According to today's Wall Street Journal, President Obama is expected to name Kenneth Feinberg as the pay czar for the Treasury Department. Mr. Feinberg will be in charge of overseeing the pay and bonuses paid to corporations that receive Troubled Asset Relief Plan (TARP) money. According to the article:
"The Obama administration earlier this year issued guidelines that include limiting salary for top executives at some firms receiving TARP funds and requiring that additional pay be in the form of restricted stock, vesting only after the company repays its debt, with interest, to the government. Congress then chimed in with even tougher rules curbing bonuses for top earners at firms receiving TARP money. As part of that effort, lawmakers barred those firms from paying top earners bonuses that equal more than a third of their total compensation."
The fact that the government has any say in what anyone in the private sector receives as pay or bonuses is troubling to me. There will be no appeal of the decisions made by the "Pay Czar". Right now, this is only supposed to apply to companies that took TARP money, but I am convinced that we will see it extended to all companies in the near future.
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