Wednesday, October 15, 2008

Fooled again

Not really. I didn't actually believe that the bail out plan would limit executive compensation. As it turns out, the limits imposed on executive salaries are that the salaries are just not tax deductable in amounts over $500,000. The companies are still able to pay whatever they want to executives, they just don't get to deduct it.

As the article notes, the same provision has applied since 1993, but the limit wat $1,000,000. Boy, that worked, eh?

And the kicker? Since these banks are all losing money right now, they're going to have no income upon which to pay taxes. So limiting tax deductions when they're not paying taxes anyway is meaningless.

Hank Paulson, creature of Wall Street, hired to reign in Wall Street.

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