THIS IS WHAT I'M TALKING ABOUT ...

A week ago I posted the following: Let's RETROACTIVELY tax bonuses of executives who ran their companies into the ground and then asked for and received TARP aid. I was thinking we could tax the more than $18 billion in bonuses at a 90% rate, or something like that. Even my liberal colleagues here at the university thought I was nuts.

Then we got Sen. Claire McCaskill's call to limit CEO compensation. I became a happy camper. Now that I've (finally) read the specifics of Senate Bill 360 I'm an even happier camper.

Specifically, these are the parts I like:

(a) ... no person who is an officer, director, executive ... may receive annual compensation in excess of the amount of compensation paid to the President of the United States.

(b) Duration- The limitation [of CEO pay & bonuses] in subsection (a) shall be a condition of the receipt of assistance under the TARP, and of any modification to such assistance that was received on or before the date of enactment of this Act ...

In plain English, this says that the executives who received big bucks after TARP was enacted can keep $400,000 (what we pay the president) but will have to pay the rest of it back.

And I thought my 90% clawback tax proposal was far fetched. Go get 'em Claire McCaskill.

Maybe we'll finally bring some semblance of market reward back to the system, and save America in the process. And no, I'm not being overly dramatic with my last comment. Our system of compensation and reward is so out of whack that the moral justification of capitalism is in peril.

Like I said, SB 360 makes me a happy camper.


- Mark