February 13, 2009

through the looking glass

As if we taxpayers haven’t been scammed enough by Wall Street, Citigroup’s chief executive, Vikram Pandit, decided to take us all for another ride.

Testifying before the House Financial Services Committee on Wednesday, Pandit declared — repeatedly — that he had asked the bank’s board to reduce his salary to $1 a year until Citi returns to profitability.

Facing public outrage over runaway pay in a year when Wall Street plunged the global economy into one of the most profound financial crises ever, Pandit portrayed it as an act of contrition.

The dollar-a-year CEO has always been a compensation stunt, one that we’ve seen most notably from Apple’s Steve Jobs. In Pandit’s case, tossed out before Congress as some sort of good will gesture, it’s downright insulting.

“When somebody tells you they’re working for a dollar, grab your wallet,” said Joe Birkofer, president of Houston-based Legacy Asset Management, who teaches a course in executive pay and benefits for Rice University’s certified financial planner program.

I recommend the whole of Loren Steffy's column. These CEOs employ a logic Alice's friends could approve.

"And if you take one from three hundred and sixty-five what remains?"

"Three hundred and sixty-four, of course."

Humpty Dumpty looked doubtful, "I'd rather see that done on paper," he said.

And of course there is this:

"Please do not call it a bonus. It is not a bonus. It is an award. And it recognizes the importance of keeping our team in place as we go through this integration."
-- James Gorman, co-president of Morgan Stanley, during an internal conference call

1 comment:

  1. and after all this there are many, many republican voices who are still claiming that regulation is not necessary. they go a step further and are blaming the democrats going all the way back to carter saying that their policies or goals to get affordable housing for everyone caused the banks to come up with exotic mortagages and place bets 1-30 in who know what.
    here's some of their comments:
    "The biggest misrepresentation is that this is Bush's mess. Look deeper and you will find a liberal worldview at the heart of all of this."

    "From what I understand a great deal of the problem goes back to the Carter administration when banks were told to accept mortgage borrowers even if they couldn't pay back their loans because everyone should have their own home- whether they can afford it or not."