It is outrageous, though not surprising, to learn from the special inspector general for the nation’s corporate bailout program that the Treasury Department failed to protect taxpayers as it approved lavish compensation packages for executives of the firms receiving handouts.
We now know that in 2012, the Department approved compensation of $3 million or more for more than half of the sixty-nine executives at three firms receiving federal funds, and that sixteen garnered at least $5 million. $10.5 million in cash and stock went to the head of AIG, $9.5 million to the CEO of Ally Financial, and $9 million to the chief of General Motors. (I am sure the stockholders and bondholders that were wiped out when General Motors was permitted to erase its liabilities and be reconstituted are thrilled at the vast wealth showered upon leaders of “The New” GM).
Congress and the president had expressed the intent to cap salaries at a “mere” $500,000 for executives of the companies receiving the most aid, but apparently no one was “minding the store” at the Treasury Department and there was no oversight from any other branch of government. When the rich get even richer courtesy of government aid, the seeds are sown for future upheaval and social unrest. The American people have every right to be enraged.