Foreclosures now Closing in on Executives
Posted on March 6, 2009
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With foreclosures closing in on the highflying executives, their lives are not going to be lined with dollars anymore. President Obama has announced $500,000 as the limit for financial executives of firms that have taken part of the federal bailout fund. Obama was reacting to public ire over bulky remuneration being given to the company leaders with money that has come from the government dole out.
Reports came in from Wall Street in the last week of January that more then $18 billion had been distributed as bonus at the end of 2008. This was against the background of these companies taking billions from the government so as to stay afloat and keep the financial system of the country running.
Obama sternly said, “We all need to take responsibility. And this includes executives at major financial firms who turned to the American people, hat in hand, when they were in trouble, even as they paid themselves their customary lavish bonuses.” He was speaking in the foyer of the White House.
Simultaneously with the speech of Obama a statement was issued from White House that said the new rules would see to it that the pay given to the financial brotherhood “is closely aligned not only with the interests of shareholders and financial institutors, but with the taxpayers providing assistance to those companies.
Speaking on the occasion Obama was trying to put down the Republicans that had opposed his $800 billion spending measures saying that the focus should be more on cutting taxes. Obama argued, “I reject that theory, and so did the American people when they went to the polls in November and voted resoundingly for change. So I urge members of Congress to act without delay.”
The placing of a ceiling on pay packets was to be the basis of a new policy on spending the remaining balance from the $700 bail out funds. The spending of the first instalment has come in for serious criticism for having focused mainly on banks and financial houses rather than reaching out to the millions facing foreclosure.
Obama has taken a transparent attitude and while criticizing others he has not spared himself either. He admitted to having “screwed up” the matter of appointing some to important posts without knowing their lapses in tax payments. He accepted the resignations of two of his top nominees. It was undoubtedly a major setback for the young administration facing Herculean problems.
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