Obama vs. the powerful forces
By Ben Pershing
In his 2000 campaign, Al Gore famously railed against "powerful forces and powerful interests [that] stand in your way." President Obama may not be quite the populist Gore was, but his administration's current frontal assaults on Wall Street and the health-insurance industry make clear that Obama sees similar political value in an "us vs. them" argument.
The Obama administration's "pay czar," Kenneth Feinberg, is earning his own pay, putting out word that he will cut the compensation packages of "25 of the most highly paid executives at each of five major financial companies and two automakers," the Washington Post writes. The broad politics of this issue appear to be in the White House's favor. (On CNN Thursday morning, the story began: "It's payback time for fatcats.") Team Obama believes the new rules will send a message to firms that taking the bailout money means they need to change their culture. Critics argue that the pay cuts will have the perverse effect of making the weakest financial firms even weaker, as the most-qualified Wall Street executives will flee for more successful companies that won't be operating under any salary restrictions.
The Wall Street Journal reports, "An executive at one of the seven companies under Mr. Feinberg's authority said the terms came as a shock, especially because they changed so suddenly. The compensation restrictions 'were clearly much worse than what had been anticipated.'" Politico says the administration "is making a frontal assault on Wall Street's gold-plated compensation culture at a time of growing public anger over the firms' massive pay and bonuses," and notes that the decision comes just as the White House is pushing back against industry lobbying on the regulatory reform package currently moving through Congress.
Posted at 8:28 AM ET on Oct 22, 2009
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