Where’s that pesky pay czar when you need him? You know, Kenneth Feinberg, the poor fellow who was caught in the middle of the Fox News/White House war, as the administration tried to exclude Fox News from doing a press pool interview with him? That poor sap who has decided to cut executive pay at certain banks?
Obama’s “special master” on pay will order deep cuts in the salaries of top executives of companies on government support on Thursday.
“Pay Czar” Kenneth Feinberg will announce cuts to salaries by an average of 90 percent, according to a variety of reports on the matter.
Yes, he’s doing the job of dictating to companies which took government (read: taxpayers’) money exactly how much they are allowed to compensate their top execs. And next he’s going to look at the paychecks of the smaller fellows, too.
Before he does that, however, perhaps he should take a look at the compensation package received by the new CFO of Freddie Mac, Ross Kari. Business Week reports:
The government-controlled mortgage finance company is giving CFO Ross Kari compensation worth as much as $5.5 million. That includes an almost $2 million cash signing bonus and a generous salary that could top $2.3 million.
The Federal Housing Finance Agency, which oversees Freddie Mac, approved the pay package. A spokeswoman pointed to a statement that justified the agency’s approval of the pay, which was done in part because the amount was comparable to what others in the financial services industry make.
Let’s take a look at that again:
“A spokeswoman pointed to a statement that justified the agency’s approval of the pay, which was done in part because the amount was comparable to what others in the financial services industry make.”
But aren’t those others in the financial services industry making too much? Isn’t that why their paychecks were slashed by an average of 90%?
How do we justify cutting the salary of executives at companies who received TARP funds, while allowing a gold-plated compensation package to an executive at yet another company which receives government funding? The money all comes from the same place, whether it’s TARP funds or “conservatorships” as in the case of Freddie Mac and Fannie Mae. In fact, the argument could probably be made that Freddie and Fannie have taken far more taxpayer dollars than most banks took in TARP funds.
I’m not saying that Ross Kari isn’t worth every penny of the $5 million he will receive. He may be; in fact, I hope he is.
But to play favorites like this is unconscionable.