The New York Times > Business > 'Unfettered Authority' That Led to Overreaching at the Big Board: "Mr. Grasso had a major influence on who was named to the board. He also 'had the unfettered authority to select http://www.blogger.com/img/gl.link.gifwhich board members served on the compensation committee and, likewise, to select the committee chair.' As a result, 'Grasso hand-selected the members of the committee charged with reviewing and recommending his yearly compensation.'"
Who was picked? The report says that Mr. Grasso chose directors who were themselves highly paid, and thus less likely to be surprised by big payments. And he chose people "with whom he had or developed friendships or personal relationships."
One director, not identified by Mr. Webb, was said to have told Mr. Grasso that he had little time to devote to the exchange, and "was assured by Grasso that he did not have to attend all the meetings and it would not be that much work." The director was put on the compensation committee.
The committee often did little work as Mr. Grasso built up a web of interlocking payments under a bewildering set of management compensation plans that reinforced each other in ways the board members often did not understand. Directors asserted that they relied on a consultant who later said that he had never endorsed the big payouts and had objected to them in 2001.
In some cases, board committee minutes appear to have misrepresented what occurred at meetings, the report said.
Our concern is less with the legality of the compensation plan than with the morality of it. It is fine for the Republicans, like their counterparts at the New York Stock Exchange, to run our national political system like a ten year old boy's utopia where a mother is never allowed to check whether you've cleaned up your room.
House GOP Leaders Name Loyalist to Replace Ethics Chief
House Republican leaders tightened their control over the ethics committee yesterday by ousting its independent-minded chairman, appointing a replacement who is close to them and adding two new members who donated to the legal defense fund of House Majority Leader Tom DeLay (R-Tex.).
Republican officials have spent months taking steps to ensure DeLay's political survival in case he is indicted by a Texas grand jury investigating political fundraising, and House leadership aides said they needed to have the ethics committee controlled by lawmakers they can trust.
Politics is one thing. When we talk about Pudentilla's retirement, however, we are talking serious matters. We would prefer that our retirement security was entrusted to people, who like us are not "less likely to be surprised by big payments" and will perhaps understand the importance Social Security plays in the retirement plans of most Americans. It would help too, if the people who oversaw our retirement investments did not, like House Republicans, purge those like Rep. Hefly, who believe their job is "to protect the integrity of the institution."
Il Ducetto, who will not rely on Social Security for a significant portion of his retirement, and who does not, we infer, socialize regularly with those who will ("What we have here are the haves and the have-mores! Some people would call you elite- I call you my base."), last night made a statement which we would have characterized as breathtakingly audicious if we had not already grown accustomed to Il Ducetto's capacity for mendacity:
Your money will grow, over time, at a greater rate than anything the current system can deliver, and your account will provide money for retirement over and above the check you will receive from Social Security. [emphasis supplied]
We shall decline to comment on the fact that even as Il Ducetto whispers promises to those of us who will rely on Social Security for a dignified retirement, his aides were informing reporters (off the record, of course) that the government would insist on keeping part of the profits investors earned in "personal" (a new "Red" definition of the term now means, "personal: belong to a person except for that portion which men like Tom DeLay claim for themselves, perhaps as tribute). Indeed, as Atrios explains, the senior aide is saying that while Il Ducetto promises her more than the current system can deliver, his anonymous senior aide is acknowledging that Pudentilla get 18% less than the benefits promised under current law. If we do nothing, Pudentilla will recieve all the benefits promised under current law if Congress does nothing to Social Security. If Pudentilla weren't so bent on praeteritio, she would speculate as to the support Il Ducetto's plan will recieve from the 40-55 year cohorot.
Instead, engaging in the delightfully creative exercise of taking Il Ducetto at his word, we wonder whether any of the investors in Arbusto or Harken would feel great confidence in Il Ducetto's guarantee (cost free to him) of a "sure thing" investment in the stock market. Perhaps, since others always made good Il Ducetto's wretched business losses, he sincerely believes investment in the stock market is a sure thing. The rest of us, however, who wait with baited breath no longer (for even we humble proles must breathe) for the criminal conviction of the host of business men who destroyed the savings of investors in Enron, Worldcom, etc. (noting that the only conviction they have managed is that famous "blue" lady executive, Martha Stewart), are less sanguine about Il Ducetto's reliance on the "free market."
As far as those of us who are rather "likely to be surprised by big payments," can tell, Il Ducetto's market, like his Congress, is a con game run by ethically challenged white guys whose moral code includes no place for personal or institutional responsibility or accountability. It is no place to find retirement security.
