CT Progressive

Joe from the WFP directed my attention to the Maximum Wage Bill, HB 5077, which is being offered in the Connecticut State Legislature this year by Rep. Aresimowicz. The bill’s draft reads:

Be it enacted by the Senate and House of Representatives in General Assembly convened:

That the general statutes be amended to provide that eligibility for state economic assistance and tax expenditures for corporations be denied to such corporations whose chief executive officer earns more than twenty times the wage earned by such corporation’s lowest paid employee.

When I first heard about it, I smiled, and thought that a) it was an idea that wasn’t likely to go anywhere, and b) in particular would make executives seek out demotions to the vice-presidential position in their companies in a hurry.

But it seems like there may actually be some action on this front coming down on the Federal level. From Bloomberg:

White House spokesman Robert Gibbs said it’s “very safe” to assume that new rules guiding the administration’s financial rescue will address bonuses and executive pay.

Earlier today, Senate Democrats took the first step toward limiting pay for workers at companies receiving federal bailouts. Senator Claire McCaskill of Missouri introduced legislation to restrict compensation at such companies to $400,000, the equivalent of the U.S. president’s salary. Another measure being proposed would create a court to restrain executive compensation.

“We have a bunch of idiots on Wall Street that are kicking sand in the face of the American taxpayer” by taking multimillion-dollar bonuses, McCaskill said.

Companies have continued to award bonuses after accepting funds from the $700 billion taxpayer bailout enacted by Congress last year. The Treasury Department has injected about $200 billion into banks across the country through its Troubled Asset Relief Program. [...]

McCaskill’s Cap Executive Officer Pay Act would ban any director, executive or other employee of a company receiving bailout funds from receiving more than $400,000 a year in total compensation, including salary, bonuses and retirement contributions.

Man – now that’s what we elect Democrats for. And what’s really interesting is that this proposal is even more aggressive than the one proposed by Aresimowicz – bank tellers clock in a wage somewhere in the $12/hour range, so McCaskill would let them top off around 16X the wages of their front-line workers. And this bill seems to have Obama’s support.

Also of note from the Bloomberg article is a proposal from John Larson which will be a comfort to anyone who’s lived through the last eight years only to hear that this is not the time to look backwards or fix blame for the historically epic screwups that’ve taken place. Guess what – it is indeed the time to look backwards:

In the House, Democratic Caucus Chairman John Larson is proposing the creation of an independent commission to investigate the extent to which Wall Street abuses contributed to the economic crisis.

The commission would have 90 days to report back to lawmakers about regulatory, tax and other changes that should be considered. It also would examine derivative markets, mortgage- backed securities and other financial sectors to determine whether regulatory changes are needed.

“Did your regulatory agencies turn a blind eye to market manipulation and unethical behavior?” Larson, the fourth- ranking House Democratic leader, said in a statement. “Are new markets being monitored with outdated regulation? These are all questions the commission would answer.”

The panel would recommend a possible “investors’ bill of rights” designed to protect 401(k) retirement plans, pensions and other savings “from corporate greed and mismanagement,” he said.

This entry was posted on Saturday, January 31st, 2009 at 1:13 am and is filed under National Policy, State Policy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.