Executive Pay Packages: We Told You So, Part 4 (Sirota)

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more: http://www.ourfuture.org/blog-entry/2008125115/executive-pay-packages-we-told-you-so-part-4

Executive Pay Packages: We Told You So, Part 4

VoiceSTAFFBy David Sirota

December 15th, 2008 - 2:08pm ET

My newspaper column this week looks at three new government reports that prove progressives were right in their criticism/predictions about the economy, and our Beltway Bailout artists were wrong - wildly wrong. But let me now add a fourth "we told you so" example to the pile - this one arguably the most frustrating of all.

Back in September when Congress was debating the bailout bill, I and others reported on the Treasury Department secretly reassuring Wall Street executives and analysts that the bill's supposedly tough executive compensation rules were written to be unenforceable.

The closest we got to traditional media coverage of this scandal was (oddly enough) Fox News on 10/1. The network noted my In These Times report, and then asked Rep. Jane Harman (D-CA) about it (she replied "I don't know if it's true, I would be surprised" and then added that if it was true, "that would obviously hurt" the bailout bill's prospects in the House). But other than that Fox News report, Democratic politicians were allowed to blanket the radio and television airwaves insisting that they had really "improved" the bill by including tough executive compensation limits.

Now, months later, we get this front-page story in the Washington Post (which is a carbon copy of a November report from Bloomberg News):

"Congress wanted to guarantee that the $700 billion financial bailout would limit the eye-popping pay of Wall Street executives, so lawmakers included a mechanism for reviewing executive compensation and penalizing firms that break the rules. But at the last minute, the Bush administration insisted on a one-sentence change to the provision, congressional aides said...The small change looks more like a giant loophole, according to lawmakers and legal experts...Lawmakers and legal experts say the change has effectively repealed the only enforcement mechanism in the law dealing with lavish pay for top executives."