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Obama Appoints CEO ‘Compensation Czar’

Buried discreetly in the ‘Business’ section of the New York Times:

The Treasury building is seen in Washington, September 29, 2008.

White House Appoints Czar to Oversee Executive Pay


June 11, 2009

WASHINGTON — The Obama administration on Wednesday appointed a compensation czar who will have broad discretion to set the pay for 175 top executives at seven of the nation’s largest companies, which received hundreds of billions of dollars in federal assistance to survive.

The mandate given to the new compensation official, Kenneth R. Feinberg, a well-known Washington lawyer, reflects the federal government’s increasingly intrusive role in the corporate affairs of troubled companies. From his nondescript office in Room 1310 of the Treasury building, Mr. Feinberg will set the salaries and bonuses of some of the top executives in America, including Kenneth D. Lewis, the chief executive of Bank of America; Vikram S. Pandit, the head of Citigroup, and Fritz Henderson, the chief executive of General Motors.

The compensation of executives at some companies receiving aid provoked a firestorm of political outrage earlier this year. In revising an earlier proposal to set pay limits, the Obama administration has decided to take an approach that will leave the success or failure of the effort to curtail high compensation at the assisted companies in the hands of Mr. Feinberg. (Mr. Feinberg himself will not receive any government compensation.)

Instead of deciding compensation levels himself, the Treasury secretary, Timothy F. Geithner, decided to appoint Mr. Feinberg, a well-known mediator whose last high-profile assignment was putting a financial value on the lives of victims of the 9/11 attack, to decide the pay for the top 25 executives at the American International Group, Citibank, Chrysler, Chrysler Credit, General Motors, GMAC and Bank of America.

For 80 other financial institutions that have received federal assistance, Mr. Feinberg will develop the overall compensation structure, but without setting the exact level of pay. For these 80 companies, the goal is to reduce excessive risk-taking by executives whose compensation is tied to company performance. Mr. Feinberg will also determine whether it would be in the public interest to force any executives at companies receiving assistance who might have been overpaid to return some pay.

Mr. Feinberg became a nationally known figure after he was assigned by the Bush administration to help settle possible lawsuits by the families of victims of the terrorist attacks on Sept. 11, 2001. His job was to put a value on the lives of the victims and offer government settlements to avoid lawsuits. Mr. Feinberg met with many of the families and spoke around the country about how intellectually challenging and emotionally difficult the assignment became. He often sought refuge by cloistering himself in a room in his home to listen to his extensive opera collection.

Before that assignment, he was appointed by federal district judges to help resolve some of the most difficult product liability lawsuits. He played central roles in resolving prominent cases involving victims of asbestos, Agent Orange, and the Dalkon Shield, a birth control device that injured more than 200,000 women. He also was one of three arbitrators who determined the fair market value of the Zapruder film that captured the assassination of President John F. Kennedy, resolving a dispute between the heirs of Abraham Zapruder, who shot the footage, and the government, which acquired the 26-second film.

The announcement is the third effort by Washington to respond to public outrage over high pay at companies receiving taxpayer assistance. On Feb. 4, the Obama administration announced a proposal to set a $500,000 cap on cash compensation for the most senior executives at troubled companies getting “exceptional assistance,” and restrictions on cashing in on stock incentives.

That plan did little to quell public outrage as details of bonuses were disclosed at a number of major companies receiving federal assistance. Two weeks after the Obama plan was announced, Congress approved a $787 billion economic stimulus bill that included more restrictions on the pay of executives at institutions receiving aid. The provision, inserted by Senator Christopher J. Dodd, the Connecticut Democrat, over the objections of the Obama administration, instructed Treasury to come up with new rules for the five most senior officers and the 20 highest-paid executives at the most troubled companies.

That legislation was the basis for the appointment of Mr. Feinberg.

Mr. Dodd recommended the appointment of Mr. Feinberg to Mr. Geithner last month, a person briefed on that conversation recalled.

Another day, another Czar.

And another blow to whatever is left of freedom in this country.

Luckily, the Constitution is a ‘living document.’

This article was posted by Steve on Wednesday, June 10th, 2009. Comments are currently closed.

18 Responses to “Obama Appoints CEO ‘Compensation Czar’”

  1. Howard Roark says:

    Atlas is shrugging.

  2. MinnesotaRush says:

    “Instead of deciding compensation levels himself, the Treasury secretary, Timothy F. Geithner, decided to appoint Mr. Feinberg, a well-known mediator whose last high-profile assignment was putting a financial value on the lives of victims of the 9/11 attack”

    Oh! So not only do we have a “reported god” in o-blah-blah, now he has “sub-gods” in tax cheat geitner and the new guy, Feinberg. I wonder how much hehad to “tithe” to become a god???

  3. proreason says:

    Ok, if it’s good now, then it’s good retroactively for everyone in public office.

    Let’s start with Rahn Emmanuel….net worth $5M, all earned when he was a “director” Fannie Mae.

    He should have to repay it all.

  4. Reality Bytes says:

    It’s Official! Obama has more Czars than Russia ever had!

  5. Rusty Shackleford says:

    I worked for a major company that had to file bankruptcy in 2002 or 3. Meanwhile the CEO’s got fired and made off with a golden parachute in compensation.

    Though that left me angry, I never wanted the government to step in and dictate what a CEO, CFO or any other exec could get paid. That is for the employee groups, the shareholders and the board of directors to decide.

    Sadly, all too often the mukkity-mucks are all in bed with each other and decide on ridiculous “compensation” even if the company they were courted to come run, gets run into the ground.

    It’s part of the capitalist system that I have trouble with. Naturally, without the workforce, the company cannot produce its widgets and would go out of business. However, it goes against my grain that the higher-ups and highest-ups take the multimillion bucks and have no apparent conscience about it. Perhaps they shouldn’t. After all, it’s a legal, binding contract. That is, until little barry gets ahold of it.

    But even with my anger about such a thing, I’ll be damned if I prefer that GovCo takes over companies, dictates salaries and determines what those companies do and how they do it.

    I’d rather be angry that the CEO left with big money than to see idiots in government tell ANYONE what they think is a “fair” wage package.

    This is very damaging to our nation. It is a cherry on top of the s**t-cake we’ve been forced to eat these past 100+ days and I know…I am fully aware that they are far from done. There are 3 and a half years left and if, during the elections of 2012, they get voted out of office, the Clintonians, from the planet Absurdia and they’re taking of “W”‘s from keyboards and such when they left, is child’s play to what the Obamanites will do. Not to mention the riots and looting.

    This is not the America I wanted to live my middle-age years in. I would much rather have not had to listen to the garbage that spews from the MSM…the fact that I have always had to put up with liberal hippies from the 60’s always ahead of me by ten years, screwing up everything before I got there and also being my bosses, and my “elders”.

    Their numbers have always worried me. I hated being a kid in the 60’s when they hung out and were protesting against Vietnam. I thought they looked rpetty stupid. Imagine, just imagine, if the whole nation had stood behind the government and wanted victory in Vietnam?

    Now these same long-haired, hippy-type pinko fags run the government. (Sorry Charlie Daniels, I had to say it)

    I knew it when I was seven…I still know it now. The generation that is ahead of me, with certain exceptions, largely has no clue, nor have they ever, about how things work. Not the slightest inkling of the mechanisms of why it hurts sometimes to be a good parent, why the tough decisions have to be agonized over, why it’s bloody HARD to be an adult sometimes.

    Instead we gradually got words like “Phys Ed” instead of “Gym Class”, “Rain Forest” instead of “Jungle” (Hell, EVERY forest is a “rain” forest), “underprivileged” instead of “poor”, and all the rest of the politically correct crapola that has slowly but steadily permeated our existence.

    All the while, leaving behind one word they learned to hate with a passion—-


    They have none.

    • JohnMG says:

      Hey, Rusty, you’re painting a lot of us here with a pretty broad brush. In case you hadn’t noticed, it’s pretty hard to prevail when you’re outnumbered 2 to 1. If you’re ten years behind me (and you’re probably a few more than that) imagine what I feel like. I’ve just had that many more years of eating the ‘sh*t sandwich’ than you have. And I’m not any more happy about it than are you. Maybe I was too busy with a shooting war to be politically active at the time.

    • Rusty Shackleford says:

      John, Apologies if you understood it that way.

      I did put a qualifier in there “with certain exceptions” and obviously (or perhpas not) YOU and people like you are in the exceptions category. You’re right, you were and are outnumbered two to one and my generation seemed to follow and even expand on that trend of the “touchy-feely” BS that has now permeated our society instead of a realisitc, pragmatic approach to things.

      I intended no slight to your peers, dis-inclusive of those hippy-types. You and people like you who were raised in the sense of personal responsibility, service to country, etc are to be praised, regularly and loudly. Indeed while on active duty, I always listened carefully to the long-term vets in the crowd.

      My own “peer-group” such as it is, and I noticed this very much while growing up, is very keyed in on the “feel-good” way of doing things. Emotionally driven and lacking in technical awareness. Not to say that there aren’t conservatives in my age group but it IS a slowly (rapidly?)fading condition.

      I do feel bad that I came off a little broadsided there. I actually thought about that after I posted and had planned an edit.

      So please don’t think for one minute I include the conservative thinkers of your generation with that. My angst is with those who are the hippies of yesteryear, longing for that “vision” and “revolution” that they so longed for and now, doing everything they can to make it happen while at the same time, continuing with their lack of technical ability, tunnel-vision, selfish and Utopian dream (nightmare) that will only serve to further divide this nation, create some deeply dangerous conditions and ruin it for those who have played by the rules their whole lives.

      I am deeply regretful that I insinuated that all of your generation are that way. But as you pointed out, 2 to 1 and they represent a majority and that’s who I’m so severely disappointed with.

      John, your posts are often the ones I read over, nod my head and say, “I agree”. Thanks for pointing out my faux pas.


    • JohnMG says:

      No apologies necessary, Rusty. I know that feeling of frustration, such to the point I just want to scream. Actually I liked your rant for you said much of what I feel toward those of my own generation who began this rot. And you’re right–each succeeding generation pushes the envelope a little harder. I only hope I’m still around when the day of reckoning comes, ’cause I’d like my chance to set things right.

      Anyway, I’m sure we both feel better now. ;-}

  6. wardmama4 says:

    I keep waiting to find out just which is the one that is going to get people to stand up and scream not No but Hell, NO and it just doesn’t seem to be there, yet.

    I do hear rumblings from the NRA most especially since The One ™ Thug Administration is so anti-gun. Now I hear that the AMA is against the Kennedy Free(wink, wink) Healthcare for all, Illegals First Bill.

    The only thing is that I know the end of the book – I’ve read it – GOOD WINS – doesn’t matter if you are reading the Bible or a secular book. The end is always the same. And I know that the times are going to be hard until the masses wake up and give a damn – or evil obliterates most of the World and it all begins again (there is a reason someone smart said – those who do not study history are doomed to repeat it). And I know me & mine can survive it – heck I even have a book – Knitting with Dog Hair – I can get through if I need to.

    My point though is that America is the greatest concept, nation, culture, political system, government and country in the history of the World – so why in the he** should we have to go through Nazi Germany, Castro Cuba, British malaise, Pol Pot killing fields, or such human waste of time, productivity, creativity, and life?

    It is just so damn stupid and I wish that someone, anyone could get people to wake up and start fighting back.

  7. retire05 says:

    Let’s see; how many czars do we have now? I think the number is around 16. Sixteen government officials, not elected or selected by the American people, who have control over agencies that affect each and everyone of us and our daily lives. It goes back to my toilet theory: remember when the government mandated that toilets could no longer us the standard 6 gallons of water but had to be reduced to 1.6 gallons? That worked out well. Most of these toilets have to be flushed more than once to acheive the job the 6 gallon type did. And why? Are our rivers drying up? Al Gore tells us the sea levels are rising. So why the rule?

    Simply put: control. Control over what you eat, consume, use, drive, wear. Banish fat foods, banish gas guzzling cars that are fun to drive, banish anything that just may not agree with the statists running our government.

    Welcome to the United Socialist States of America, kids.

    • BatK says:

      I thought they were going to call it Obamastan….

      Socialism is not about “everyone being equal”…it’s about the power hungry elite who think they have a right to rule over “the masses” … the idea of everybody being “equal” is just a way to dupe people into giving up their rights… and it’s scary that you have 16 (and counting) people operating in a capacity nowhere found in our consitution and accountable only to the President… sounds more like a monarchy to me (at best) and an eventual thug state with czars/gestapo, etc to “enforce” whatever the heck THEY deem necessary

  8. U NO HOO says:

    We’re getting Tsarred and Feathered.

  9. wardmama4 says:

    Has anyone caught the irony of Public Servants – who vote their own pay/raises/benefits demanding to cap the pay/benefits of private enterprises?

    Enron failed – horribly in a cloud of deceit, deception and horrible corporate management – lots of people lost their jobs, their money, their retirement, trials were held and people went to jail, died etc – but America and her economy did not come to a screeching halt and oh yes, let us not forget that the Dems in Congress were cheerleading the whole mess all the way

    But now all of a sudden – every thing that the Dems want/promote/protect is failing also – and the American taxpayer has to take the hit to keep them alive. Might it be – because if there were trials in these cases – we’d see the dirty little grubby fingers of dirty little Dem politicians who have created this mess out of lies, corruption and schemes – meant to do exactly what it’s doing – bring America down to a 3rd World level of the political tyrants running the show and the rest of the people in poverty and subjugation?

    Now these liar, thieves and corruptocrats are going to attack smoking while shoving through the most massive and insane Kennedy Free (wink, wink) Healthcare for All, Illegals First bill. And then simply by fiat – make every single person in this country a citizen – without penalty, review and a single care in the World.

    Meanwhile, everyone who is employed in a real job will watch their lives go up in smoke, their taxes approach 75% and their freedoms and rights go by the wayside.

    And oh btw – the Klownposse in DC voted in their own retirement benefit system and their own healthcare system – which they get for life and you and I who pay for it – didn’t get a voice, didn’t get a choice (or I guess I shall say, coming this summer our choices are going to be taken away from us).

    And I wonder how The One ™ can stand the hypocrisy of being a committed smoker and watching the Klownposse in DC – attempt to take down the tobacco industry.

    Once again – Hypocrisy thy name is Democrat. And they are no longer Public Servants but rather have become Public Scammers.

    And oh yeah – President Obama – I am not a citizen of the World – I AM AN AMERICAN CITIZEN

    God Help America.

    • JohnMG says:

      …..”I am not a citizen of the World – I AM AN AMERICAN CITIZEN…..”

      Well said, wardmama4. And as far as I’m concerned, the “citizens of the world” can kiss this American, veteran, white man’s lilly-white butt!

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