'Pay Czar' to Rein In Bonuses

The Obama administration decided on Tuesday to allow 10 large banks, including American Express, J.P. Morgan, Morgan Stanley, and Goldman Sachs, to repay their $68.3 billion in TARP money. What’s in line for the other banks? According to The Wall Street Journal, Obama will appoint a “pay czar” to monitor the compensation practices of those banks still on the government’s lifeline. However, the administration is dropping its plan to cap salaries and will only seek to limit bonuses. And those banks that have already repaid TARP are not exactly out from under the government’s watchful eye: “Treasury Secretary Timothy Geithner is expected to push all firms—not just those receiving funds from the government's Troubled Asset Relief Program—to more closely tie incentive compensation to long-term performance by paying employees in restricted stock, rather than cash.”