Claire McCaskill Lays Down Law On CEO Compensation
Sen. Claire McCaskill has delivered a sharp threat to the wallets of corporate executives who took large compensation packages even as their companies accepted government bailout funds. Things, she warned, are going to change.
"I've been mad for a while," said the Missouri Democrat. "When we passed the initial half of the TARP money, [there were] rumors about bonuses, the fact that too many of these guys were holding onto the jobs even though they were running these companies into the ground. Reality didn't seem to be the order of the day."
So McCaskill took to the Senate floor on Friday to put an end to the surrealism. In a bill that came to the surprise of reporters, her colleagues, and the White House alike -- there was no coordination with the Obama administration, she said -- the Missouri Democrat called for compensation for employees of bailout recipients to be capped at $400,000 a year.
"They don't get it," McCaskill said on the floor. "These people are idiots. You can't use taxpayer money to pay out $18-billion in bonuses... What planet are these people on?"
In an interview with the Huffington Post, however, McCaskill didn't just take on corporate CEOs. She criticized some of the spending in the House stimulus package, saying that her fellow Democrats had been "over-anxious."
"Whether it is the National Endowment of the Arts or some of the STD funding or contraceptive funding, all we did was just tee up ammunition for the other side to tear this thing down," she said. "And I would like to think we are smarter than that. I'm hopeful on the Senate side we will be smarter than that."
McCaskill chalked up the mistakes to Democrats only just getting comfortable to life without a Republican president. "There has been such a starvation diet for some of these programs that the appropriators got a little over-anxious in the House. They probably did some things they shouldn't have."
McCaskill also made news predicting that "a few" Republican senators would support the Employee Free Choice Act, a labor community priority that has engendered heated debate between the two political parties. And she called on leadership in her party to vote on the legislation -- which would allow unions to organize more easily -- "sooner rather than later."
Below is a write up of the interview, edited in some parts to read more smoothly.
QUESTION: Tell me how you came about introducing this bill.
MCCASKILL: I've been mad for a while, when first there was talk -- even within weeks of when we passed the initial half of the TARP money, [there were] rumors about bonuses, the fact that too many of these guys were holding unto the jobs even though they were running these companies into the ground. Reality didn't seem to be the order of the day. This culture, this idea, that these guys are entitled not just to their jobs but to excessive compensation, even when their companies were in moments of extinction because of the decisions they had made, just seemed unreal to me.
Looking back, shouldn't legislation like this have been attached to the first installment of the Troubled Asset Relief Program?
Absolutely. Looking back, I just think none of us really comprehended that this culture was so calcified of entitled that multi-million dollar salaries are due, regardless of whether or not they perform. When all this started piling up - and I was having a conversation with someone this morning - and they said: 'None of them should make more than the president.' And he was right. None of them should be making more than the president. So I walked down the hallway and said draft it and we went to the floor and introduced it today.
I think this at least sends the signal that the party is drawing to a close. If you take this bill along with some of the other things my other colleagues are doing, Sheldon Whitehouse is focusing on $40 billion of deferred compensation that is still on the books for these guys and these companies. That needs to be wiped out.
How closely did you coordinate with the president on this bill?
I have not talked to the president specifically about it. Obviously I would like them to embrace this concept and notion. It was the White House who got them to stop buying the jet. I think the president had a very genuine moment yesterday when he lashed out at these executives in regards to the bonuses being paid under these circumstances.... So, I think he is as insulted on behalf of the taxpayers as I am. Whether he chooses to embrace this vehicle or he [gives responsibility] to someone in terms of the authority of the Secretary of the Treasury, I'm not sure.
You are tackling the income disparity issue from one end. How about the other? What kind of labor priorities should Congress consider and where does the Employee Free Choice Act stand on the congressional schedule?
I asked yesterday a member of leadership: 'How soon are we going to get [EFCA] up [for a vote]?' I think there is a growing sense that we need to get it up on the calendar sooner rather than later. But leadership hasn't said clearly when they are going to bring it up. I think there is just as much support for it on our side as there has always been. And I think there are a few members on the other side who would be supportive. So I think it has got a really decent chance of passing. It is obviously something that a lot of us think is important in terms of reinvigorating the middle class.
Care to name some of those Republicans who might cross over?
I don't want to commit to where anyone is because it would tip people off and the business community would descend on them like locust. So I would rather do it quietly, under the fold, without outing them.
On a broader level of restructuring the economy, the stimulus bill passed the House a few days ago without any Republican support. The president obviously reached out in an effort to compromise, but then you had people like Eric Cantor accusing the White House of partisanship. What happened here?
I think that there have been some mistakes made. From my perspective there have been mistakes made on the stimulus bill. There has been such a starvation diet for some of these programs that the appropriators got a little over anxious in the House. They probably did some things they shouldn't have...
We do need to look at the safety net side of the stimulus bill that can get into the economy quickly. But we can't right every wrong in terms of programs we support in the stimulus bill. And the other thing is, whether it is the National Endowment of the Arts or some of the STD funding or contraceptive funding, all we did was just tee up ammunition for the other side to tear this thing down. And I would like to think we are smarter than that. I'm hopeful on the Senate side we will be smarter than that.
We will pull some of this stuff out that is not stimulative and we will have safety net in there that will get into the economy quickly, because that is what these tax breaks do, and the unemployment insurance benefits and the food stamps. People need them and they'll spend it, and it will go into the economy quickly. But I think we have to remain very focused on how we are creating jobs in this thing. And I am hoping we will find that middle ground.