by Arlos » Thu Dec 18, 2008 3:07 pm
Then why not demand replacing the top management as condition for giving them the money? Keeps all the average people employed, you know, the average working types who WEREN'T responsible for driving the companies into the ground? Plus it also gets rid of those who DID make the mistakes. In point of fact, they were discussing that very possibility.
Personally, I'd rather see bailout money go to companies that actually PRODUCE something than to some of these wall street firms. Some of whom (hi, AIG) are planning on using taxpayer money to pay out millions upon millions in "retention bonuses" to make sure their "valued executives" don't "leave for other opportunities." That makes me physically ill.
First, WHAT opportunities? Tens of thousands of financial people are out of work. Where are they going to go? Second, those executives had direct responsibility for REQUIRING the bailout. Why in hell would you WANT to keep them, when they just ran the business into the ground? They should be FIRING them, not retaining them. Third, why should *ANYONE* at a failing company get a bonus, unless maybe they were in the lone profitable division or something? Lastly, how DARE they use taxpayer money for that bullshit?
Theoretically, the financial bailout had language to prevent that. But, as I learned recently, appearances are different than actuality. The original language of the bill assumed that the treasury would be buying troubled assets at auction, as that's what Bush's treasury people said they were going to do. So, the bonus limits were written in to apply only to firms who sold assets at auction to the federal government. Seeing as how the treasury hasn't spent one dime holding auctions, and instead just handed money out, those bonus limits don't apply, and Bush's people have already indicated there's no way in hell they'll go along quietly with changing the language to fix the loophole.
Oh, one other fun fact for you. Check out Goldman Sach's last annual report. For the year, they had a profit of 2.3 billion dollars. Last year, they paid a tax rate of 34.1%. Seems generally reasonable, yes? Guess how much they're paying this year? 1%. Yep, that's right, ONE percent. They attribute this drop to, and I quote, "changes in geographic earnings mix."
Translation, they are hiding most of their money in offshore accounts in places like the Cayman islands which have no tax rate, to get around American tax laws. A congressman from Texas summed this up rather well when he said, "With the right hand out begging for bailout money, the left is hiding it offshore."
Makes you love our financial companies, doesn't it?
-Arlos
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