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Dan Burton Sympathizes With AIG and Citi CEOs, Thinks They’re Underpaid

Here’s a fun video clip from Watermelon Dan Burton that gives you a pretty good insight into what Republicans think about the financial industry executives who brought our economy to its knees. In a word, they think they’re underpaid.

I obtained this clip from a House Oversight and Government Affairs Committee hearing yesterday on White House official Kenneth Feinberg’s slashing of executive compensation for the seven largest bailed-out companies. Remember, these companies have taken billions in taxpayer dollars and essentially exist now as wards of the state, with the US taxpayer acting as the major shareholder. But to Dan Burton (R-IN), simply to think of holding the top-level executives accountable for their pathetic performance managing their companies is just verboten. Here’s an actual question he posed to Ken Feinberg:

And you said that you had some people that were making, what, $13 million dollars, and you cut them down to $350,000 or something like that? Why would anybody in their right mind, if they’re an executive for a company like that, who has the talent to manage and run a company, why would they take a pay cut from $13 million down to $350,000, and does that damage the company?

Yes, the executives at AIG and Bank of America and Citi sure have lots of “talent,” don’t they? So much talent that they nearly bankrupted the federal Treasury and took down the global economy. So those executives are right to be horribly offended, at least according to Dan Burton, at seeing their pay drop to a measly $350,000 a year. Seriously, I don’t know how they can feed their families or gas up their 30-foot sailing yacht on that kind of scratch.

(Of course, the $350,000 covers base pay. These executives can still be rewarded by stock options that could go into the millions of dollars. But Dan Burton’s sympathies lie with the poor henpecked CEOs rather than the millions of Americans out of work due to their management decisions.)

That’s the Republican theory on executive compensation. Some Democrats, at least, think Feinberg isn’t going far enough. Here’s Rep. Judy Chu (D-CA), who released a statement today:

The economic downturn has hit my district hard. California has the nation’s highest total of foreclosure filings for the first half of 2009 and unemployment in LA County has hit 12.7%. Yet for the past year, we have read in the news how well CEOs and bank executives are fairing in terms of salary and compensation packages, all on the backs of hardworking taxpayers. This is not only troublesome, but goes against the trust of the American people […]

While I am relieved to hear that Mr. Feinberg is working diligently to hold these 7 TARP corporations responsible, we need more stringent enforcement mechanisms to rein in executive compensation. We have no guarantee that once these companies are nursed back to health, they won’t return to the exorbitant and risky pay structures of the past, which we know significantly contributed to the financial meltdown. In fact, Goldman Sachs, JP Morgan Chase, and Morgan Stanley have since paid off their government loans and plan to make huge payments to their executives this year. We need to continue to hold them accountable in the long run.

But that would be grossly unfair to those talented banksters. Just ask Dan Burton.

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David Dayen

David Dayen

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