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View Full Version : CEO Bankruptcy Bonuses - The Young Turks




DamianTV
01-28-2012, 10:24 PM
http://www.youtube.com/watch?v=lDIVXuv_UNY&feature=player_embedded

Travlyr
01-28-2012, 11:09 PM
The system is rigged against us.

silverhandorder
01-29-2012, 12:30 AM
CEO is an employe. If he negotiated for such a pay the only people to blame for this are share holders for allowing this to happen. This is what happens when corporate raiders are persecuted. Corporate raiders look for these systemic imbalances and correct them at a hefty profit to them selves.

dillo
01-29-2012, 02:31 AM
I don't understand how bankruptcy works, does the government pay them this money that they then give out the bonuses with.

DamianTV
01-29-2012, 06:21 AM
It doesnt matter how it works because the way the system works benefits the top 1% at the expense of everyone else, like people who need jobs. All that needs to be understood is that this comes from a Dishonest Money System.

Diurdi
01-29-2012, 06:33 AM
There are a couple possible scenarios.

First is the one where the creditors make an agreement to give bonuses of the people in charge if they manage to liquidate the company according to specific goals. Paying 20 million to the leadership to for example be able to push out 400 million more out of the liquidation.

The second scenario is where the leadership is able to assign themselves bonuses before the bankrupcy and showing the middle-finger to the creditors.

The bottom line is though that just because CEO's got bonuses at the bankrupcy does not necessarily mean it's wrong at all.

WilliamC
01-29-2012, 07:03 AM
Not trying to defend our fascist system but in a free-market if a CEO manages a company going into bankruptcy and is able to save a billion dollars, for instance, then that could be worth a multi-million dollar bonus.

Bad sitiations can be ameliorated, and there should be incentives for doing so.

NidStyles
01-29-2012, 07:20 AM
Not trying to defend our fascist system but in a free-market if a CEO manages a company going into bankruptcy and is able to save a billion dollars, for instance, then that could be worth a multi-million dollar bonus.

Bad sitiations can be ameliorated, and there should be incentives for doing so.

The problem with this assertion is that Corporations are anti-thematic to a Free-Market.

In a Free-Market people are people, not Corporations are "people". Everyone is held accountable by their employees and consumers in a real Free-Market system. This whole situation got started when Corporations were enabled person-hood status and the laws that deflect responsibilities were lobbied out of existence by the newly formed Corporate "people". None of this would have happened if the generation that followed the old guy's that wrote the funny Constitution thing hadn't reneged on the limitations on Corporate Charters.

If one went back and examined the entire reasoning behind the Revolution, one would find out that the rebellion was primarily against the British Corporate rule of the colonies. The entire way the British system was structured during that period allowed for Corporate ownership of humans. That's also how that whole slavery thing got started in the first place as well. Oddly enough it wasn't based upon race at first, as the first registered slave owner in the US was Black.

Diurdi
01-29-2012, 07:30 AM
The problem with this assertion is that Corporations are anti-thematic to a Free-Market. Corporations are not anti-thematic to the free market. They're essential.

There is nothing wrong with the limited financial responsibility that the owners of a corporation have. The creditors know fully well that they're lending to a corporation.

NidStyles
01-29-2012, 07:34 AM
Corporations are not anti-thematic to the free market. They're essential.

There is nothing wrong with the limited financial responsibility that the owners of a corporation has.

A "Limited Financial Responsibility" company would be a Trust, not a corporation. Corporations are a completely different animal. A corporation is treated a sole individual under the law, and the people operating it are shielded from legal action against taken against the corporation. You can't sue the CEO of a Corporation, you can sue the CEO of a Trust.

If you are referring to an LLC, the language is misleading, as those are treated as a Trust by the law.

teacherone
01-29-2012, 07:40 AM
Limiting liability is essential in a modern economy.

I own a business and am incorporated. If clients or employees were able to sue a businessman and be awarded his personal assets I would have never started my business in the first place.

Who would?

Diurdi
01-29-2012, 07:42 AM
A "Limited Financial Responsibility" company would be a Trust, not a corporation. Corporations are a completely different animal. A corporation is treated a sole individual under the law, and the people operating it are shielded from legal action against taken against the corporation. You can't sue the CEO of a Corporation, you can sue the CEO of a Trust.

If you are referring to an LLC, the language is misleading, as those are treated as a Trust by the law. And how is this relevant to the topic of CEO bonuses?

Now, I'm obviously not well versed in US corporate law, but here in Finland there's a limit to what this "shield" extends to. You can't defraud people and blame it on your corporation.

Travlyr
01-29-2012, 07:44 AM
I don't understand how bankruptcy works, does the government pay them this money that they then give out the bonuses with.
I don't understand it either. If they have $20 million, then how are they bankrupt?

donnay
01-29-2012, 08:04 AM
This is crony capitalism at it's finest! :mad: The CEO's are bank robbers in a $1500.00 suit. This type situation is no different than an organized crime syndicate. These people should be behind bars, not basking in the sunshine on the beaches of Cayman Island!

NidStyles
01-29-2012, 08:04 AM
^^^ You got it wrong. I own a $1500 suit. They wear suit's that go for $20K and up. A decent suit will cost $1500, but a really nice one goes for $10K and up.


I don't understand it either. If they have $20 million, then how are they bankrupt?

That $20 Million came from firing a bunch of people and the sale of the Company's assets. Bankruptcies are essentially liquidations of the Company until it can cover it's debt. The company doesn't cease to exist unless the debts roll over higher than the value of the assets they hold. Essentially, it's not that the company is broke, it's just that they are insolvent, or do not have the credit line to extend or the currency available to cover their debt.


Limiting liability is essential in a modern economy.

I own a business and am incorporated. If clients or employees were able to sue a businessman and be awarded his personal assets I would have never started my business in the first place.

Who would?

I have an LLC. A Trust is essentially the same thing except for the way taxes are applied, and how Capital Gains work when transferring control of the organization or company.

Incorporated is a completely different animal from either of those. You could have accomplished the same thing with either a Trust or LLC though, and not have been under the tax codes that are the worst.


And how is this relevant to the topic of CEO bonuses?

Now, I'm obviously not well versed in US corporate law, but here in Finland there's a limit to what this "shield" extends to. You can't defraud people and blame it on your corporation.

CEO's are able to do this sort of action by shielding themselves behind lawyers, and Corporate law that has been created at their behest. Under a Trust the people can still be held accountable for misuse of funds and defrauding of individuals. Under an INC the CEO can not be held accountable for decisions they have made to create situations of fraudulence or misuse of funds. Only through class-action suits can anyone ever take on a Corporation, and even then you can not go after the Individual responsible. Only the Federal Government has the authority to do so, and they only do it when one of their own has been defrauded.

US Corporate law is a nightmare.

Diurdi
01-29-2012, 08:10 AM
US Corporate law is a nightmare. I don't have the time or capacity to check right now whether what you said above is actually true or not, but how does some scewed legislation suddenly make the concept of a corporation "anti-thematic" to Free Markets?

osan
01-29-2012, 09:19 AM
Not trying to defend our fascist system but in a free-market if a CEO manages a company going into bankruptcy and is able to save a billion dollars, for instance, then that could be worth a multi-million dollar bonus.

Bad sitiations can be ameliorated, and there should be incentives for doing so.

You make a strong point, but too broadly.

When the problems in question are not directly attributable to those ameliorating, you are on the money. But when someone screws the pooch, then takes measures to minimize the devastation I see no reason to later reward him. He should be taken to the wood shed. His ameliorations may be regarded as mitigating factors in establishing a just punishment, but punishment should still be meted out per the nature and degree of the offense and by no means should such a person be raking in countless millions in bonuses. That is simply ridiculous.

angelatc
01-29-2012, 01:24 PM
CEO is an employe. If he negotiated for such a pay the only people to blame for this are share holders for allowing this to happen. This is what happens when corporate raiders are persecuted. Corporate raiders look for these systemic imbalances and correct them at a hefty profit to them selves.

Yep. These days, the people around here seem to forget that it's not their money. The class warfare is repulsive.

angelatc
01-29-2012, 01:24 PM
You make a strong point, but too broadly.

When the problems in question are not directly attributable to those ameliorating, you are on the money. But when someone screws the pooch, then takes measures to minimize the devastation I see no reason to later reward him. He should be taken to the wood shed. His ameliorations may be regarded as mitigating factors in establishing a just punishment, but punishment should still be meted out per the nature and degree of the offense and by no means should such a person be raking in countless millions in bonuses. That is simply ridiculous.


It's not your money.

WilliamC
01-29-2012, 01:29 PM
You make a strong point, but too broadly.

When the problems in question are not directly attributable to those ameliorating, you are on the money. But when someone screws the pooch, then takes measures to minimize the devastation I see no reason to later reward him. He should be taken to the wood shed. His ameliorations may be regarded as mitigating factors in establishing a just punishment, but punishment should still be meted out per the nature and degree of the offense and by no means should such a person be raking in countless millions in bonuses. That is simply ridiculous.

I agree that those who caused the problems shouldn't be rewarded, I was more thinking of a hypothetical situation where a CEO takes over a failing corporation and guides it through bankruptcy. If that CEO can somehow reduce the damage done that is worth rewarding.

But the entire argument of corporate law and what constitutes a legitimate corporation is well beyond the scope of my limited argument.

seapilot
01-29-2012, 01:58 PM
It's not your money.

Unless that corporation is bailed out at taxpayers expense. GM, JPMorgan, AIG etc.