Executive Excess 2016: The Wall Street CEO Bonus Loophole
This 23rd annual report reveals how taxpayers are subsidizing financial crisis windfalls.
This report is the first to calculate how much taxpayers have been subsidizing executive bonuses at the nation’s largest banks.
The study focuses on a 1993 Clinton administration reform that was intended to rein in runaway CEO pay by capping the tax deductibility of executive compensation at $1 million. But the new rule included a huge loophole for stock options and other “performance” pay. As a result, the more corporations hand out in executive bonuses, the lower their tax bill. This perverse incentive for excessive compensation has been a major factor in the explosion of CEO pay.
The financial bailout program closed this loophole for recipients, but only until Read the rest of this entry »