No doubt you will be as pleased as I was to learn that the Securities and Exchange Commission is cracking down on those unconscionable pay packages that Wall Street elites keep grabbing.
By a 3-2 vote, SEC commissioners socked the money-grubbing bankers with a new “say on pay” rule. Rather than let top executives lavish money on themselves unchecked, the new rule lets shareholders of those financial giants vote on extravagant salaries, bonuses, and perks. That’ll rein in the excess, right?
Enjoying Hightower's work? Join us over at our new home on Substack:
Probably not. You see, the SEC has long been a gentle regulator, never wanting to hear a Wall Streeter say “ouch.” Thus, the say-on-pay rule has no bite. Shareholders can indeed have their say, but it’s a non-binding vote! Bank big shots can simply ignore it. Yet, even this velvet harness was too rough for the two, soft-on-greed Republican commissioners, Kathleen Casey and Troy Paredes. Both voted no, with Casey explaining that the new rules “are unduly restrictive and impose unnecessary burdens” on bankers.
Don’t despair though, for justice still might be served. The SEC has since approved another compensation crackdown, this time specifically targeting outrageous, multimillion-dollar bonuses. For the first time, big banks will henceforth be compelled to restrain themselves. How? By filing detailed annual reports about the bonuses they pay. Ouch, that’ll sting, won’t it?
Again, though, even this tiny pinch was too harsh for the compassionate Republican members. Both sided with the poor bankers, wailing that requiring reports is a big-government intrusion into the private sector, overreaching the SEC’s authority.
Luckily, a public interest group named Bankster USA is rallying grassroots support to curb banker greed. To have your own say and push for real reform, contact www.banksterusa.org.
“In Split Vote, S.E.C. Adopts Rules on Corporate Pay,” The New York Times, January 26, 2011.
“S.E.C. Plans Crackdown On Bonuses,” The New York Times, March 3, 2011.
Special rate for original Lowdown readers