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The secret bank bailout

Posted at 8:46 AM on December 22, 2008 by Bob Collins (5 Comments)
Filed under: Economy

The Associated Press is out with a survey that says banks that are getting taxpayer bailouts gave their bosses $1.6 billion in salaries, bonuses, and other benefits last year. $1.6 billion. That was once considered a lot of money.

Even where banks cut back on pay, some executives were left with seven- or eight-figure compensation that most people can only dream about. Richard D. Fairbank, the chairman of Capital One Financial Corp., took a $1 million hit in compensation after his company had a disappointing year, but still got $17 million in stock options. The McLean, Va.-based company received $3.56 billion in bailout money on Nov. 14.

John A. Thain, chief executive officer of Merrill Lynch, topped all corporate bank bosses with $83 million in earnings last year. Thain, a former chief operating officer for Goldman Sachs, took the reins of the company in December 2007, avoiding the blame for a year in which Merrill lost $7.8 billion. Since he began work late in the year, he earned $57,692 in salary, a $15 million signing bonus and an additional $68 million in stock options.

Meanwhile, another AP story today says the banks won't say how they're spending the money.

Comments (5)

Unbelievable.

Posted by Bonnie | December 22, 2008 9:29 AM

is that $68M in options before or after the crash? How on earth is he going to ever feed his family?

Posted by BJ | December 22, 2008 12:22 PM

Several commentators over at counterpunch.org predicted this result. This is what happens when you let a bunch of Wall Street guys who didn't see this coming design a bailout. It isn't necessarily that they're corrupt, but it's who they are. They just don't think in terms of oversight, they're faith based economists at heart, they still tend to assume that they can more or less tick markets into doing what they want with incentives rather than directives. Oddly enough they underestimate the power of greed. Of course that's the generous interpretation, the cynical interpretation is that they are good ol boys passing out goodies that they can cash in on when they go back to the private sector.

Posted by Paul | December 22, 2008 12:30 PM

Oh, I think being corrupt IS who they are! Why make excuses for them?

Posted by Katie Z | December 23, 2008 11:17 AM

The fabric of our business culture is rotted. How can anyone believe that they can buy a mansion on Park Avenue when it is the hardworking people of this country who have bailed out his company????!!!!

Posted by liz | December 31, 2008 8:51 AM

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