Kenneth Feinberg, named by the current administration as special master of executive compensation of firms receiving TARP money, has decided to substantially increase regular salaries at the finance and auto companies under his control.
According to the WSJ, Mr. Feinberg, who oversees seven firms that accepted bailout packages — including international insurer (AIG), Citigroup (C), and Bank of America (BAC) — has boosted base salaries for the bulk of employees working for these firms, in some cases by hundreds of thousands of dollars.
On average, base salaries climbed to $437,896 a year, compared with $383,409 previously, a 14% increase, according to a Journal analysis of Treasury data. Of the 136 employees under Mr. Feinberg’s review, 89 saw their base salaries increase.
At Citigroup, which is 34%-owned by the U.S. government, Mr. Feinberg agreed to more than double salaries for 13 of the 21 employees, the Journal said.
Officials with some of the companies confirm they urged Feinberg to boost base salaries, complaining that his proposed restrictions would deprive their employees of needed cash. Others said they wanted higher base salaries to prevent key employees from leaving.
See how math works at Citigroup:
Obviously, the people making these decisions are from the same piazza and same country clubs as the overpriced incompetents they’re bailing out. These people think they are entitled to make obscene amounts of money. They think they are entitled to the corporate welfare. And why shouldn’t they. After all, the government, with its massive subsidization of Wall Street, has sent a clear message that taxpayer money will be there pronto and will cover private losses if you happen to be in the right circle of powerbrokers. They are making sure no deflation affects the salaries of these imbeciles.
When the historians finally finish sorting through the appalling decisions that have been made during the contemporary crisis, this one will probably be at the top of the list. Having said that, it makes you wonder if these Washington academics ever take into account the long established converse effects of their actions.