Congress May Limit Executive Pay and JetsBy
The Senate voted 52-42 yesterday to allow the Treasury Department to get the second half of the $700 billion Troubled Asset Relief Program going.
President-elect Obama has said he’ll use $50 billion to $100 billion of the remaining $350 billion to help prevent home foreclosures. He’s also said he’ll put tougher conditions on the companies receiving the funds.
Among the restrictions still being debated is limits on executive pay and other corporate perks. Rep. Barney Frank has proposed eliminating bonuses for the top 25 execs and banning corporate jets at companies that receive bailout funds.
Of course companies can easily find ways around such restrictions. They can hike base salaries, for one. A new report by the Institute for Policy Studies suggests capping total executive compensation at 25 times that of the lowest-paid employee. That is coincidentally exactly how future President Obama’s $400,000 salary compares with the lowest-paid federal worker.
The report notes that crafty companies are already getting around the proposed corporate jet ownership restrictions by chartering private aircraft.
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