$500K Salary Tough For Banking Execs

[Reborn]

By LILY FU, MyFox National
NEW YORK - Last week President Obama announced that those banking executives who were accepting bailout funds would have their salaries capped at $500,000.

Seems like plenty of money. But for many Wall Street execs, it's a tough pill to swallow.

The New York Times pounded out some numbers to show just how the city's elite live their lives. Here are some sample yearly living expenses:

Mortgage: $96,000
Co-op maintenance fee: $96,000
Summer house in Southampton: $240,000
Taxes: $293,000
Nanny: $45,000
Chauffeurs, bodyguards: $192,000
Two children in private school: $64,000
Two vacations: $16,000

All that adds up to $749,000.

Now most people would say, "Cut down on the luxurious expenses, live in a cheaper apartment and commute on the Metro." But as "Sex and the City" author Candace Bushnell explained to the New York Times, it's not that easy.

"People inherently understand that if they are going to get ahead in whatever corporate culture they are involved in, they need to take on the appurtenances of what defines that culture," she said. "So if you are in a culture where spending a lot of money is a sign of success, it's like the same thing that goes back to high school peer pressure. It's about fitting in."

[DefensiveCarry.com]

[Paco]

I disagree with her assumptions, it really is that easy to do:

Mortgage: $24,400
Co-op maintenance fee: $350 (HOA)
Holiday Inn from Expedia.com: $150 per night (4 kids so it costs me extra)
Taxes: $13,000 (approx before deductions, etc.)
Nanny: $0 (we take care of our own kids, not someone else's job)
Chauffeurs: , I actually hate when other people drive.
Bodyguards: $250 (with rebate gift card that is all my Sigma cost me, add $25 for a box o' hollow points)
Two children in private school: $0 (We have 4 kids and we home school)
Two vacations: Again, . The most fun I ever had on vacation was the Holiday Inn from above at the beach that we drove to in our own car driven by me with only myself, my Wife, and my 4 kids. No Nanny, no bodyguard, no chauffeur, no personal assistant, nada!

I may not be a big wig Wall Street tycoon, but if I loose my job I cut off the cable and start eating beans and rice until I can get a new job.

Dang it, I am sorry guys. I did it again...

I am using COMMON SENSE in an emotional situation.

[tinkerinWstuff]

I don't agree when the government startes telling private companies what wages they should be paying. Not sure where I stand on it when it's tax payer money but I find it funny how the government was in such a rush to dole out money and then set up the rules later.

As far as Candace Bushnel is concerned, she should read The Millionaire Next Door.

[GreenHorn]

I couldn't help but notice that more than half of the 500,000$ goes straight back to the feds in taxes.

[Tubby45]

The government shouldn't be telling private corporations how to pay their employees.

[SIXTO]

I agree that the gubment shouldnt be telling companies how much they can pay their help, but, the banks made a deal with the devil in this situation.

I'm not one to get worked up over what somebody else makes. We all made our choices in life, and I'm old fashioned thinking that its none of my business what somebody else earns.

[archer51]

I don't agree when the government startes telling private companies what wages they should be paying. Not sure where I stand on it when it's tax payer money but I find it funny how the government was in such a rush to dole out money and then set up the rules later.

As far as Candace Bushnel is concerned, she should read The Millionaire Next Door.

Have to disagree with you. Since the government is using MY/OUR to bail them out, I think they should be able to control salaries, until the bail back is paid back. I don't remember which bank it was, but they tried to pay one of the top executives his bonus with the bail out money. Left unchecked the companies will blow through the money within a year and be back begging for more.

[packinnova]

I agree that the gubment shouldnt be telling companies how much they can pay their help, but, the banks made a deal with the devil in this situation.

I'm not one to get worked up over what somebody else makes. We all made our choices in life, and I'm old fashioned thinking that its none of my business what somebody else earns.

agreed to some extent, but they(wall street execs) didn't exactly make the choice for themselves. The choice was made for them. There were a series of meetings with the company heads and FED and it was basically to say that you WILL take this money or else(not including the auto industry bailouts).

[Hopyard]

The government shouldn't be telling private corporations how to pay their employees.

Stockholder, through the BOD, should be setting executive compensation. When a bank accepts billions of dollars from Uncle in exchange for stock Uncle gets to say something about the way the bank is run, same as if any billionaire bought a controlling interest in any company.

Besides, these multi-billion dollar salaries and perks which have become common recently throughout the corporate world are nothing but the stealing of stockholder equity. It is past time some regulation was in place to protect the investor---you know, you guys who have 401 Ks and state pension plans.

If the collective stock investment of your large cap pension fund went to XXXCORP, but they had not control over how much the execs got in salary, and XXX execs took 2/3 of the invested money in salary, what would that do to the pension plan?

Executive salary caps are badly overdue and definitely needed.

[Tubby45]

I strongly disagree. The government does not have the power to set wages for common workers or executives of private companies.

What if the government cut your pay down to $6/hr?

[SIXTO]

I strongly disagree. The government does not have the power to set wages for common workers or executives of private companies.

What if the government cut your pay down to $6/hr?

If the government is who I'm working for, I guess they could do that. Because the gubment pretty much bought these banks, they can dictate these things, just like it was explained in others posts.

Now I agree the gubment shouldnt be messing with private business, but thats a whole new topic.

[fatcat]

Have to disagree with you. Since the government is using MY/OUR to bail them out, I think they should be able to control salaries, until the bail back is paid back. I don't remember which bank it was, but they tried to pay one of the top executives his bonus with the bail out money. Left unchecked the companies will blow through the money within a year and be back begging for more.

That is a fair point. If they are using government money to stay afloat, the government should have some say.

If you take out a business loan from a bank, that bank often has a lot of say in how you spend your money. They can tell you who to hire and how much to pay your management team. They can tell you where you need to direct the flow of your money. They can even restrict your funds.

So if the banks have been putting stipulations on money they lend, a serious argument can be made that the government (the lender) should have some input as to how their money is spent.

I agree with those that say the government should not have any say on salaries of private companies. But in a sense, these institutions are no longer private. They are owned by the tax payers in a sense, and until they are able to pay that money back their lender (the government) should be able to have oversight of their finances.

[Tubby45]

The government did not have the power to lend money in the first place.

[JOHNSMITH]

Well, its just the lifestyle that comes with that much regular income. We can't seriously expect them to live in a small 3 bedroom home in a quiet, regular suburb and drive a Kia to work. They're going to live a bit better than us and have more expenses as a result.

I'm sure some homeless man would think we're stupid for spending money on fast food, TVs, cars (isn't a motorcycle "enough"?), nice shoes, nice clothes, homes with yards, etc. It's acceptable to us because msot of us have income levels that allow this. The same goes with executives, except they have a higher income level.

Honestly, I just see this running away any executives with a shred of talent and bringing in crappy CEOs who are actually willing to run such a big company with such terrible problems while getting paid only $500k.

The government shouldn't be telling private corporations how to pay their employees.

True, but in this case, they basically *are* government companies, so there's technically nothing wrong it. It does miss the point, though, and is just intended to make the sheeple feel like the government is doing something to the "big bad executive."

[tinkerinWstuff]

Have to disagree with you. Since the government is using MY/OUR to bail them out, I think they should be able to control salaries, until the bail back is paid back. I don't remember which bank it was, but they tried to pay one of the top executives his bonus with the bail out money. Left unchecked the companies will blow through the money within a year and be back begging for more.

Maybe you should have read my very next sentence.

And I'll reiterate the second half of that next sentance that said the difference here is when the "guberment" (as Sixto says) decided to make up the rules AFTER doling out our tax money instead of before.

There were banks who didn't WANT the bailout money but were all called in and told they NEEDED to take the money otherwise it would show that some banks were weaker than others and could have caused a run on the banks. Anyone see the full page ad in the Wall Street Journal that basically told off the media and government to go pound sand?