Getting Value for Our Money (or Not)

Bush overpaid banks in bailout, watchdog says – Yahoo! News:

“Overall, the panel and the analysts it retained to conduct the valuation study found that the Treasury used taxpayers’ money to pay $62.5 billion more than the value of assets in the 10 transactions it examined. By extrapolating to the more than 300 institutions that received money, the panel concluded that the government in effect paid $78 billion more than the actual value of the assets at the time.
‘Treasury chose to offer ‘one size fits all’ pricing in order to encourage all institutions to participate, and in so doing disregarded apparent differences in their financial condition,’ the report states. ‘A consequence is that Treasury effectively offered weaker participants greater subsidies than it offered to stronger participants.'”

(Via Yahoo! News.)

This was inevitable. Try to ram a plan that radically changed from day to day to fix a complex problem years in the making is going to make for “large” results. Depending on what Geitner puts out, we’ll see how good or bad in comparison. Personally and I don’t say this often, I’m with Newt Gingrich on this whole thing.

Salary Caps hit Wall Street

Obama’s cap on CEO pay strives to end era of excess |

“‘This is America. We don’t disparage wealth. And we believe that success should be rewarded,’ Obama said. ‘But what gets people upset – and rightfully so – are executives being rewarded for failure. Especially when those rewards are subsidized by US taxpayers.’
The cap on compensation marks a sharp pay cut for executives of some of the largest banks, such as Citigroup and Bank of America.
‘If these executives receive any additional compensation, it will come in the form of stock that can’t be paid up until taxpayers are paid back for their assistance,’ Obama said.”

(Via Christian Science Monitor.)

Contrary to conservative noises about communism, this is quintessentially American capitalist. Now if only corporate boards were actually independent of the executives they are supposed to oversee, we’d have this kind of check and balance all the time.