After my last post on WaMu executive bonuses, I noticed both in the NY Times (and on CNN) that several banking senior executives were hauled in front of Congress today to answer for the obscene bonuses they are receiving even though their companies have lost billions of dollars, many of their customers have lost their homes and the subprime mess has been a key factor in sending the American economy into recession.
Three executives, Charles Prince, former chief of Citigroup; E. Stanley O'Neal, former chief of Merrill Lynch; and Angelo R. Mozilo, chief of Countrywide Financial all defended their pay packages, stating that they had worked hard and had each contributed to the success of their companies.
Mr. O'Neil walked away with $161 million when he "retired", following over $10 billion in write downs by Merrill Lynch. Mr. Prince walked away with $110 million following $20 billion in write downs by Citi. For his part Mr. Mozilo has been paid more than $410 million since becoming CEO of Countrywide, and judging from his leathery tan he's spent more time hanging out with George Hamilton than guiding his company. Mozilo also had the balls to complain about his compensation. As for the rest, they all look like petulant private school brats who more than resent having their playtime interrupted by the principal.
For my part I think Elijah Cummings had it exactly right when he said, " We’ve got golden parachutes drifting off to the golf course and have people I see every day who are losing their homes and wondering where their kids will do their homework.”We’ve got golden parachutes drifting off to the golf course and have people I see every day who are losing their homes and wondering where their kids will do their homework.”
The more of this I see the more I believe that the lack of accountability of corporations to the societies in which they operate is the biggest problem with capitalism. If our politicians like Obama and Clinton really want to make our societies better this is ground zero.