Fannie Mae And Freddie Mac Bonuses

| | Comments (0) | TrackBacks (0) posted an article today stating that the top twelve executives at Fannie Mae and Freddie Mac will receive bonuses and incentive payments this year of up to $5 million.   At the same time Ed Morrissey at Hot Air is reporting that the Obama Administration has decided to cover an unlimited amount of losses at Fannie Mae and Freddie Mac. 

According to the article:

"The Treasury announced Thursday it was removing the caps that limited the amount of available capital to the companies to $200 billion each."

This is an amazing combination of facts.  On October 16th, posted an article stating:

"Today's Power Line posted an article on the Pay Czar's decision that Ken Lewis, Chairman of the Board of Bank of America, would work for free in 2009.  Not only will he not be paid for the rest of the year, he has been asked to return the $1 million he has already received this year.  Mr. Lewis agreed to the decision, stating that "he felt it was not in the best interest of Bank of America for him to get involved in a dispute with the paymaster.""

The argument made at the time for the government's being able to cut Ken Lewis' pay so drastically was that the government had bailed out the Bank of America financially.  The government has also bailed out Fannie Mae and Freddie Mac, so why do thier executives receive hugh bonuses while the head of Bank of American loses his pay? 

This seems to be a very uneven exercise of government power and may be an example of why the government should not be allowed to meddle with salaries in the business community. 

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This page contains a single entry by Granny G published on December 27, 2009 9:54 PM.

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