There is a double-standard in Washington, apparently, one for those who face Senate confirmation and one for those that don't. Remember Tom Daschle? Now read this story from today's New York Times about the millions Larry Summers received in speaking fees from the financial industry and tell me what the difference is (and why this story wasn't on the front page of the hard-copy paper; it made the homepage of the Web site.).
Then there's this story from today's Washington Post detailing Obama administration plans to end run Congress's limits on executive pay. What do these two stories have in common? Maybe the auto industry's bondholders should have had Summers over to speak more. Union, too.
Finally, you may have missed this yesterday, but it's worth catching now: the chief of the Federal Housing Finance Agency's rationalization of the need for retention bonuses at troubled Fannie Mae and Freddie Mac. It's similar to the rationale for AIG paying bonuses; if we don't bump their salaries, they'll leave. To go where, exactly? Maybe those demoralized people could desert Fannie Mae and Freddie Mac to take new jobs at AIG or Bank of America after the demoralized people there have moved on. And vice versa. Are the skill sets really so different and the organizations so poorly organized that new people can't handle the tasks?
Here's what Sen. Grassley (R-Iowa) had to say on the subject: “It’s hard to see any common sense in management decisions that award hundreds of millions in bonuses when their organizations lost more than $100 billion in a year. And, it’s an insult that the bonuses were made with an infusion of cash from taxpayers. The elite in Washington and New York need to realize that bonuses for poor performance and at taxpayer expense do a lot of damage to public confidence and support for the economic recovery effort.”