Are you capable of taking a perfectly good 158-year-old company and turning it into dust? If so, then you may not be earning up to your full potential.
You should be raking it in like Richard Fuld, the longtime chief of Lehman Brothers. He took home nearly half-a-billion dollars in total compensation between 1993 and 2007.
Last year, Mr. Fuld earned about $45 million, according to the calculations of Equilar, an executive pay research company. That amounts to roughly $17,000 an hour to obliterate a firm. If you’re willing to drive a company into the ground for less, apply by calling Lehman Brothers at (212) 526-7000.
Oh, nevermind.
I’m delighted to announce that Mr. Fuld (who continues to lead Lehman since it entered bankruptcy proceedings this week) is the winner of my annual Michael Eisner Award for corporate rapacity and poor corporate governance. The award honors the pioneering achievements in this field of Mr. Eisner, the former Walt Disney chief.
Well, the guy ran the show there for 14 years before it imploded, so it would be interesting to see what was done differently that caused the collapse. Did Fuld suddenly sprout horns and a tail, or did he and his underlings instead rely on shabby information from, say, certain government-sponsored entities?
What about the Freddie and Fannie bosses?
Don’t you notice the absolute quiet when it comes to those who drove them into the ground and probably raped them as well?
I wonder why…..
Don
I don’t know about absolute quiet, DonGander. They were fired, and rightly so, unlike Fuld.
They were given lovely severance packages and quickly found work as policy advisors on a certain campaign’s staff.
And poor old Fuld will be flipping burgers at MickyD’s after the bankruptcy. Having been mislead by the government and all.
No, he’s probably going to retire. I hope he’s not sought out for advice like those other guys.
It is pretty shocking to see these financial titans, which survived the civil war, two World Wars, the Great Depression…, fall. I’ve not been able to read much since I’m currently traveling in a remote part of Africa, but I’m definitely sobered by these recent events.
“Government sponsored entities?” What are you talking about? These banks were like kids at a cookie jar. This implodes the myth of people regulating themselves.
Both Dems and Republicans weren’t that interested in regulation. They bought into the idea that people aren’t greedy.
Jefferson avoids the question: was this man worth $17,000 and hour? For letting a company be destroyed? By what standard?
#4 I may be mistaken, but my information was that there were no severance packages for the two former CEO’s as a condition of the bailout. I’d appreciate correction if that is in error. Would you also clarify whether they are in fact policy advisors to a candidate, and if so to whom?
#8: Fannie and Freddie are, or were, [url=http://www.hud.gov/offices/hsg/gse/gse.cfm]government-sponsored entities (GSE’s)[/url]. As such, the rules they operated under were quite different from that of private entities, including reduced oversight and lower reserve requirements. What F&F;did was something no bank could have gotten away with. Efforts to rein them in were fended off by congressional Democrats like Chris Dodd, Barney Frank and Barack Obama.
Was the guy worth $17,000/hr? Apparently he was for 13 or 14 years. I find it hard to justify, but I’m not a Lehman shareholder so it’s not my business to say if he was worth it.
The correct term is Government Sponsored Enterprises. Fannie Mae and Freddie Mac are examples of such enterprises.
In 2006, Sen. John McCain sponsored the Federal Housing Enterprise Regulatory Reform Act, warning of dire consequences if these enterprises were not reformed: “If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole” (source).
The legislation was killed in committee by Sen. Chris Dodd, who is the #1 recipient of campaign contributions from Fannie and Freddie. #2 is the junior senator from Illinois.
Although it’s easy to say that Fannie and Freddie should have been better regulated, to lay the blame at the feet of the Democrats is to be quite naive. Wall street and plenty of bankers enjoyed privatizing the profit while socializing the risk.
“Was the guy worth $17,000 an hour?”
Um. here’s a non-relativistic answer. He wasn’t. He failed. By any objective standard. After a while, we have to name greed for what it is. A proper government response? Tax him.
#9, I was speaking of James Johnson and Franklin Raines, not the last guy at Fannie Mae. I apparently was in error about James Johnson, who left FM in 1999 to be a Democratic political operative. He did not receive a severance package, but did understate his compensation by a factor of three, [url=http://corner.nationalreview.com/post/?q=NWM3MDFkM2QwNzRjODk3NWZhZTc3OGIxNDQ4Nzc2NDc=]$21 million as opposed to $7 million[/url]. He was slated to head up Obama’s Veep search until Countrywide Mortgage, which he headed, imploded under his tenure.
Franklin Raines, who took over for Johnson at Fannie Mae, left the company under an ethical cloud during which earnings were deliberately overstated by $10 billion so as to pad the compensation of executives like Mr. Raines, was granted a [url=http://www.1loansusa.com/realestatenews/11_15_06/news9952.html]$2.6 million severance[/url] after demanding a $19 million one. He is, or was until the fecal matter hit the ventilator, an advisor to Obama on [url=http://www.politico.com/blogs/bensmith/0708/Advice_from_Raines.html]mortgage and housing matters.[/url]
[blockquote] Um. here’s a non-relativistic answer. He wasn’t. He failed. By any objective standard. After a while, we have to name greed for what it is. A proper government response? Tax him. [/blockquote]
LOL…the liberals’ procrustean bed: Taxation.
Did he fail the first 14 years of his tenure, John? If not, do we still tax him?
[url=http://www.youtube.com/watch?v=usvG-s_Ssb0&eurl=http://ace.mu.nu/archives/273689.php]The Conscience of Fannie Mae[/url]
Jefferson,
fun to beat up on FAnnie Mae. But there are plenty of people who are to blame for that one. The best you can muster is that the Dems were involved as well. OK. I’m sure some excellent people wanted it regulated, but… I don’t think wall street would have liked that very much. Perhaps if you do a little digging you’ll find some Republicans involved. To me, it smells like a trade off. Dems get Fannie, Wall street gets deregulation. Combined, its a disaster.
It’s all hypothetical now isn’t it? In a war, it doesn’t matter if its going well, until you win or lose. He lost.
Perhaps if he had decided to resign, he might not have. As it is, he made a series of mistakes. Perhaps if he had been taxed – or at least if someone had been regulating him – he might have not been making decisions that cost the death of the company.
Taxes are disincentives. You still don’t answer the question: is someone worth $17,000 an hour? And all those guys who racked up great bonuses for fraudulently applying for loans, why are they going scott-free? They’re getting bailed out.
Best if they pay for their fraud. Why not through taxes?
#13: Thanks for the clarification.
[blockquote]fun to beat up on FAnnie Mae. But there are plenty of people who are to blame for that one. The best you can muster is that the Dems were involved as well. OK. I’m sure some excellent people wanted it regulated, but… I don’t think wall street would have liked that very much. Perhaps if you do a little digging you’ll find some Republicans involved. To me, it smells like a trade off. Dems get Fannie, Wall street gets deregulation. Combined, its a disaster. [/blockquote]
Some Democrats were involved….[i]as well[/i]??????? Talk about pegging the spin tach. In case it’s escaped your gimlet-eyed gaze, John, it’s been wall-to-wall DNC at Fannie and Freddie, Democrats who have lined their pockets handsomely and who have greased a lot of Democrat palms in Congress, too. Fannie and Freddie were of, by and for the Democratic Party. And as for Wall Street, let’s just ask [url=http://online.wsj.com/article/SB121677050160675397.html]The Wall Street Journal[/url] what they thought, shall we? (You remember Angelo Mozillo, no? Of the “[url=http://online.wsj.com/article/SB121279970984353933.html]Friends of Angelo?[/url]”
It’s clear that Mr. Fuld relied on representations from Fannie and Freddie as to the weighted risk of the derivatives he was buying. Given the donation pattern at Lehman and Fan/Fred, it’s possible one hand was washing the other here, but more likely Lehman was defrauded by the honchos at the GSEs.
While you’re crafting your fantasies about taxing investment houses into prosperity, can you also devise some way to put the likes of Franklin Delano Raines, James Johnson, Jamie Gorelick in prison for fraud? I’d even be willing to wait until they weren’t needed on Obama’s campaign any longer.
BTW, anyone wanting an excellent primer on what Fannie and Freddie are and how we got here (roughly) can watch [url=http://bloggingheads.tv/diavlogs/14410?in=00:02:55&out=00:12:56]this excellent clip from Bloggingheads TV[/url]
Jefferson, so you think that only Democrats wanted deregulation? If you think I think Dems aren’t accountable, you mistake me for a partisan hack. Not at all. Under Clinton, the Dems bought the deregulation Kool-aid.
But its interesting to me how you center on Fannie Mae, trying to excuse the Republicans – or corporate executives themselves -from bad behavior. It fits in the the “government bad business good” slogan. Plainly, businesses benefited from government involvement, and they willingly took advantage of government generosity.
It’s the cookie jar, Jefferson. Businesses liked to take from the cookie jar. Don’t tell me that deregulation had nothing to do with it.
Remember human sin?
I wish it were that… easy. P
I think Congressional Democrats wanted deregulation of Fannie and Freddie. The record clearly shows they rabidly went after any and all that tried to even bring them up to a level playing field with other lenders, regulation-wise (and the “deregulation” happened in 1968, when Fannie was cut loose from the government because LBJ didn’t want its debt showing up on the US’s balance sheet). It also shows it was used as a piggy bank for Democratic rainmakers and Congressmen themselves. The epitome of the “public/private partnership” so cherished among the [i]bien pensants[/i] these days. Were there Republicans that went along with this fleecing? I’m certain there were. But the captains of this pirate ship are from the port side of the vessel.
Will businessmen stick their snouts in the government trough, given the chance? You bet they will. All the more reason to keep the trough small enough so they can’t. But $3 trillion a year is going to attract a lot of piggies, John, and you’d be wise to remember the axiom that when things are bought and sold through legislation, the first thing bought and sold is the legislator. QED.