NEW YORK — An angry US public and Congress are pushing to snip
the rip cord on golden parachutes used by fat cat CEOs to escape Wall
Democrats in Congress -- set to resume emergency talks Friday with
their Republican counterparts on a 700-billion-dollar
(478-billion-euro) bailout for the financial industry -- insisted that
any agreed package include restrictions on executive pay.
They caught the mood of a nation sickened at watching the titans of
finance walk away from Wall Street disasters not only unscathed, but
"The wealthiest people, those... in the best position to pay, are being
asked for no sacrifice at all," read a petition to Treasury Secretary
Henry Paulson, which by Thursday, after three days, had 32,600
The petition, organized by independent Senator Bernie Sanders from
Vermont, attacked what it described as the Treasury's attempt to let
bungling executives "continue to make exorbitant salaries and bonuses."
Those gigantic pay checks, bonuses, and Midas-like farewells
encapsulate what the public sees as Wall Street's greed-is-good
For example, the CEO of bankrupt Lehman Brothers, Richard Fuld,
received total compensation of 71.9 million dollars in 2007, including
stock, bonuses and other pay, according to a survey published by Forbes
Martin Sullivan, the chief executive of AIG, who left the insurance
giant before it was rescued this month by the federal government,
received 14 million dollars, a survey in USA Today said. He also quit
with a severance package worth 47 million dollars.
Even punishment for those at the center of the chaos comes with a gold lining.
When the government took over collapsed mortgage giants Fannie Mae and
Freddie Mac, ousted bosses Daniel Mudd and Richard Syron were not
allowed 12.59 million dollars worth in severance payments.
Yet they still got out the door with 9.43 million dollars in retirement benefits.
Public anger at such figures underlies skepticism about the entire government rescue.
"We'll never see that money again," said Mathew May, a 24-year-old
economics student attending a small demonstration near the New York
Stock Exchange. "They deregulated the markets and ran wild. Now we're
bailing them out."
Arun Gupta, an editor of alternative New York newspaper The Indypendent, said there was "socialism for the rich and dog-eat-dog capitalism for the rest of us."
"Think about it," Gupta wrote in an email that quickly circulated to
thousands of activists and inspired the New York street protest. "They
said providing healthcare for nine million children, perhaps costing
six billion dollars a year, was too expensive, but there's evidently no
sum of money large enough that will sate the Wall Street pigs."
And left-wingers are not the only ones speaking out.
Newt Gingrich, the fiercely conservative former speaker in the House of
Representatives, wrote in the National Review that the bailouts, likely
to top a trillion dollars, smack of "crony capitalism."
"Doesn't that mean that we're using the taxpayers' money to hire people
to save their friends with even more taxpayer money?" he asked.
Forbes, the magazine for and about the rich, also said enough was enough.
"The compensation schemes for Wall Street CEOs should be capped to a small fixed amount," wrote national editor Robert Lenzner.
"The rest should be dependent on performance in a way that does not
reward taking greater risk than is prudent. If CEOs don't perform, they
should get nothing."
One worker in the New York finance sector, who asked not to be named, said his colleagues were as angry as the general public.
"A lot of people are very upset that managers in their own companies
and captains of industry in other areas made some really, really bad
decisions," he said.
"The most insulting thing is the golden parachutes where these jackals
from Fannie and Freddie, having destroyed the company, walked away with
millions.... It all comes down to greed."