WASHINGTON, DC – Senator Jim Webb (D-VA) urged that any legislation granting the federal government the authority to purchase $700 billion in bad assets include a strengthened regulatory structure to prevent future market instability and a cap on executive compensation in companies being rescued by the American taxpayer.
Webb advocated these two provisions in a letter to Senate Banking Committee Chairman Chris Dodd over the weekend while some members of Congress met on Capitol Hill to assess the financial rescue plan offered by the White House.
“It is inarguable that the regulatory structure now in place has not protected either our financial system or the U.S. taxpayer,” said Webb. “The administration is asking for an unprecedented rescue of the most profitable institutions in America with the taxpayers footing the bill. No bailout should occur without a return to increased regulation.”
Webb also insisted that, if taxpayer money is being used to bail out an American company, the limit on compensation to the company’s executives must be capped at the salary of senior federal government employees.
“We must ensure that executive compensation in those companies being rescued by American taxpayers is reasonable in scope, until this crisis has passed and the American taxpayers have been made whole,” said Webb.
Webb has been warning for several years that the excessive practices on Wall Street were risking the United States’ economic position in the world community and were unfair to the average worker.
“Executive compensation in the United States is outrageously out of proportion with any other period in our history, and with any other major country in the world today. Unless we insist on this basic principle of fairness, we will rightly risk the condemnation of our fellow citizens. Further, as the government purchases securities using this new authorization, it must do so at true market value or less. To do otherwise would subsidize those who precipitated this crisis,” said Webb.
To read the full letter sent by Senator Webb to Chairman Dodd, visit: http://webb.senate.gov/pdf/banksdodd.pdf
1 comment:
At heart, America has really always been dirigiste, in the tradition of Alexander Hamilton, Abraham Lincoln and Henry Clay. Thank God for the continuation of that tradition today by Senators Dodd and Webb.
I cannot imagine any British politician allowed on air saying anything like this, more is the pity. Only about two hours ago, the annual Labour Party Conference was applauding Gordon Brown's keynote speech in which he described Labour as "a pro-market party".
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