Bank Execs' Proposed Salary Limits: No Sympathy Here

It might be one of the silliest stories I have read in a long time. On Friday, Allen Salkin of the New York Times wrote a piece entitled “You Try to Live on 500K in This Town” in which he argues that a family of four needs to earn around $1.6 million just to cover living expenses in New York city.

The article is aimed at criticizing the Obama administration’s proposal to limit the base salary of top executives at AIG, Bank of America (BAC), and Citigroup (C) to $500,000 per year as long as their companies are staying afloat thanks to government aid. The argument is kind of short-sighted anyway, given that the executives in question already have net worths in the tens (or even hundreds) of millions of dollars, and therefore forgoing huge salaries for a couple of years is not going to result in their lavish Manhattan apartments being foreclosed on.

Nonetheless, the idea that the very executives who are largely to blame for the financial crisis should not have to make any financial sacrifices, like the rest of the country is being forced to, is pretty ridiculous. I highly doubt the content of this article is going to win any sympathy from the vast majority of people reading it, but maybe that’s just me.

Comments

[Poor me]

Yeah, but what's next? How will you feel when they decide to limit your pay? It can all trickle down stream you know. No one should be regulating anything in the running of the private sector.

2009 Feb 11 03:29 AM

[john s. gordon]

once you have bankrupt banks running on taxpayer cash you don't have a private sector anymore.

multimillion $ salaries as reward for driving your company into the ground are an abomination.
> jack

2009 Feb 11 09:06 AM

[RSAAKS]

A comment posted asks "How will you feel when they decide to limit your pay?" Well, Mr payoff, every time our profits go down, my pay goes down. Every time my profits go up, the pay goes up. Can we apply that rule to the bankers and wall street? Would that be so unfair??

2009 Feb 11 09:50 AM

[Fabien Hug]

Very simple; if you can't live in NY with $ 500K/year, get rid of New York.

2009 Feb 11 01:18 PM

[henarl]

There has got to be a whole lot of people living in NYC on less than $500,000 a year and I'm not talking about the homeless! There is a big difference between living decently and living damned extravagantly. Why do these executives of unprofitable businesses think they are entitled to live extravagently? Too much inflated ego and not enough reality.

2009 Feb 11 01:43 PM

[jimbiker]

I bet there are lots of people in New York City who would gladly take 500k for an annual salary since it would help ease there lives there, as it would be a substantial raise. The execs who oversaw this mess should have their salaries limited. If they don't like it, they don't have to take the bailout money which is not mandatory. If the company goes out of existance, they execs salary drops to zero with no options and no job prospects either. My pay raises have all been well below inflation for years. I'm not too worried about the government trying to curb my lavish life style which is non-existent.

2009 Feb 11 11:08 PM