Big Brother will set all pay levels once federal bailout funds are received. Remember: some banks were forced to accept bailout money. Byron York, writing in the D.C. Examiner brings to our attention a truly awful prospect:
[T]he House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the "Pay for Performance Act of 2009," would impose government controls on the pay of all employees -- not just top executives -- of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place. And it would give Treasury Secretary Timothy Geithner extraordinary power to determine the pay of thousands of employees of American companies.[snip]
The measure is not limited just to those firms that received the largest sums of money, or just to the top 25 or 50 executives of those companies. It applies to all employees of all companies involved, for as long as the government is invested. And it would not only apply going forward, but also retroactively to existing contracts and pay arrangements of institutions that have already received funds.
In addition, the bill gives Geithner the authority to decide what pay is "unreasonable" or "excessive." And it directs the Treasury Department to come up with a method to evaluate "the performance of the individual executive or employee to whom the payment relates."
The suggestion represents an outrageous intrusion of the government into private commerce. The fact that it is sponsored by a man largely responsible for the credit mess takes it beyond imagination.
The Bill is scheduled to go to the House for a vote next week.
When do we get to extend the idea of pay for performance to Congress?