April 4, 2011
Thank you for proposing these rules and taking my comments. I have several proposals:
Executives of any bank or other financial institution that received federal bailout or other funds would not be eligible for any salary above an amount set by the SEC (which should be low), and would not be eligible for any bonus whatsoever, until two calendar years after the loan or bailout was repaid in full, with interest.
This rule is retroactive, such that executives of said institutions who had received bonuses will be required to repay them, and will not be allowed to receive such bonuses until the conditions of the rule are satisfied.
All financial institutions (and indeed, all publicly traded companies) must comply with the following rule, regardless of if they have received a bailout or not: Executive compensation should be linked to employee compensation, such that the highest paid executive can never earn more than 25% more than the lowest paid employee of the same company. This compensation includes salary, benefits, stocks etc.
Such a rule would ensure that the profits of a company are widely shared between all those who make it happen, and that executives are not solely concerned with short-term stock prices but with the long-term prosperity of the companies they manage.