Thursday, June 11, 2009

War On Capitalism Continues, Democrats Want to Push Administration on US Corporate Pay Strategies

They want to set compensation terms on company's taking Federal TARP money; I'm fine with that. You eat the government cheese, you play by their rules. But capping salaries on private companies?

This is getting ridiculous! This is socialism in action folks! Redistribution of wealth in action! The Liberal assault on free-market capitalism I have been warning you about for months!

Americans should be outraged at the socialism of Obama and the Liberals in Congress.

The Associated Press:

WASHINGTON (AP) -- The Obama administration is taking a half-step toward taming U.S. executive pay. Some lawmakers prefer a fuller stride.

Democrats on the House Financial Services Committee said Thursday the administration's efforts to hector the private sector into reining in executive pay might not go far enough.

The administration contends that excessive compensation contributed to the U.S. financial crisis, but rejects direct intervention in corporate pay decisions.

Instead, the administration plans to seek legislation that would try to rein in compensation at publicly traded companies through nonbinding shareholder votes and less management influence on pay decisions.

"I do differ with the administration in that hope springs eternal and their position seems to be that if we strengthen the compensation committees we will do better," said the committee chairman, Rep. Barney Frank, a Democrat.

Rep. Brad Sherman, a Democrat, said that instead of giving shareholders a nonbinding voice on pay, their votes should be binding on boards of directors.

Democrats and administration officials agreed that companies across the private sector need to adjust compensation practices to avoid damaging the economy.

Gene Sperling, a counselor to Treasury Secretary Timothy Geithner, said administration guidelines call on all publicly held companies to link compensation to long-term performance, not short-term gains.

"We believe that compensation practices must be better aligned with long-term value and prudent risk management at all firms, and not just for the financial services industry," Sperling said.

The committee also heard from officials from the Federal Reserve and the Securities and Exchange Commission.

While the administration has approached the issue with caution, a top Republican said the plans amounted to "incessant government intervention."

"The president cannot continue his heavy-handed meddling in the private sector and expect it to function, much less flourish," said Rep. Tom Price, chairman of the Republican Study Committee.

Alabama Rep. Spencer Bachus, the top Republican on the committee, added: "We need to get government out of businesses."

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