All Dollars Are Green
Feb 15, 2009
Just the other day a senior corporate executive reminded us why much of the public thinks of corporate executives as not only greedy, but also contemptuous of the public’s intelligence.
I’m referring to Tony Wolfe, President and CEO of the ironically named Peoples Bank. The North Carolina-based bank is a recipient of $25.1 million in funds from the Troubled Asset Relief Program (TARP), and like many other banks has been questioned about the appropriateness of both receiving TARP funds and paying out management bonuses. Wolfe’s reply was to assure us that none of the TARP funds would be used to pay the bonuses!!! No, I am not making this up.
Let’s for the moment leave aside whether legislation limiting executive pay for companies receiving federal “bailout” money is sound public policy. Or whether those ceilings will achieve the desired public policy objectives, regardless of how pointless those objectives might be. OK?
Wolfe’s remark is just astonishing. Does he understand money? Is he actually trying to say that if you have $30 gazillion in the bank, and you spend $1 gazillion on something, you can actually identify which of the sources of the $30 gazillion that $1 gazillion did, or didn’t, come from? Does Wolfe also plan to deny that even if the TARP funds won’t be used to pay the bonuses, the TARP funds made it possible for Peoples Bank to pay the bonuses with the other money?
The problem with remarks like this is that almost everyone sees through them. The end result is not only a lame defense, but damage to the speaker’s credibility.
“Painting with Numbers” is my effort to get people talking about financial statements and other numbers in ways that we can all understand. I welcome your interest and your feedback.
I’m referring to Tony Wolfe, President and CEO of the ironically named Peoples Bank. The North Carolina-based bank is a recipient of $25.1 million in funds from the Troubled Asset Relief Program (TARP), and like many other banks has been questioned about the appropriateness of both receiving TARP funds and paying out management bonuses. Wolfe’s reply was to assure us that none of the TARP funds would be used to pay the bonuses!!! No, I am not making this up.
Let’s for the moment leave aside whether legislation limiting executive pay for companies receiving federal “bailout” money is sound public policy. Or whether those ceilings will achieve the desired public policy objectives, regardless of how pointless those objectives might be. OK?
Wolfe’s remark is just astonishing. Does he understand money? Is he actually trying to say that if you have $30 gazillion in the bank, and you spend $1 gazillion on something, you can actually identify which of the sources of the $30 gazillion that $1 gazillion did, or didn’t, come from? Does Wolfe also plan to deny that even if the TARP funds won’t be used to pay the bonuses, the TARP funds made it possible for Peoples Bank to pay the bonuses with the other money?
The problem with remarks like this is that almost everyone sees through them. The end result is not only a lame defense, but damage to the speaker’s credibility.
“Painting with Numbers” is my effort to get people talking about financial statements and other numbers in ways that we can all understand. I welcome your interest and your feedback.
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