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Conflicted Sununu: The Real Problem Is That CEO Pay Limits Are Too Tough
Yesterday, the panel overseeing bailout spending on behalf of Congress issued its latest hard-hitting report, which criticized the Treasury Department's approach to the program and called for top execs at major banks to be fired.
But perhaps the most interesting thing about the report is the "alternative view" that accompanied it, from Republican panel member John Sununu.
Before we look at Sununu's objections, a quick reminder: In February, TPMmuckraker reported that the former New Hampshire GOP senator has what appears to be a major conflict of interest: he sits on the board of a subsidiary to Bank of New York Mellon -- a firm that both received TARP funds itself, and has contracted with the Treasury to help run the program. In an email to the Associated Press, which picked up on the story, Sununu said he didn't see this as a conflict.
As we noted in our original report, Sununu from the start has taken a notably bank-friendly approach to his work on the panel. In February, he dissented from a previous panel report that took a hard line with Wall Street, instead recommending going far easier on the banks, and emphasizing the need to rein in Fannie Mae and Freddie Mac.
This time around is no different. In his latest dissent, Sununu seems primarily concerned to determine why banks might be choosing to decline TARP funds -- the implication being that Treasury's demands are overly burdensome. He asks:
What factors have driven roughly 200 financial institutions to decline CPP funding after their applications had been approved, and what implications does this have for the success of the program?
And:
To what extent has the recent debate and proposed legislation regarding taxation and limitation of executive compensation discouraged firms from participating in CAP, TALF, and the PPIP?
So let's recap. The guy who sits on the board of a company affiliated with a bank that has both been bailed out, and administers the bailout program, thinks that the main problem with the bailout is that restrictions on executive pay have been too onerous on the banks.
Anyone else see anything wrong with this picture?
Josh
Zachary
First-off, why is John Sununu still on the Board, given his direct participatory benefit derived from the programs? If this is not a textbook case of the "fox guarding the hen house", I do not know what is.
These arrogant asses should be lucky Ron Reagan is not president this time around. If you remember, he shutdown the offensive institutions and threw a lot of the culprits... sorry... CEOs, in prison. Without hesitation or shame, I believe they should all be fire, like Waggoner; publicly shamed, all assets confiscated, including those held in Trusts and other traditional "judgment proofing" games. Like with the Madoff case, I cannot believe there is even a discussion about that near $100m held by his wife. We do have forfeiture laws, and we sure never waited for convictions before with, say, suspected drug offenders. Then, these executives need to be put on trial for their frauds. I mean, these few confidence artists turned the entire financial industry into one global ponzi, pyramid and any other deceptive scheme you can think of. And the worst of it, the Congress, Presidents Reagan's, Bush's, Clinton's and brain damaged Bush's enthusiastic help doing it (Do not let me forget the quarterback Phil Graham) by dismantling all the rules that had served us so well since the 1930s. We were doing just fine under those rules. The late '70's problems were extra bad due to policies of Nixon (ie price controls, etc) and the gratuitous recession that follows all wars.
Let us pray that President Obama wakes-up and fires Secretary Geitner, who is doing the same stupid shit that the Japanese did and not what President Reagan did. This is not a shallow or short-term problem, it is deep and the balance of labor wages are severely out of whack.
This sucks, but house costs must come down to balance with wages or wages must rise (which doesn't suck, and this coming from a business owner). It would make all the difference if we could just stop f'ing-around and just nationalize healthcare.
Thanks for reading, and if you disagree, speak-up with a better idea.
April 8, 2009 9:24 PM | Reply | Permalink
Nationalize the banks. We own them anyway. Once they are on their feet, taxpayers have been reimbursed and regulations reinstated, "Let'em fly again"!
April 18, 2009 2:56 PM | Reply | Permalink