ARE YOU MAD YET AMERICA???

$1.6 billion of your taxpayer bailout money has gone to failed bank executive's pockets this year. In mid-December 2008, well before "normal" bonus time on Wall Street, the Associated Press reported that "$1.6 billion of YOUR TAXPAYER BAILOUT MONEY went to bailed-out bank executives." This $1.6 billion was in salaries, bonuses and other benefits an Associated Press analysis reveals and hurried along to be paid out before Congress could actually wake up and act to limit the executive compensation in the TARP (Troubled Assets Relief Program). Remember, originally, TARP was designed to buy up the bad debts from the balance sheets of these banks, so according to some, "it wasn't foreseeable that this compensation abuse issue would arise." I wrote about it for another publication in detail in the early FALL of 2008 when the whole issue first arose and warned each of my Congressmen, Senators and their staffers that the first thing that would happen with out taxpayer bailout money is that the executives would pay themselves royally. Yet, still, no safeguards were put in place for your FEDERAL REPRESENTATIVES to act in a good fiduciary role with regards to YOUR money. And, so NOW, in February 2009, we have a new president, Obama, who has shown the light after the fact on the situation and chastised these greedy executives on Wall Street.

I hope that the American people, Red or Blue, Black or White or Brown, all have a problem with this. Let me explain. The fundamental issue at hand initially was that Wall Street was crying after the failure of Bear, Sterns and Lehman Brothers that URGENTLY they were going to be out of funds for operation and go belly up within seconds, hours, days...if they didn't get their share of TARP money ASAP. So, they threatened that ALL of Wall Street would be unemployed imminently and America would be in further financial crisis PLUS an unemployment level unprecedented in the last 20 years. OK, so Congress and the Senate let the then Treasury Secretary dole out funds to these Wall Street Guru Lobbyists who told us that giving them this bailout money would start lending in the USA again, preserve jobs across the board of industries in America because lending would again be free flowing, and that would be the end of the need for bailout money and the solution to the Holy Grail.

DID YOU BUY THAT LIE??? Our then Secretary of the Treasury, himself a former Goldman Sachs senior executive, INSISTED that this would be the answer. And so it was......the first bailout tranches have all been spent. So, do YOU have a clue where that money went? Below are some details provided by AP researchers from Federal Documents about how the first bailout was spent.

The rewards came even at banks where poor results last year foretold the economic crisis that sent them to Washington for a government rescue. Some trimmed their executive compensation due to lagging bank performance, but still forked over multimillion-dollar executive pay packages. The AP review of federal securities documents found that these benefits included cash bonuses, stock options, personal use of company jets and chauffeurs, home security, country club memberships and professional money management, health club benefits, and, get this, FINANCIAL PLANNING!

"The total amount given to nearly 600 executives would cover bailout costs for many of the 116 banks that have so far accepted tax dollars to boost their bottom lines. The AP compiled total compensation based on annual reports that the banks file with the Securities and Exchange Commission. The 116 banks have so far received $188 billion in taxpayer help. Among the findings:

The average paid to each of the banks' top executives was $2.6 million in salary, bonuses and benefits.

Lloyd Blankfein, president and chief executive officer of Goldman Sachs, took home nearly $54 million in compensation last year. The company's top five executives received a total of $242 million."

The AP also reported that this year, Goldman will forgo cash and stock bonuses for its seven top-paid executives. They will work for their base salaries of $600,000, the company said. Facing increasing concern by its own shareholders on executive payments, the company described its pay plan last spring as essential to retain and motivate executives "whose efforts and judgments are vital to our continued success, by setting their compensation at appropriate and competitive levels." Goldman spokesman Ed Canaday declined to comment beyond that written report. Goldman, a New York-based company on Dec. 16 reported its first quarterly loss since it went public in 1999. It received $10 billion in taxpayer money on Oct. 28.

Even where banks cut back on pay, some executives were left with seven- or eight-figure compensation that most people can only dream about. Richard D. Fairbank, the chairman of Capital One Financial Corp., took a $1 million hit in compensation after his company had a disappointing year, but still got $17 million in stock options. The McLean, Va.-based company received $3.56 billion in bailout money on Nov. 14.

John A. Thain, chief executive officer of Merrill Lynch, topped all corporate bank bosses with $83 million in earnings last year. Thain, a former chief operating officer for Goldman Sachs, took the reins of the company in December 2007, avoiding the blame for a year in which Merrill lost $7.8 billion. Since he began work late in the year, he earned $57,692 in salary, a $15 million signing bonus and an additional $68 million in stock options. Like Goldman, Merrill got $10 billion from taxpayers on Oct. 28. Oh, let me add that John Thain was recently thrown out on the "Street" by his new boss, Bank of America and because of Thain and other Merrill executives' compensation packages which were quickly dished out prior to the close of the B of A merger. Merrill sucked so much out of the company that they drove into the ground that Bank of America came back to the taxpayers and got another $20 billion dollars worth of rescue money from YOUR TAXPAYER PIGGYBANK to make up for Thain's boys payout day. We won't even talk about the close to $100,000 renovations Thain did recently to his Merrill executive office as that is old news by now. According to press sources, he now says he'll now pay back the renovation costs. Show us the check, we'd love to see it!

The AP review comes amid sharp questions about the banks' commitment to the goals of the Troubled Assets Relief Program (TARP), a law designed to buy bad mortgages and other troubled assets. Last month, the Bush administration changed the program's goals, instructing the Treasury Department to pump tax dollars directly into banks in a bid to prevent wholesale economic collapse.

The program set restrictions on some executive compensation for participating banks, but did not limit salaries and bonuses unless they had the effect of encouraging excessive risk to the institution. Banks were barred from giving golden parachutes to departing executives and deducting some executive pay for tax purposes. The AP reports that, "Wells Fargo of San Francisco, which took $25 billion in taxpayer bailout money, gave its top executives up to $20,000 each to pay personal financial planners." AP also reports that, "at Bank of New York Mellon Corp., chief executive Robert P. Kelly's stipend for financial planning services came to $66,748, on top of his $975,000 salary and $7.5 million bonus. His car and driver cost $178,879. Kelly also received $846,000 in relocation expenses, including help selling his home in Pittsburgh and purchasing one in Manhattan, the company said." Further review of the federal documents showed the AP that, "Goldman Sachs' tab for leased cars and drivers ran as high as $233,000 per executive. The firm told its shareholders this year that financial counseling and chauffeurs are important in giving executives more time to focus on their jobs. And, JPMorgan Chase chairman James Dimon ran up a $211,182 private jet travel tab last year when his family lived in Chicago and he was commuting to New York. The company got $25 billion in bailout funds. Banks cite security to justify personal use of company aircraft for some executives."

ARE YOU MAD YET AMERICA? WHAT HAPPENED TO THE RESULTS PROMISED TO YOU IN THE JOINT STATEMENT FROM BOTH PARTIES ANNOUNCING THE DISHING OUT OF YOUR FUNDS??? WHAT HAPPENED TO THE RESULTS THAT SECRETARY OF THE TREASURY, HENRY PAULSON, THE FINANCE GURU, PROMISED YOU WOULD RIGHT THE FINANCIAL WOES OF AMERICA??? ALLOW ME TO TELL YOU WHY IT FAILED. I'LL GIVE YOU THE SAME REASONS NOW THAT I GAVE MY REPRESENTATIVES IN THEIR LETTERS LAST FALL:

1. You have the financiers from Wall Street who bought up pooled bad assets without questioning them and traded and bought for their own accounts, derivative products that few of their employees even truly understand without ever analyzing the underlying assets, as the ones dictating to the Treasury what exactly it will take to get everything back on course? Do you allow a candy thief back into the candy store to be in charge of it and dictate its policies?

2. Americans should seriously question whether our Treasury Secretary, Paulson, and his assistant in charge of executing the program, both former Goldman employees can have "clean hands" and "unbiased intentions" while handing out ENORMOUS chunks of money to their former, and perhaps again future, colleagues as they quickly execute this free-for-all at the end of the Bush administration without many if any Congressional guidelines within which to operate.

3. Without guidelines for use of these bailout proceeds, it was obvious to me that the Wall Street "save me first" mentality would be predominant, and was. So, the shored up the capitalization of their firms and overcompensated their executives yet again. After all, wouldn't it have been reasonable to expect that EVERY employee left on Wall Street at a firm that received bailout funds would have the grace and pleasure of getting paid ONLY his/her regular salary in light of the fact that they came with hats in hand begging to the taxpayers for money?? Gee, there's a thought. After all, Wall Street Lobbyists came begging saying that if they didn't get the bailout funds, ALL these gurus would be unemployed. So, seems reasonable that having a job and having a salary and using the bailout funds for LENDING again would have been very clearly the MANDATE in this situation, right? How come, Joe Average is the only one who sees it this way??? Ethics are so warped in this entitlement atmosphere of Washington and New York City that without very clear guidelines, no money should have been given in this bailout.

4. What's the worst case scenario if these banking institutions failed? Your bailout money would have been used to pay the new $250,000 level of FDIC claims on individual banking deposits. In addition, money would have been left over to be lent to those needing working capital in QUALIFYING small and medium businesses that really need it to legitimately stay in business to turn a profit. Money would have been there to lend to QUALIFIED homebuyers, not to LIARS with LIAR LOANS NINA's).

THE REALITY IS THAT AMERICA NEEDS A NEW PARADIGM FOR ITS ECONOMY. BAILOUT NUMBER ONE WAS A PREDICTABLE FAILURE. BAILOUT NUMBER TWO IS SO FAR OFF THE MARK OF ANYTHING THAT CAN KEEP YOU OFF THE UMEMPLOYMENT LINE OR OFF WELFARE OR FROM BEING WITHOUT HEALTH INSURANCE THAT IT IS A FORESEEABLE, MORE EXPENSIVE FAILURE. WE CANNOT ASPIRE TO GO BACK TO THE IMAGINARY LEVEL OF DRUNKEN PROSPERITY THAT WAS PURCHASED WITH DEBT AND THEREFORE NEVER A REALITY! BUYING WORTHLESS ASSETS AND MAKING THE AMERICAN PEOPLE RESPONSIBLE FOR THEM STILL SHOULD NOT HAPPEN. LET THE LOSING BANK BUSINESSES FAIL -if these Wall Street executives are so knowledgeable and so capitalistic, they would not be CAPITALIZING ALL THE PROFITS AND THEN SOCIALIZING ALL THEIR LOSSES UNTO THE AMERICAN PEOPLE. SORRY BOYS, YOU CAN'T HAVE IT BOTH WAYS. Either you are a capitalist, in which case you should receive no bailouts and fail on your own merits according to Adam Smith's doctrine, or be socialized and let the Federal Government lend the money directly so at least it doesn't line the undeserving failed guru pockets while leaving Americans worse off. As a capitalist, I think they should fail. Capitalist doctrine is Darwinistic in its belief that successful economic paradigms will sustain themselves without government intervention. If they fail, I predict that many of the Wall Street gurus will form their own firms and market the next new capital markets product to the unaware just like they did when they left major firms to start hedge funds. While it is simply wrong to reward failure according to American work ethic, but it is criminal to do it with taxpayer money and all funds that were awarded personally to these failed employees, not just executives, should ALL be clawed back into the American people's Treasury.

Submitted by ASO member: Kimberly Wilcox