Britain and US derail global deal to limit banker bonuses

It seems somewhat ironic that the two nations with the most bankrupt financial systems are the ones leading the offensive against reform.

Attempts to clamp down on bankers' bonuses to prevent another global financial crisis were in disarray last night as Britain and America opposed proposals by other European Union nations.
France led calls for a cap on individual bonuses but Britain and America, while backing common rules to prevent excessive bonuses, argued that a "pay policy" would be unworkable. They suspect that bankers would find loopholes such as incorporating bonuses into pay.
Christine Lagarde, the French finance minister, said: "They [bankers] are active participants in the economy but they are not above the rules and they should have a real interest in making sure that what we went through (the crisis) does not happen again. As far as governments are concerned, their responsibility is not to the City. It is to the public."
Seven EU countries led by Sweden, which holds the EU's rotating presidency, urged the G20 to take tough action on "dangerous, indecent, cynical and unacceptable" rewards for bankers. They want a ban on bonuses guaranteed for more than a year, arguing that bonuses should instead be paid out over a number of years and should "mirror the individual's and the bank's actual performance over time".
The plan was also backed by France, Germany, Italy, Spain, Luxembourg and the Netherlands. Sweden will increase the pressure on Britain to move towards the Europeans' stance by calling a special meeting of EU leaders a week before the Pittsburgh summit.
Hopes of a deal on bonuses appeared to rise on Thursday when Gordon Brown, the French President Nicolas Sarkozy and the German Chancellor Angela Merkel put their names to a joint letter calling for binding rules. But as the finance ministers' talks got underway, it was clear that there was little agreement on the detail – and that Britain would join the US in opposing a cap.

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It's all about protecting the financial oligarchy.

just pathetic

They are "banking" on the public having a short attention span on this.

Notice that? There was outrage over bonuses and then people went back asleep again.

We must have executive compensation restructured and some serious reforms on corporate governance as well.

What do we get? Oh, a "nonbinding" shareholder vote and the financial lobbyists are fighting even that, tooth and nail.

Even worse, the MSM focuses in on horse races and fringe crazies....they never focus or talk about the real outrage in this country and what it is really over...

probably because that would expose the reality there is no "Democratic/Republican" great divide (although there is a divide in solution approaches) but on many outrageous executive pay, that one crosses philosophies, party lines.

It's obviously a rigged game and it cuts into corporate profits. I forget the percentage but it was amazingly high how much profit is pocketed due to executive compensation ...and that's just went the company is making money...they can run that company into the ground...or better yet...cause a global economic meltdown...and nothing happens to their compensation packages and bonuses for the most part.

Questions of Value

Compensation packages get worked out in a dance of collusion, and that adds to the nebulous item called "overhead." Moving "other people's money" about generates fee income and adds to costs. Once upon a time, no one questioned why a brokerage house charged commissions of two percent to retail accounts. Then someone questioned it and the commission structure shrank.
It is time shareholders got a structure to question these outrageous packages that turn out to be works of fiction. Not unlike the "origination fee" we often see in banking -- no competition, and not based on actual cost or value -- it's "just standard." After all the smoke and mirrors of recent years, nothing should be standard any longer.
Frank T.

Frank T.

a very weak bill

passed the house. All it does is give a symbolic vote, nonbiding to shareholders on executive comp.

Believe this or not, even that, supposedly they are going to kill in the Senate.

It's like the Senate is nothing more than a pure corporate lobbyist dream fest. The Senate needs a major flush!