paying-attention

Today's New York Times offers an opinion on executive pay, in an editorial titled "Money Really is Fungible." An excerpt:

Just weeks after the Treasury Department gave nine of the nation’s top banks $125 billion in taxpayer dollars to save them from unprecedented calamity, bank executives are salting money away in billionaire bonus pools to reward themselves for their performance.

Outraged? The bankers (who didn’t anticipate the subprime crisis) were ready for that. So they are assuring everyone that this self-directed largess won’t be paid with the same dollars they got from taxpayers. They’ll use other ones.

What we want to know is will they be marking the bills so they can be sure which is which?

Unfortunately, the legislation that created the $700 billion rescue fund barely touched on the problem of executive compensation — limiting bonuses only when they are found to have been based on inaccurate statements of earnings or when they are deemed to encourage bankers to take “unnecessary and excessive risks.” The new Congress should impose tighter limits on executive pay at banks taking taxpayer money.

So lemme get this straight: It's okay to raid employee pension funds and shareholder dividends to pay off debts and keep the company afloat, but the executive bonus pool is sacrosanct? Get your pitchforks, it's time for an angry mob!

There is a reason that public employees tend to make less than their counterparts in private industry. It is because taxpayers are stingier with a dime than private board members can afford to be. Maybe it hasn't dawned on these people yet that their jobs are currently dependent on public financing.

Merriam-Webster online says that the adjective fungible comes from the New Latin fungibilis, from Latin fungi, to perform. It has the same root as the word function. Their definition: being of such a nature that one part or quantity may be replaced by another equal part or quantity in the satisfaction of an obligation; example "oil, wheat, and lumber are fungible commodities."

Sorry, but I'm not willing for my tax dollar to replace the function of money that was lost in bad business deals.

The whole reason for the ridiculous compensation levels was that the bank officials were willing to personally share the risks that they lead their companies into. If we taxpayers are assuming the risk for their decisions, then the bonus is for...what? Looking good in an expensive suit?

Labels: $700 billion bailout, executive bonuses, The New York Times, US taxpayers