Executive Compensation

Peter Roskam’s Big Flip Flop on Bonuses

On January 21, 2010, in Economic Justice, Executive Compensation, Peter Roskam, Peter Roskam's Corporate Agenda, by RSR
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I originally published this on May 29th, 2009. In April 2009, Peter Roskam had voted against legislation, H.R. 1664, that would have limited bonus payments to executives of Fannie Mae and Freddie Mac. Today, apparently sensing political opportunity, Roskam introduced legislation to do that which he voted against:

Today, Congressman Peter Roskam (R-Ill.), Deputy Whip and member of the Ways & Means Committee, introduced The Protecting Taxpayers From Excessive Compensation Act, calling for new pay accountability rules for Fannie Mae and Freddie Mac. Roskam’s proposed legislation would prohibit any employee of Fannie Mae or Freddie Mac, while the entities are under conservatorship or receivership, from being compensated more than any member of our Armed Forces.

“With historic federal spending and debt on one end, and unprecedented taxpayer exposure to Fannie and Freddie on the other, now is the time to take a step toward restoring accountability and the public trust in the use of taxpayer funds,” Roskam wrote in a letter to Financial Services Chairman Frank and Ranking Member Bachus prior to the Committee’s Employment Compensation Hearing being held this Friday. “There are few government personnel that perform a more solemn and vital duty to our country than the Chairman of the Joint Chiefs of Staff. So long as Fannie and Freddie are effectively owned by the government, there is no reason any of their employees should be compensated more than the Chairman of the Joint Chiefs.”

Of course this time around, Roskam is making sure that the legislation won’t affect any of the big banks and investment houses that bankroll his campaigns and enable him to continue his project of making life better for big corporations. So sadly, this won’t help your 401K. Publicly traded companies will remain free as ever to spend your retirement money on bonuses and golden parchutes for their top executives.

Guess Peter Roskam thinks we are all pretty stupid.

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Peter Roskam’s been going to a lot of trouble to publicize his media appearances lately on his House website. Of course they consist mostly of clips from Fox News, Don Wade & Roma, and Big John & Cisco. Roskam doesn’t like to talk to anyone who might ask him a serious question. He just wants a friendly outlet for his talking points – designed to keep his base in a lather about the Dems so that they won’t realize that he’s screwing them in Washington. But I appreciate the time he’s taken to organize this material so its easy for me to find.

This video was interesting and Roskam seems to be pretty proud of it. Its a clip from Fox News back in March around the time the House voted on H.R. 1586, the measure that would have imposed a 90% tax on bonuses received in 2009 by high-paid employees of companies that received TARP bailout money. Roskam voted with the majority of House members (including about half of the Republicans) to approve the measure. And then he went on Fox News to play the outraged populist while smearing Treasury Secretary Timothy Geithner and the Obama administration for a mess they inherited from President Bush. I don’t think the measure ever went anywhere – just died in the Senate after AIG’s Chairman urged his employees receiving more than $100,000 to return at least half.

So was this a new Roskam we were seeing? Concerned all of a sudden about the outrages committed by big corporations at the expense of the little people back home in his district? Not so much. This was just Roskam the politician taking advantage of the moment.

Roskam showed his true colors on April 1st, when H.R. 1664, the Grayson-Himes Pay For Performance Act of 2009, came up for a vote. This was a more serious and comprehensive measure to address the issue of excessive compensation, not just for AIG but for other companies receiving bailout money as well:

The Pay for Performance Act of 2009 prohibits the payment of “unreasonable or excessive” compensation, including bonuses that are not based on performance, by Fannie Mae, Freddie Mac, the federal home loans banks, and firms that have received funds under the Emergency Economic Stabilization Act. The Treasury Secretary must define “unreasonable or excessive” compensation and outline what constitutes an appropriate performance-based bonus using criteria including the stability of a financial institution, ability to repay taxpayer funds, and adherence to appropriate risk management requirements. The prohibition only applies while government payments to the firms are outstanding. Firms subject to the Pay for Performance Act must report their compensation practices to the Treasury Secretary. Finally, the legislation applies bonus prohibitions included in the American Recovery and Reinvestment Act to all employment contracts.

When Roskam figured the folks at home were no longer paying attention, he dropped his faux outrage and voted against the measure. But you won’t see him promoting that fact on his website.

This was not the first time Roskam had stood up for outrageous executive pay. One of Roskam’s few floor speeches during his first term was to fight against a measure that would have given shareholders a voice in limiting the excessive pay of corporate executives. But I bet you’ll never see that video on his website.

That he uses his office to fight for unlimited executive pay is particularly sad given that Roskam has been an opponent of any efforts to raise the minimum wage for people who actually work for a living and voted against the Lilly Ledbetter Fair Pay Act earlier this term.

Interestingly, we understand that Peter’s new Press Secretary,Daniel Conston, is an A.I.G. alum. He also worked on the failed campaigns of Fred Thompson and John McCain. Let’s hope this endeavor goes better. But what happened to Matt? Did we convert him?

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Peter Roskam Does Finance Industry’s Bidding: Votes Against Regulatory Reform

On December 14, 2009, in Economic Justice, Executive Compensation, Mortgage Crisis, Peter Roskam, Regulatory Reform, by RSR
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Roskam Receipts by Sector through 20091206The chart above shows, by industry sector, Peter Roskam’s individual and political action committee (PAC) receipts as reported to the Federal Election Commission (FEC) through December 6th, 2009 for the 2010 election cycle. The source of the data is OpenSecrets.org. On their site you can see more detailed information about who is donating what to Roskam’s campaign.

As the chart shows, Roskam has received a total of $143,000 in campaign contributions thus far this cycle from the finance sector. His receipts from this sector dwarf those from any other industry.

Roskam paid the industry back the other day by voting against against a major regulatory overhaul designed to protect consumers from unfair practices by financial institutions and to prevent another economic meltdown like the one from which we are now just beginning to recover. The commercial banks and credit card companies who donated heavily to Roskam and other Republicans in the House were strongly opposed to reform.

The bill Roskam voted against is H.R. 4173, Wall Street Reform and Consumer Protection Act of 2009. The provisions of the bill, according to the House Financial Services Committee include:

  • Increase Consumer Protections: Creates the Consumer Financial Protection Agency (CFPA), a new, independent federal agency solely devoted to protecting Americans from unfair and abusive financial products and services.
  • Create a Financial Stability Council: Creates a council of regulators that will identify financial firms that are so large, interconnected, or risky that their collapse would put the entire financial system at risk. These systemically risky firms will be subject to increased oversight, standards, and regulation.
  • End Taxpayer Bailouts and “Too Big to Fail”: Establishes an orderly process for shutting down large, failing financial institutions like AIG or Lehman Brothers in a way that ends bailouts, protects taxpayers, and prevents contagion to the rest of the financial system.
  • Rein in Executive Compensation: Gives shareholders a “say on pay” – an advisory vote on pay practices including executive compensation and golden parachutes. It also enables regulators to ban inappropriate or imprudently risky compensation practices, and it requires financial firms to disclose incentive-based compensation structures.
  • Safeguard Investors: Strengthens the SEC’s powers so that it can better protect investors and regulate the nation’s securities markets. It responds to the failures to detect the Madoff and Stanford Financial frauds by ordering a study of the entire securities industry that will identify needed reforms and force the SEC and other entities to further improve investor protection.
  • Regulate Derivatives: Regulates, for the first time ever, the opaque $600 trillion over-the-counter (OTC) derivatives marketplace. Under the bill, all standardized swap transactions between dealers and “major swap participants” would have to be cleared and traded on an exchange or electronic platform. The bill defines a major swap participant as anyone that maintains a substantial net position in swaps, exclusive of hedging for commercial risk, or whose positions create such significant exposure to others that it requires monitoring.
  • Outlaw Predatory Mortgage Lending Practices: Would incorporate the tough mortgage reform and anti-predatory lending bill the House passed earlier this year. The legislation outlaws many of the egregious industry practices that marked the subprime lending boom, and it would ensure that mortgage lenders make loans that benefit the consumer. It would establish a simple standard for all home loans: institutions must ensure that borrowers can repay the loans they are sold.
  • Require the Registration of Hedge Funds: Closes a regulatory hole that allows hedge funds and their advisors to escape any and all regulation. This bill requires almost all advisers to private pools of capital to register with the SEC, and they will be subject to systemic risk regulation by the Financial Stability regulator.

    • The measure passed in the House by a vote of 223-202, with every single Republican in the House voting against it.  It is now up to the Senate to pass their own version of this legislation. According to analysis by the Center for Reponsive Politics, “members of the House who voted against the measure collected 70 percent more from commercial banks since 1989, on average, than those supported it. And they raised an average of 50 percent more from credit and finance companies than the bill’s supporters”.

    This is not the first time that Roskam has sided with the big banks and lenders. Just a few weeks back, Roskam voted against another major reform bill designed to protect consumers from the worst abuses of the credit card companies: H.R. 3639 – Expedited CARD Reform for Consumers Act of 2009. It is clear that if we want our Congress to do our bidding and not that of Wall Street, then we need to stop electing Congresssmen like Roskam who are in the bankers pockets.

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    Peter Roskam Casts Anti-Family Vote to Oppose Paid Parental Leave

    On June 10, 2009, in Executive Compensation, Healthcare, Middle Class, Peter Roskam, Peter Roskam's Corporate Agenda, by RSR
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    If I don’t have much good to say about Peter Roskam these days, I can at least credit him for being consistent. Roskam is quite consistently opposed to anything that might possibly benefit an ordinary working man or woman at the expense of the giant corporations and wealthy individuals whose interests he uses his seat in Congress to represent.

    It was no surprise when Peter Roskam voted against the Federal Employees Paid Parental Leave Act of 2009 on June 4, 2009. Congressman Roskam has been a fierce advocate of unlimited pay for corporate executives, but God forbid any working mother or father should be given the time and the financial wherewithal to care for a new child. Why that would make us no different than those Commie countries like… like Canada!

    H.R. 626 provides for 4 weeks of paid parental leave to federal employees surrounding the birth or adoption of a child. Federal employees currently receive 12 weeks of unpaid leave (as do all employees subject to the Family Medical Leave Act of 1993). The bill further provides that the employees can use accumulated sick time and vacation time to convert some or all of the balance of that 12 weeks into paid time. Finally, the Office of Personnel Management would be enabled to extend the paid period to 8 weeks. The measure applies only to federal employees and would be at best a weak immitation of pro-family policies in place in many Western countries. Hell, even Zimbabwe gives mothers 90 days at 100%.

    Roskam, of course, in addition to not wanting to spend a dime of our federal tax dollars on a working family, fears that the bill will be a foot in the door for future further enhancements to FMLA, something that Roskam’s corporate overlords at the U.S. Chamber and at the National Association of Manufacturers virulently oppose.

    Despite Roskam’s vote, along with those of most of his Republican colleagues, H.R. 626 passed by a vote of  258-154. It will now have to be taken up by the Senate.

    Peter Roskam deserves to be shamed for his anti-family vote. Please contact him today.  You can reach him at (202) 225-4561 in Washington or at (630) 893-9670 in Bloomingdale.

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    Peter Roskam’s Doublespeak on Executive Compensation

    On May 29, 2009, in Economic Justice, Executive Compensation, Peter Roskam, Peter Roskam's Corporate Agenda, by RSR
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    Peter Roskam’s been going to a lot of trouble to publicize his media appearances lately on his House website.  Of course they consist mostly of clips from Fox News, Don Wade & Roma, and Big John & Cisco. Roskam doesn’t like to talk to anyone who might ask him a serious question. He just wants a friendly outlet for his talking points – designed to keep his base in a lather about the Dems so that they won’t realize that he’s screwing them in Washington. But I appreciate the time he’s taken to organize this material so its easy for me to find.

    This video was interesting and Roskam seems to be pretty proud of it.  Its a clip from Fox News back in March around the time the House voted on H.R. 1586, the measure that would have imposed a 90% tax on bonuses received in 2009 by high-paid employees of companies that received TARP bailout money. Roskam voted with the majority of House members (including about half of the Republicans) to approve the measure. And then he went on Fox News to play the outraged populist while smearing Treasury Secretary Timothy Geithner and the Obama administration for a mess they inherited from President Bush. I don’t think the measure ever went anywhere – just died in the Senate after AIG’s Chairman urged his employees receiving more than $100,000 to return at least half.

    So was this a new Roskam we were seeing? Concerned all of a sudden about the outrages committed by big corporations at the expense of the little people back home in his district? Not so much. This was just Roskam the politician taking advantage of the moment.

    Roskam showed his true colors on April 1st, when H.R. 1664, the Grayson-Himes Pay For Performance Act of 2009, came up for a vote. This was a more serious and comprehensive measure to address the issue of excessive compensation, not just for AIG but for other companies receiving bailout money as well:

    The Pay for Performance Act of 2009 prohibits the payment of “unreasonable or excessive” compensation, including bonuses that are not based on performance, by Fannie Mae, Freddie Mac, the federal home loans banks, and firms that have received funds under the Emergency Economic Stabilization Act. The Treasury Secretary must define “unreasonable or excessive” compensation and outline what constitutes an appropriate performance-based bonus using criteria including the stability of a financial institution, ability to repay taxpayer funds, and adherence to appropriate risk management requirements. The prohibition only applies while government payments to the firms are outstanding. Firms subject to the Pay for Performance Act must report their compensation practices to the Treasury Secretary. Finally, the legislation applies bonus prohibitions included in the American Recovery and Reinvestment Act to all employment contracts.

    When Roskam figured the folks at home were no longer paying attention, he dropped his faux outrage and voted against the measure. But you won’t see him promoting that fact on his website.

    This was not the first time Roskam had stood up for outrageous executive pay. One of Roskam’s few floor speeches during his first term was to fight against a  measure that would have given shareholders a voice in limiting the excessive pay of corporate executives. But I bet you’ll never see that video on his website.

    That he uses his office to fight for unlimited executive pay is particularly sad given that Roskam has been an opponent of any efforts to raise the minimum wage for people who actually work for a living and voted against the Lilly Ledbetter Fair Pay Act earlier this term.

    Interestingly, we understand that Peter’s new Press Secretary,Daniel Conston, is an A.I.G. alum. He also worked on the failed campaigns of Fred Thompson and John McCain. Let’s hope this endeavor goes better. But what happened to Matt? Did we convert him?

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    Peter Roskam Fights for Higher Wages…For CEOs

    On December 3, 2007, in Economic Justice, Executive Compensation, Middle Class, Minimum Wage, Peter Roskam, Peter Roskam's Corporate Agenda, by RSR
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    The other day I took a look at the Congressional Record to try and get a better sense of what Peter Roskam is doing in Congress, what he is fighting for. As expected for a freshman, I guess, the record of his arguments before the House is not long. But what issues got Peter Roskam enthused enough to get up before the House and argue his position? How to provide health care to the nation’s uninsured children? Stopping the war in Iraq? Ensuring fair wage for hourly workers? Providing health services for brain-injured Iraq veterans? Protecting our civil liberties and the powers of Congress against an over-reaching executive branch? Nope, I didn’t find evidence of Roskam speaking to any of these issues.

    But Roskam did rise to speak to protect the compensation of highly paid corporate executives.

    It was April 18, 2007. At issue was H.R. 1257, Shareholder Vote on Executive Compensation Act. Roskam rose to speak against it. The bill, sponsored by Rep. Barney Frank, a Democrat from Massachusetts would provider for shareholders in a public corporation to have an advisory vote in determining the compensation of executives of that corporation.

    Now remember that Peter voted against giving minimum wage workers a raise. He thought it was just fine that these workers, who hadn’t had a raise in 10 years, should go on earning $5.15/hour. Meanwhile he was fighting to prevent shareholders, including those of us whose retirement savings are invested in public corporations, from having a voice in limiting excessive compensation to their CEO’s, compensation that robs shareholders of value and is paid at the expense of ordinary workers.

    According to figures reported by the AFL-CIO, the ratio of the average CEO’s pay to the average worker’s pay has increased from 42:1 in 1980 to 411:1 in 2005. In 2006, the average total compensation of the CEO of a Fortune 500 corporation was $14.78 million, a 9.4% increase over 2005. How many of the rest of us got a 9.4% raise? Is our labor really worth 411 times less than a corporate CEO?

    The AFL-CIO maintains a database of CEO compensation based on SEC filings. Here’s the size of the paychecks for selected CEO’s, including some of particular interest in Chicagoland:

    CEO Salaries

    Company CEO 2006 Compensation
    Abbott Laboratories Miles D. White $26,915,358
    Allstate Corporation Edward M. Liddy $23,983,783
    Aon Corporation Gregory C. Case $7,519,433
    Baxter International Inc. Robert L. Parkinson $13,582,043
    Boeing Company W. James McNerney $19,414,975
    Capital One Financial Corporation Richard D. Fairbank $37,438,699
    Caterpillar Inc. James W. Owens $14,818,621
    CDW Corporation John A. Edwardson $4,550,368
    Citigroup Inc. Charles O. Prince $25,975,719
    CNA Financial Corporation Stephen W. Lilienthal $5,274,745
    Exelon Corporation John W. Rowe $16,427,068
    Exxon Mobil Corporation Rex W. Tillerson $13,009,495
    General Dynamics Corporation Nicholas D. Chabraja $14,504,735
    Halliburton Company David J. Lesar $15,295,787
    Kraft Foods Inc. Irene B. Rosenfeld $8,958,736
    Lockheed Martin Corporation Robert J. Stevens $18,603,520
    McDonald's Corporation James A. Skinner $12,709,492
    Motorola Edward J. Zander $14,023,403
    R. R. Donnelley & Sons Company Mark A. Angelson $20,621,970
    Sears Holdings Corporation Aylwin B. Lewis $4,811,738
    Tribune Company Dennis J. FitzSimons $6,336,407
    UAL Corporation Glenn F. Tilton $23,809,557
    USG Corporation William C. Foote $12,301,110
    W.W. Grainger Inc. Richard L. Keyser $6,595,071
    Wal-Mart Stores, Inc. H. Lee Scott $29,672,533
    Walgreen Co. David W. Bernauer $7,616,643

    These are the guys who Peter Roskam is fighting for. They are the same guys who are are laying us off and outsourcing our jobs overseas while raising their prices for the goods and services we need and, in some cases, making fat profits off the war in Iraq that is killing and maiming our sons and daughters, the war that Peter Roskam refuses to stop. And Peter Roskam wants to make it possible for them to have no accountability regarding what they pay themselves. Meanwhile he is working to limit the wages of ordinary workers.

    Peter Roskam is out-of-touch with the needs of his constituents. We need a Congressman who will fight for the needs of ordinary people and will not just do the bidding of the President and of large corporations.

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