How The Banks Are Spending Our Bailout Money
The Associated Press reports; study finds $1.6B went to bailed-out bank execs:
Barney Frank has a good take on it:
While U.S. families are going without Christmas gifts the banks are using those same family's tax dollars to pay for, of all things, financial planning services:
I don't know if it's possible within the hastily written, loosely worded bailout legislation but I'd like to see congress demand the return of all monies used for excessive compensation.
California Congressman Brad Sherman has the right idea, he wants them to come before Congress, like the automakers did, and spell out their spending plans for bailout funds.
The rewards came even at banks where poor results last year foretold the economic crisis that sent them to Washington for a government rescue. Some trimmed their executive compensation due to lagging bank performance, but still forked over multimillion-dollar executive pay packages.
Benefits included cash bonuses, stock options, personal use of company jets and chauffeurs, home security, country club memberships and professional money management, the AP review of federal securities documents found.
Barney Frank has a good take on it:
"Most of us sign on to do jobs and we do them best we can," said Frank, a Massachusetts Democrat. "We're told that some of the most highly paid people in executive positions are different. They need extra money to be motivated!"
While U.S. families are going without Christmas gifts the banks are using those same family's tax dollars to pay for, of all things, financial planning services:
At Bank of New York Mellon Corp., chief executive Robert P. Kelly's stipend for financial planning services came to $66,748, on top of his $975,000 salary and $7.5 million bonus. His car and driver cost $178,879. Kelly also received $846,000 in relocation expenses, including help selling his home in Pittsburgh and purchasing one in Manhattan, the company said.
I don't know if it's possible within the hastily written, loosely worded bailout legislation but I'd like to see congress demand the return of all monies used for excessive compensation.
California Congressman Brad Sherman has the right idea, he wants them to come before Congress, like the automakers did, and spell out their spending plans for bailout funds.
"The tougher we are on the executives that come to Washington, the fewer will come for a bailout," he said.Next time you go to the bank, remember what their executives think of you.
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Frank Rich has a good column on this today.
I think they'd have made better use of our tax money if they'd carted it over to the state prisons and handed it out to convicted drug dealers. At least the drug dealers don't sell a product unless they get paid or if they don't get paid they exact great bodily harm upon anyone trying to rip them off.
December 21, 2008 1:50 PM | Reply | Permalink
Thanks for the heads-up re Rich column; Who Wants to Kick a Millionaire?. Madoff was like a cancer decimating his own. One Rich line that stands out, "A Jewish financier rips off millions of dollars devoted to memorializing the Holocaust — who could make this stuff up?"
You know how all politics are local, my son works in cancer research. One of the key funders is the Steven Spielberg Foundation, a victim of Madoff's sociopathic inhumanity.
December 21, 2008 4:37 PM | Reply | Permalink
Do these companies have to pay taxes on their bailout funds?
It would be pretty sweet if the companies had to pay a tax, and then the execs who got bonuses with the money had to pay windfall taxes (or whatever they call tax on bonuses) and then they had to pay it back with interest.
Wishful thinking, but sweet nonetheless.
December 21, 2008 3:19 PM | Reply | Permalink
I'm still fuming that Citicorp, recipient of $$$$$ of bail-out money and former home of I-can't-remember-who among the Bush financial elite, is using its share of taxpayer "contributions"
a) to "sponsor" the Rose Bowl game; and
b) to pay $400 MILLION for "naming rights" at the new Mets stadium.
Now there's some easily identifiable money that Elizabeth Warren and the other "overseers" could pick up right off the table and return to taxpayers.
Why is this outrageous squandering of taxpayer funds allowed, and why is there no outrage?
December 21, 2008 4:16 PM | Reply | Permalink
I'm outraged.
December 21, 2008 4:36 PM | Reply | Permalink
Ya!
December 22, 2008 1:25 AM | Reply | Permalink
Are you thinking of Robert Rubin of the Clinton administration?. He's a big cheese at Citicorp.
December 21, 2008 5:53 PM | Reply | Permalink
Taxpayers too have a bailout safety net – it’s called Unemployment insurance for up to 9 months to go find yourself another job in a job market where there none because Congress shipped most of them overseas (NAFTA, CAFTA, globalization, etc.) and approve Bailouts to financial institutions without accountability, transparency, or an ethical duty to look out after the average taxpaying American.
Ive lost faith in both parties, we need a benevolent dictatorship...the M-F’ers in Congress voted themselves another PAY RAISE: According Fox, ‘Members of Congress make an average of $169,300 a year, with Congressional leaders making slightly more. House Speaker Nancy Pelosi, D-Cailf., makes $217,400, while the majority and minority leaders in the House and Senate each make $188,100. The raise will increase the average salary to about $174,000, up 2.8 percent. Pelosi’s and Senate Majority Leader Harry Reid’s offices did not respond to FOXNews.com’s requests for comment. Pay raises for public officials, whether at the federal, state or local level, usually spark outrage among taxpayer advocates. But the deepening financial crisis has led even a few lawmakers to object.’
December 21, 2008 5:45 PM | Reply | Permalink
I WANT INVESTIGATIONS
I WANT PEOPLE PUT IN PRISON
I WANT RESTITUTION
I COX PROSECUTED AND PUT IN PRISON
I WANT JUSTICE NOW
December 21, 2008 7:00 PM | Reply | Permalink
I had just read your "Christmas Spirit" post, and I'm sorry, but I really thought this said "I WANT PROSTITUTION."
But you're right, restitution is better.
December 21, 2008 10:05 PM | Reply | Permalink
I had just read your "Christmas Spirit" post, and I'm sorry, but I really thought this said "I WANT PROSTITUTION."
But you're right, restitution is better.
December 21, 2008 10:05 PM | Reply | Permalink
YOU DONT HAVE TO SAY IT TWICE. I get the point
December 22, 2008 1:37 AM | Reply | Permalink
Sorry, I dunno why it did that...
December 22, 2008 8:27 AM | Reply | Permalink
Actually I would be for more prostitution but they charge too much
December 22, 2008 8:41 AM | Reply | Permalink
Prosecution and restitution, when combined by skimming rather than reading, form the word "prostitution"?
Cosmic, especially in this capacity.
December 22, 2008 11:45 AM | Reply | Permalink
Combine all that with his earlier post describing a particularly attractive Food Network chef. Brain already in the gutter + prosecution + restitution + skimming the all caps = PROSTITUTION!
December 22, 2008 1:54 PM | Reply | Permalink
In a similar vein:
http://www.huffingtonpost.com/2008/12/21/bailed-out-execs-still-fl_n_152727.html
December 21, 2008 10:04 PM | Reply | Permalink
Steve - thanks for the post. I'm confused why the article is talking about 2007? We all know that before the meltdown the banks were paying out big bonuses. So I don't understand what's "news" about the story that the AP ran.
We know that banks are still paying out bonuses right now for fiscal '08, but the bonus numbers cited in the AP article were all paid with the banks profits, not from the TARP funds.
December 21, 2008 11:27 PM | Reply | Permalink
Because middle class Bill all of the bonuses paid to the bankers prior to the TARP being disbursed is all one pile of money - our tax dollars were spent to cover the bonus money that Mr Thain was paid prior to the Paulson Ponzi scheme aka the TARP bailout - its all one revenue stream ...there were no bank profits after the bonus money was paid - Paulson extorted us to cover the laying theiving bank bastards getting paid huge sums of bonus money -
( please excuse the poor grammar its really early in Austin -and I am really really mad about the TARP blackmail that has been perpetrated on we the people )
December 22, 2008 4:56 AM | Reply | Permalink
Al thanks for the response. But I disagree that it's all "one pile of money". If you are an opponent of the TARP (and I definitely am) then that's one thing.
But my point is that the AP article is ingenuous to say "how dare the banks receiving TARP funds pay people huge sums of money during the bubble". The AP writer is trying to imply that the banks are using TARP funds to pay massive bonuses which isn't the case.
I guess I just hate the AP which is why I commented in the first place.
December 22, 2008 8:45 PM | Reply | Permalink
Bill,
Let me be clear I am against the TARP scheme without transparency -where did our money go ,for what purposes, and by what means will be paid the money back ?. And if Paulson had not shaken down Congress for those tax dollars Thain would not have been paid his bonus - his bank was insolvent without the TARP money .
And Mr Blue you are absolutely correct we are closing out all of our BOA accounts and going with A-1 Credit Union here in Austin .
December 28, 2008 8:53 PM | Reply | Permalink
They will protect their inner circles from losing their millionaire status, first and foremost.
Then the little guys will get the crumbs that are left over. A trillion dollars will be divided up so 90% goes to the millionaires and billionaires and 10 percent goes to high-end homeowners.
If that money had been used to revalue the American Home, (you know, the American Dream place that the Bush Era Wall Street turned into a nightmare ...) this mess would be over today.
December 22, 2008 11:43 AM | Reply | Permalink
It is time we hold those financial institution accountable for how they use taxpayer money. I call it "Take Back Our Money". We can kiss the TARP money good-bye. We should accept that congress and the president just gave a huge gift to financial institutions.
If we bank or have an account with a financial institution that has received TARP money, we should close that account and open a similar account at a local credit union.
December 22, 2008 12:37 PM | Reply | Permalink
This administration: Raid the treasury - first, last, and always.
December 22, 2008 2:04 PM | Reply | Permalink