Thursday, June 11, 2009

U.S. Targets Excessive Pay

June 11, 2009 - U.S. Targets Excessive Pay for Top Executives Compensation Czar To Oversee Firms At Heart of Crisis By David Cho, Zachary A. Goldfarb and Tomoeh Murakami Tse

The Obama administration named a "compensation czar" yesterday to set salaries and bonuses at some of the biggest firms at the heart of the economic crisis, as part of a broader government campaign to reshape pay practices across corporate America.

Senior officials said they will install Washington attorney Kenneth R. Feinberg with the power to determine compensation, including retirement packages, of senior executives at seven firms that have received massive federal bailouts, such as Citigroup chief executive Vikram S. Pandit, Bank of America's Kenneth D. Lewis and Fritz Henderson of General Motors.

The initiative reflects public uproar over executive compensation, which has been stoked by the financial crisis. Lawmakers who approved the government's $700 billion bailout for the financial system last fall worried that taxpayers would end up financing the lavish lifestyles of top Wall Street executives. Then, controversy erupted in March when the Obama administration revealed that insurance giant American International Group, a recipient of a $180 billion rescue package, had decided to pay $165 million in bonuses to its most troubled financial unit.

Treasury Secretary Timothy F. Geithner said yesterday that the administration is not interested in "capping pay" or "setting forth precise prescriptions for how companies should set compensation." Instead, he said, the government wants to rein in pay practices that motivated executives to take excessive risks in pursuit of profit.

But with the spotlight now on executive pay practices, senior administration officials are moving to address concerns at firms well beyond those implicated in the crisis. Yesterday, officials proposed two pieces of legislation that separately empower shareholders and the Securities and Exchange Commission to exercise more oversight over executive compensation at all publicly traded firms.

The first measure would give shareholders more say on what companies pay executives. Traditionally, stockholders have had limited influence and the authority only to elect a small number of members who sit on a company's board of directors.

The second measure would expand the SEC's power to ensure that the corporate committees responsible for deciding compensation act independently of the top executives whose pay they set. Most large corporations have such committees, and their record in rewarding risky management has at times been troubling. Conflicts of interest between committee members and executives are common.

These efforts reflect the administration's conclusion that companies cannot police themselves on matters of pay.

"This financial crisis had many significant causes, but executive compensation practices were a contributing factor," Geithner said yesterday.

And more initiatives to address these practices are coming. The Federal Reserve is examining how regulators can oversee pay at all banks. Geithner and senior White House officials, meanwhile, plan to make executive pay a focus of their efforts to overhaul financial regulation, which officials say will be detailed next week.

The administration is giving Feinberg authority to influence pay at scores of companies. Feinberg, who previously managed the government's efforts to compensate the families of those killed in the Sept. 11 attacks, will control compensation at seven firms that have received large federal bailouts, including Citigroup, Bank of America, American International Group, General Motors, Chrysler as well as Chrysler Financial and GMAC, which provide loans to auto customers. He will be able to determine salaries, bonuses and retirement packages for all executive officers and the 100 most highly paid employees at each company.

He will also have the authority to set overall compensation, but not precise salary levels, for firms that have received smaller bailouts. The goal, officials said, is to curb the practice of tying pay to performance in a way that induces traders and executives to take big risks. Feinberg can also decide whether executives who have received what he considers excessive compensation should return some of that money.

For months companies have awaited clarification of the compensation restrictions imposed on recipients of bailout money. In February, the administration said it planned to limit salaries to $500,000 at banks that have taken "exceptional assistance." In addition, any bonuses would have to be paid in stock and could not be cashed in until after the government was repaid.

Later that month, Sen. Christopher J. Dodd (D-Conn.) wrote legislation that trumped those efforts and capped bonuses at one-third of executives' salaries. The new law applied only to firms that took bailout funds after Feb. 11.

Dodd's maneuver upset some Obama officials because his amendment and the administration's earlier guidance together curbed pay more than the White House intended. The officials began to worry that firms would drop out of government rescue programs or lose talented employees.

As a result, the administration announced yesterday that most firms receiving federal bailouts will face a limit on bonuses but not on salaries. For companies that accepted less than $500 million, the restriction would apply only to top executives. For those receiving more, the limit would also apply to 20 other top earners at each firm.

The response yesterday from industry and business experts varied widely. Some faulted the government for meddling in the private sector while others said the proposed changes were needed but may not prompt real reform. Rep. Barney Frank (D-Mass.), who leads the House Financial Services Committee, said the measures did not go far enough and plans to introduce legislation directing the SEC to outline guidelines for how compensation committees should determine pay.

Under the Obama plan, members of these committees would not be able to accept fees from their respective firms other than what they make for serving on the panels. Attorneys or consultants that help members in their work must be hired by and report to the committee rather than a chief executive.

Administration officials said they also hoped their efforts would pressure firms to rein in lavish pay by giving shareholders the right to vote on an executive's overall compensation package. This proposal, know as say-on-pay, would be nonbinding.

Some analysts warned that the vote wouldn't be taken seriously by companies because it is only advisory. About two dozen firms allow say-on-pay, and in no case has a proposed pay package been rejected by shareholders. "Will companies treat this as a compliance exercise they're being forced to do or will they embrace the process? It's an open question," said Patrick McGurn, a compensation expert at RiskMetrics, which advises big investors. "We hope it goes into the direction of an annual constructive dialogue on pay issues."

The proposal could give could give large investors such as mutual funds, pension funds and labor union retirement funds greater influence in expressing opinions on compensation. Administration officials said they hope companies will consult investors in designing pay packages.

President Obama proposed legislation to advance say-on-pay when he was in the Senate in 2007, but the bill stalled after facing stiff opposition from the Bush administration and big corporations.

The Obama administration cited Britain's say-on-pay legislation, enacted in 2002, as a model yesterday. A Harvard Business School study of the initiative found this year that it failed to curb pay among top executives at companies but succeeded at pressuring companies to scale back severance packages for executives whose companies fared poorly, according to Fabrizio Ferri, the professor who conducted the study.

Blog owner note: Has no one ever informed Obama that in America the government does not place a cap on wages. Mr. Obama it is called capitalism. JP

America's First Muslim Pressident?

June 11, 2009 - America's first Muslim president? Obama aligns with the policies of Shariah-adherents By Frank J. Gaffney Jr.

During his White House years, William Jefferson Clinton -- someone Judge Sonia Sotomayor might call a "white male" -- was dubbed "America's first black president" by a black admirer. Applying the standard of identity politics and pandering to a special interest that earned Mr. Clinton that distinction, Barack Hussein Obama would have to be considered America's first Muslim president.

This is not to say, necessarily, that Mr. Obama actually is a Muslim any more than Mr. Clinton actually is black. After his five months in office, and most especially after his just-concluded visit to Saudi Arabia and Egypt, however, a stunning conclusion seems increasingly plausible: The man now happy to have his Islamic-rooted middle name featured prominently has engaged in the most consequential bait-and-switch since Adolf Hitler duped Neville Chamberlain over Czechoslovakia at Munich.

What little we know about Mr. Obama's youth certainly suggests that he not only had a Kenyan father who was Muslim, but spent his early, formative years as one in Indonesia. As the president likes to say, "much has been made" -- in this case by him and his campaign handlers -- of the fact that he became a Christian as an adult in Chicago, under the now-notorious Pastor Jeremiah A. Wright.

With Mr. Obama's unbelievably ballyhooed address in Cairo Thursday to what he calls "the Muslim world" (hereafter known as "the Speech"), there is mounting evidence that the president not only identifies with Muslims, but actually may still be one himself. Consider the following indicators:

• Mr. Obama referred four times in his speech to "the Holy Koran." Non-Muslims -- even pandering ones -- generally don't use that Islamic formulation.

• Mr. Obama established his firsthand knowledge of Islam (albeit without mentioning his reported upbringing in the faith) with the statement, "I have known Islam on three continents before coming to the region where it was first revealed." Again, "revealed" is a depiction Muslims use to reflect their conviction that the Koran is the word of God, as dictated to Muhammad.

• Then the president made a statement no believing Christian -- certainly not one versed, as he professes to be, in the ways of Islam -- would ever make. In the context of what he euphemistically called the "situation between Israelis, Palestinians and Arabs," Mr. Obama said he looked forward to the day ". . . when Jerusalem is a secure and lasting home for Jews and Christians and Muslims, and a place for all of the children of Abraham to mingle peacefully together as in the story of Isra, when Moses, Jesus and Muhammad (peace be upon them) joined in prayer."

Now, the term "peace be upon them" is invoked by Muslims as a way of blessing deceased holy men. According to Islam, that is what all three were - dead prophets. Of course, for Christians, Jesus is the living and immortal Son of God.

In the final analysis, it may be beside the point whether Mr. Obama actually is a Muslim. In the Speech and elsewhere, he has aligned himself with adherents to what authoritative Islam calls Shariah -- notably, the dangerous global movement known as the Muslim Brotherhood -- to a degree that makes Mr. Clinton's fabled affinity for blacks pale by comparison.

For example, Mr. Obama has -- from literally his inaugural address onward -- inflated the numbers and, in that way and others, exaggerated the contemporary and historical importance of Muslim-Americans in the United States. In the Speech, he used the Brotherhood's estimates of "nearly 7 million Muslims" in this country, at least twice the estimates from other, more reputable sources. (Who knows? By the time Mr. Obama's friends in the radical Association of Community Organizers for Reform Now (ACORN) perpetrate their trademark books-cooking as deputy 2010 census takers, the official count may well claim considerably more than 7 million Muslims are living here.)

Even more troubling were the commitments the president made in Cairo to promote Islam in America. For instance, he declared: "I consider it part of my responsibility as president of the United States to fight against negative stereotypes of Islam wherever they appear." He vowed to ensure that women can cover their heads, including, presumably, when having their photographs taken for passports, driver's licenses or other identification purposes. He also pledged to enable Muslims to engage in zakat, their faith's requirement for tithing, even though four of the eight types of charity called for by Shariah can be associated with terrorism. Not surprisingly, a number of Islamic "charities" in this country have been convicted of providing material support for terrorism.

Particularly worrying is the realignment Mr. Obama has announced in U.S. policy toward Israel. While he pays lip service to the "unbreakable" bond between America and the Jewish state, the president has unmistakably signaled that he intends to compel the Israelis to make territorial and other strategic concessions to Palestinians to achieve the hallowed two-state solution. In doing so, he ignores the inconvenient fact that both the Brotherhood's Hamas and Abu Mazen's Fatah remain determined to achieve a one-state solution, whereby the Jews will be driven "into the sea."

Whether Mr. Obama actually is a Muslim or simply plays one in the presidency may, in the end, be irrelevant. What is alarming is that in aligning himself and his policies with those of Shariah-adherents such as the Muslim Brotherhood, the president will greatly intensify the already enormous pressure on peaceful, tolerant American Muslims to submit to such forces - and heighten expectations, here and abroad, that the rest of us will do so as well.

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Voight Calls Obama Good Actor

Voight calls Obama 'good actor' Hollywood star sees administration as 'slick, relentless' By Jennifer Harper

Jon Voight is a silver-screen conservative who considers the final speech of George Washington bedside reading. He is much moved by American mettle, military veterans, historical moments, Old Glory and youthful spirit.

And he's fierce about the state of his country. Very fierce.

"Democracy is an extraordinary adventure. It's difficult, full of daring and risk and danger. But it's the greatest gift we have," the Academy Award-winning actor said Tuesday during a visit to The Washington Times newsroom.

"The people who voted for President Obama are just beginning to wake up to exactly what they brought in. The 'change' they envisioned is not the 'change' they have gotten." Mr. Voight said.

He likens the Obama administration to a Hollywood script, rife with technique and craft, very compelling but not necessarily real.

"It is a very, very slick, relentless campaign to build Obama as the answer to all our needs. They know what people want and they give it in a package that can be read off a teleprompter. That's not what our country is based upon," Mr. Voight said.

He offered a terse review of the principal player.

"Obama is a very good actor. He knows how to play it. And he is very adept at creating this 'Obama' - this character who is there whenever the world needs something," he said.

Mr. Voight knows about acting - he's been a Hollywood icon for decades, first breaking through to audiences and grabbing an Oscar nomination for his role in 1969's "Midnight Cowboy."

He won the Academy Award as best actor for his role in the 1978 film "Coming Home" (ironically, liberal icon Jane Fonda won for best actress in the same film). His other famous 1970s roles include "Deliverance" and "The Champ." More recently, his turns in "Runaway Train" and as broadcaster Howard Cosell in "Ali" brought him his third and fourth Oscar nominations.

But Mr. Voight is no curmudgeon railing against change and pining for the old days.

To current audiences, he may be best known as the father of Oscar-winning actress Angelina Jolie. But he has raised his profile, not just politically, with a major small-screen role as Jonas Hodges in the current season of Fox's "24."

And The Times interview was the second occasion in two days that the actor has gone after Mr. Obama. On Monday, he stood before the National Republican Congressional Committee and delivered a speech to rally the party: 2012 beckons.

He delivered a fiery speech, in which he called Mr. Obama a "false prophet" and dubbed his administration the "Obama oppression" that would lead to the "downfall" of the country. "We are becoming a weak nation," he said in a speech that had his audience cheering and won praise afterward from Senate Minority Leader Mitch McConnell and former House Speaker Newt Gingrich.

At 70, the actor still strides through life with pronounced opinion, boundless emotion and strong faith. There is not much artifice about him. The slim star dresses in black his gaze is direct and inquisitive. His speech before appreciative Republicans was written on plain white paper, and in his own hand.

Mr. Voight admires Mr. Gingrich and praises his intellect, political convictions and down-to-earth demeanor. He frets about the safety of Israel. Leading conservative talk radio hosts and cultural observers who espouse traditional values with a modicum of optimism earn his gratitude.

"Let's give thanks to them for not giving up," he said.

His advice to his fellow Americans? Read up on the lives of the nation's founders, and understand that the founding of the nation was "an amazing moment in time," he said.

"I have at my bedside George Washington's final address to the American people, which was never delivered. But it was later published in newspapers throughout the country. His thoughts, his words - they are as relevant right now as they were when they were written. His warnings give us insight into what is going on right now," Mr. Voight said.

He has a personal stake in the first president. In sleek colonial uniform and white wig, Mr. Voight played George Washington in "An American Carol," a 2008 film that parodied such film industry liberals as Michael Moore and Rosie O'Donnell, among others.
And he's still playing the senior officer.

Mr. Voight is also a general in the burgeoning army of Hollywood conservatives who intend to support America, and buff up the American image for its own people, and an audience abroad. The battalion includes actors Gary Sinise, Kelsey Grammer, Patricia Heaton, Dennis Hopper and Pat Boone.

"The last time we all met, there were over a thousand people. Think about that. Hollywood conservatives, all of them different people, but all on the same path. It was very heartening," Mr. Voight recalled.

And like a good general, Mr. Voight knows his foes, and he has a simple strategy. He can rattle off a list of those who annoy him, from financier George Soros to House Speaker Nancy Pelosi and Vice President Joseph R. Biden Jr. And let's not forget the press.

"The news media has lied itself out of the business. Now, real accountability journalism. That says it all. That's what's been missing so long," he said.

He is vexed by bureaucracy, big government and soft-peddling by political correctness.

"This lie of political correctness is bringing this country down. You just want to break through it all."

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