President Obama has had a rough few weeks. His proposed health care overhaul is in trouble and voters are saying he’s not doing enough to improve the economy, according to a new poll conducted by Republican researcher Glen Bolger and Democrat Stan Greenberg.
The one bright spot for Obama is his proposed “TARP tax.”
Bolger’s and Greenberg’s results showed that the fee on banks to pay for the financial bail out has solid popular support. The poll of 800 likely voters showed that 57% of respondents supported the tax when the pollster described it as a “responsibility fee” that will “discourage big bonus payouts and ensure the big banks that caused the crisis pay for the bailout.” But 39% of respondents oppose the tax when pollsters said it would cause the banks to pass along the costs to consumers and reduce lending to small businesses.
Bolger told National Public Radio he thinks his fellow Republicans could be hurt if they take up the bankers’ cause in the 2010 midterm elections.
“I think there is going to be a lot of pressure on them,” Bolger says, “because the push-back message, it’s nowhere near as strong as the Democrat attack. The banks are in a tough spot on winning this policy fight.”
Perhaps that helps explain some of the sentiments expressed by banking lobbyists in a Bloomberg article today….
“We just want to sit at the table and have a productive conversation about the kinds of reforms needed to address the real causes of the recent crisis.” said Rob Nichols, head of the banking trade group, the Financial Services Forum.
It is difficult to think that an industry that spent more money on lobbying in 2008 than any other industry expect health care companies would just lie down and swallow the TARP tax.
Still, the polls show that Democrats face an uphill battle in November. Survey respondents said they would favor an un-named Republican candidate over a Democrat by five percentage points a hypothetical Congressional race.
Wall Street Pay: Banks Devise Ways To Skirt Compensation Cuts
Don't shed a tear for seemingly cash-strapped Wall Street workers this year. This year's bonus season may, in fact, be surprisingly rewarding. Banks have been working to devise ways to boost overall employee compensation while maintaining the appearance of pay cuts, the Wall Street Journal reports.
Goldman Sachs, which posted a $13 billion profit for 2009 and has been under intense scrutiny all year, has reportedly already announced bonus amounts to partners, directors, analysts and vice presidents. Many Goldman employees, according to the Business Insider, are actually quite thrilled about their compensation structure, which includes larger stock awards, smaller cash payouts -- and, for some, more take-home pay. Here's John Carney:
Partners this week were told that their 2009 bonus will be paid 60% in stock that will vest over 3 years. Several partners we spoke to seemed happy to get Goldman stock instead of cash.
"Cash loses value over time, while Goldman stock gains," one partner said.
Goldman Sachs, Royal Bank of Scotland and UBS AG have also offered some employees loans on the company dime. At other banks, including Citigroup and Bank of America, some workers are reportedly set to receive stock grants that can be sold "within months," the WSJ notes. These fast-track stock options run counter to much of the underlying principles behind reforming Wall Street pay. A host of critics and economists have called for tying bank pay to long-term performance, rather than short-term gains.
Here's more from the WSJ:
Some banks are easing the restrictions on restricted stock, making the shares nearly as liquid as cash. At Bank of America, restricted stock being distributed at the investment-banking unit can be sold as soon as August. Citigroup is issuing $1.7 billion of stock units that employees can sell in April.
Banking regulators globally have encouraged banks to make their pay deferral periods longer, at least a year or more.
Of course, flooding the financial markets with thousands of new shares of bank stocks is bound to have its consequences. As the WSJ reported recently, banks' shift to doling out bigger portions of pay in stock could hurt Main Street investors: "Some analysts estimate the shift to more stock could increase the number of shares outstanding at such companies by as much as 4%. All those new shares would dilute per-share earnings."