Obama Plans To Cap Executives Pay At $500,000 For Bailout Receivers
At least the government has seen the lifestyle of executives. President Obama wants to cap the pay of executives whose firms receive government financial rescue funds.
During a press conference on Tuesday, President Obama said, “If the taxpayers are helping you, then you’ve got certain responsibilities to not be living high on the hog”.
An administration official speaking on anonymity said that if a firm wants to pay executives more than the $500,000 cap, they can do that with stock that could not be sold or liquidated until they pay back the government funds.
This pay limitation was proposed after revelations that Wall Street firms paid more than $18 billion in bonuses in 2008 during this economic hard times.
According to the official, the proposals include:
_ Requiring top executives at financial institutions to hold stock for several years before they can cash out.
_ Requiring nonbinding “say on pay” resolutions _ that is, giving shareholders more say on executive compensation.
_ A Treasury-sponsored conference on a long-term overhaul of executive compensation.
