Maybe re-organizing executive compensation might trim the amount of useless people leading companies.

I was going to say something about $500K not being a lot of money to JUST those people.....but nah. Even if $500K is 1/8th of a CEO's annual salary, that's STILL A LOT OF MONEY.

@torgonius:

That's how Steve Job's gets paid. $1 for the year, but he gets stocks and use of the company jet. So he gets to fly and his growth of wealth is directly related to the performance of the company.

That's how execs should get paid in my mind.

I don't understand what "justify" to the taxpayers means here. If you leave it to a vote, I'm going to guess most taxpayers are going to err on the side of "no."

@downwithmonstercable:

So all these millions we currently pay of bought us "the best"? The ones that have driven up gas prices with speculation, made substandard loans, and run companies into the ground, just to turn around and ask for handouts from the same people they are screwing over?

That's "the best"? I'll settle for "mediocre" for 500k.

@HIV 2 Elway Resurrected:

It should bring in the right people, because they won't be doing it for the money, they'll be doing it because they want to.

The way I live and spend money, $500,000 could last me for 20 years! When these guys scoff at such a huge number, it just shows how out of touch they are with reality.

It's also said to think that getting paid $500,000 is a punishment for them where most people are losing their jobs and homes. Man, that really sucks for them.

@backbroken: Thats an outrage for a different argument...

@backbroken:
Seeing as they obviously do a lot more work, I'd say it's only fair.

To those that are against this on the grounds that it will keep them from hiring "talent", all I have to say to that is that this is an exclusive club, where friends hire friends. Talent has little to do with it. Theres nothing spectacular that these execs have that an MBA grad from University of Florida doesnt have... Other than maybe the experience of already having run a few fortune 500 companies into bankruptcy.. but I digress.

What they really need is fresh ideas, youth, and the balls to approach problems from a new way. What they do NOT need is the same kind of assbackwards, worthless, you-scratch-my-back-I-scratch-yours leadership that has degraded so many companies already. (lets pay 500 million dollars to have our name on a baseball stadium! ok! yes sir! sounds like a great idea sir!) If lowering their salaries means running off what you call 'talent' and replacing it with people itching to work, try new ideas, and turn companies around, then I am all for it.

I find it unacceptable that they cannot force these restrictions on companies that already took the bailout. They should be able to do something to force them to "opt-in" to it. These financial companies change the terms on consumers after the fact all the time.

I don't care where you live, 500k will buy you whatever you need and then some. Be it NYC, Cali, whatever, 500k is plenty.

Especially when your job entails leading a failing company that uses taxpayer dollars to prop itself up.

I'd rather see their pay tied directly to profits. Then maybe they would care if they drive a company into the ground with bad decisions. "Oh crap, I am only going to make $2,000 this year...guess I should have made better decisions".

About f'in time.

If a small business owner runs his company into the ground like Citibank,Bear Stearns , and other bailout groupies he gets no bailout, no salary, no bonus, nothin.

Heck, if an entepreneur goes bankrupt due to slow business, he gets nothing.

$500,000 a year to run a company that, all things being equal , shouldnt exist anymore is generous.

@TheJinManCan: I'm not sure if I understand what you're saying. What I am saying is that paying someone $500k is probably not enough to attract top talent. But when you give incentives likes bonuses for improving the stability and performance of the company, that would help attract those types of people who will work to get it.

@dwarf74: These aren't the people that made poor decisions. Most of them have already been removed or have resigned. Struggling companies already have removed many bad apples and now need to attract top talent to fix their problems. Publicity stunts like this one only inhibit that. I thought the election was over, can't Obama quit campaigning?

@downwithmonstercable: I would usually agree with you but as far as I am concerned the executives of any company that had to be bailed out by the feds should have his income confiscated, not earning millions of dollars from the taxpayers.

@HIV 2 Elway Resurrected:

Of course, paying real money attracted the sort of talent that sunk the ship in the first place.

@Jon Klein: What sort of fantasy land do you live in?

Well.. I hate to break it to you, but for a senior exec, $500k is terribly small. especially if it is a total compensation cap, versus a salary cap. (Though stock can be a huge motivator..)

But, this provision is soley for companies on the government teet.. not for every company.. I have no problem with this. If you are in danger of loosing everything and on public assistance through TARP, then you should take the cut as part of your survival strategy for the company.

Now.. if they wanted to make a $500K cap for everyone in the country, it would be devestating. Top talent and leadership would bail out of the use and take most industry, and their tax bases with them.

@cmdrsass: I'm thinking with my wallet, thanks.

If taxpayer money is paying the CEO's salary, makes sense that we have some say in what that salary is going to be.

The rule will only apply to companies that receive future bailout funds.

Future bailout funds? Does that mean all the banks and financial institutions that already received bailout funds are exempted?

If this applied to private companies I would object, but it doesn't. These companies have been nationalized by the bailout and are now subject to federal regulations, including this one. If they didn't want to deal with more rules, they shouldn't have taken the taxpayer's money.

@nicemarmot617: If a bank, or anyone for that matter, lends you money you agree to terms at the time the loan is made. You don't get to add or change terms after the fact. That is basic basic contract law.

@cmdrsass: This "class warfare" meme has GOT TO STOP. Why is it only "class warfare" when the rich are being criticized or expected to take responsibility or be accountable to their company, to the nation or to taxpayers? The NEXT time someone complains about poor or middle class people receiving "handouts" I will go class warfare all over somebody's head!

That being said, I'm not sure that mandating a salary cap is the best course of action. I am much more interested in these companies opening their books to scrutiny so that taxpayers know where the dollars are going and for the government to have a plan to monitor performance and make sure we'll get our money back. On the other hand, these people are kind of dumb handing out cash like candy at a time when their companies are about to go under. I can't exactly blame Obama for having no confidence in their ability to be prudent or frugal.

This is a good idea, I just hope Obama also decides to re-open union contracts for the auto companies that took bail out money.

Starts holding breath....now.

:dead:

Pay them what the rest of the country is making on average for a salaried worker. Something like $40-50k, then they will come down to the reality of the rest of the population.

@downwithmonstercable: Most CEOs do not make the money for the company. They merely go with the flow...There are exceptions to every rule and I think Apple is one of them. He did lead properly and it shows with how well the company is doing. Apple isn't failing and they don't need a bailout. Companies that are failing and need to receive a bailout should not be allowed to pay their CEO more than $500,000. Which BTW is a TON of money. I work my butt off for 1/10th of that a year.

How hard would it be to go through a list of people facing foreclosure, see who got fucked, and just pay off their damn houses with the bailout money and leave out the middle man.

Pretty hard I'm sure, but atleast no executives will have the chance to not get it where it belongs.