Tomoeh Murakami Tse
The Washington Post
As part of his battle against excessive pay packages, President Obama has taken aim at golden parachutes - those hefty lump sums that top executives cart away when they leave a job. But the practice is so entrenched that many of the president's own top recruits for White House positions are receiving generous severance packages from their previous employers.
While the lump sums pale in comparison to the startling amounts awarded to Wall Street executives in recent years, the payouts highlight the pervasiveness of the practice and further illustrate the growing pay disparity between ordinary citizens and the nation's elite.
Consider the new chairman of the Securities and Exchange Commission. Mary L. Schapiro reported that she is getting a lump-sum payment of $5 million to $25 million from the Financial Industry Regulatory Authority, the brokerage industry's self-regulating body she headed before joining the SEC last month. An SEC spokesman Friday said the package was worth $7.2 million.
| Herbert, PA |
February 10th, 2009 1:22 pm ET I don't get it – corporations pay a departing exec big $$$ for leaving? Are they so glad to get rid of them, no matter how much it may cost? |
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| amber |
February 10th, 2009 1:44 pm ET Duh, so they will be treated favorably in her new job. It may have even been part of her original package that they have to pay. |
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| Dan |
February 10th, 2009 3:14 pm ET I am now poor and live below the poverty level. Well I chose 2. Survival. Now Mr Obama is sending a stimulas check of $1000. My choice will be 4.None of the above. |
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| Annie Kate |
February 10th, 2009 9:37 pm ET From what I read in the related article most of these payments were deferred compensation – pay for work that had already been performed but not yet received. They defer the compensation primarily for tax advantage – you don't pay tax on money earned until the money is paid. The employee benefits by being able to defer that tax and the company benefited from the work already performed. It generally is part of their package when they are hired and most of the people are going to earn far less in the government than they did in their public jobs. While the deferred payments seem outrageous how many "good" performers would the government be able to attract to its positions without the deferred compensation the employees will get from their prior jobs? I don't condone or condemn this – I think each case would have to be looked at individually before judging. |
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