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I'm sure that this bailout news will make you happy!

by Paul C / December 3, 2008 1:00 AM PST

Then again, maybe it won't - but should you be surprised? Auditors fault Treasury policing of bailout funds:

Lawmakers want the Treasury to do a better job of insisting that banking institutions sharing in the $700 billion bailout comply with limits Congress imposed on executive salaries and use the money for its intended purposes.

In the first comprehensive review of the rescue package, the Government Accountability Office said Tuesday that the Treasury Department has no mechanisms to ensure that banking institutions limit their top executives' pay and comply with other restrictions.

"The GAO's discouraging report makes clear that the Treasury Department's implementation of the (rescue plan) is insufficiently transparent and is not accountable to American taxpayers," said House Speaker Nancy Pelosi, D-Calif.

The auditors acknowledged that the program, created Oct. 3 to help stabilize a rapidly faltering banking system, was less than 60 days old and has been adjusting to an evolving mission.

But auditors recommended that Treasury work with government bank regulators to determine whether the activities of financial institutions that receive the money are meeting their purpose.

Just imagine; government has wasted your money! Who woudda thunk it? Devil

And I have some questions: Where is it in the Constitution that permits the Federal Government to select winners (AIG, Citibank, etc.) and losers (Bear Stearns, Lehman Brothers, etc.) in the new high stakes game of Bailout Lotto? Why in the name of all that is right and holy is the government even allowed to set the game up in the first place? From where did it get that authority? And most importantly, when will it ever stop? It may not be soon, because the automakers are determined to be a winner at Bailout Lotto as well:

General Motors Corp. President Fritz Henderson said Wednesday bankruptcy isn't a viable option for struggling U.S. automakers, maintaining that a new retooling plan can save the industry.

Henderson said that General Motors is ready to undertake a host of steps needed to resize, but said that "to win, you've got to win with product and technology. ... And we do not want to give consumers a reason not to buy our cars and trucks."

General Motors is ready to undertake a host of steps needed to resize, Henderson asserted in an interview on NBC's "Today" show as the automakers outline a revised plan for Congress on how they'll preserve their industry.

But Henderson also said that "to win, you've got to win with product and technology. ... And we do not want to give consumers a reason not to buy our cars and trucks."

The interview came as leaders of the United Auto Workers were still discussing further concessions at an emergency meeting in Detroit. Under consideration were the possibility of scrapping a much-maligned jobs bank in which laid-off workers keep receiving most of their pay and postponing the automakers' payments into a multibillion-dollar union-administered health care fund.

Uh, Mr. Henderson, if you haven't noticed, we're not buying your cars now! Why do you think that a few billion of our dollars will make it better? And pardon me for saying this, Mr. Henderson, but you future rests not in consumers' hands, nor in the hands of Congress. It rests in the hands of the United Auto Workers - and I doubt you'll get much support from them without the legal support that you'll get in a bankruptcy.

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In the part of the interview I saw,
by drpruner / December 3, 2008 1:00 PM PST

he defended the automakers' marketing of similar models under e.g. Chevy and GMC. He said they've identified different motivations for the different buyers. This is the GM whose Alfred P. Sloan is famous for having developed market-driven engineering- planned obsolescence and such.
He says we need Ford and Mercury, Sierra and Siverado and so on. Business as usual.
He also says some executives will work for a dollar a year. Will work- do they need special permission to change their contracts??

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Steve Jobs is famous for working for a dollar a year...
by grimgraphix / December 3, 2008 11:22 PM PST

However, he gets associated benefits that cover some of his living expenses. As an example...

"In Apple's fiscal year 2000, for instance, the company decided to give Jobs a Gulfstream V jet worth $43.5m, as well as $40.5m to pay for the taxes and other costs associated with granting the plane. Apple's board of directors voted to award the plane to Jobs in December 1999, but it was only delivered in fiscal 2001 and thus wasn't counted in his compensation until then, according to the SEC filing."

Working for an annual salary of a dollar does not address the idea of CEOs receiving pay that is wildly inflated when compared to their actual performance. It is just face saving grandstanding, pure and simple. They will make their money in other ways, including free perks that will total in the hundreds of thousands of dollars.

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