Government Takeover: Citigroup Asks Obama Administration For Permission To Pay Employees

Yes, it’s bonuses again. And I know it’s en vogue these days to think that bonuses for executives – even those who do a good job – are evil. But if Citi is to ever return to a profitable situation independent of the government (though I certainly don’t think that’s what Obama has in mind), shouldn’t they be able to compensate their employees appropriately before they flee the company to places where their performance bonuses aren’t subject to scrutiny by the federal government?

Citigroup Inc., soon to be one-third owned by the U.S. government, is asking the Treasury for permission to pay special bonuses to many key employees, according to people familiar with the matter.
The request comes as Citigroup is grappling with broad government pay restrictions that could break apart its legendary energy-trading unit. People at that unit, Phibro, are threatening to leave because of pay caps tied to the U.S. bailout of Citigroup. Phibro has been the source of hundreds of millions of dollars in profits for the bank, and has paid out hefty compensation, including a roughly $100 million windfall last year for the unit’s leader, Andrew Hall. …
Citigroup is trying to get U.S. approval for special bonuses for many of its employees. In a meeting earlier this month with Treasury Secretary Timothy Geithner, Citigroup CEO Vikram Pandit made the case for the stock-based bonuses. Executives are describing the bonuses as “retention” awards to perk up demoralized employees who the company worries are vulnerable to poaching by rival firms, people familiar with the matter said.
A person familiar with Mr. Geithner’s thinking said the Treasury hadn’t made a decision on whether to allow the bonuses. It is unclear how much Citigroup would pay out in bonuses if the government approved the move. A Citigroup spokesman declined to comment on details of the proposed compensation plans.

In what is supposed to be a free country like America, the spectacle of a business having to ask the government for permission to pay its employees is a little sickening. It’s exactly what the liberals want, of course, which is near total control over the economy. But it has little to do with freedom.