McCaskill slams Wall Street's use of bailout money

KANSAS CITY — Sen. Claire McCaskill chastised Wall Street executives who gave out $18.4 billion in bonuses after accepting a federal bailout and proposed limits on some of their salaries.

"They don't get it," McCaskill said Friday on the U.S. Senate floor. "These people are idiots."

McCaskill's proposal would force companies taking federal bailout money to limit compensation for any employee to $400,000 a year. The compensation cap would cover salary, bonuses and stock options.

This week's estimate of $18.4 billion in bonuses for Wall Street executives came from the New York state comptroller, who could not estimate how much of that money — if any — came from taxpayers.

President Obama on Thursday called bankers "shameful" for giving themselves bonuses, after the federal government bailed them out.

But critics called McCaskill's plan shortsighted. Some of the bailout money also included more modest bonuses for workers from human resources representatives to secretaries. Many of the bonuses were contractually guaranteed before the banks' troubles escalated.

"It's a stupid idea," said Woody Cozad, a lobbyist, commentator and Republican from Missouri. "I don't defend anyone who's at those companies now, but if they all need to be replaced, you're not going to replace them with anybody very good for $400,000."

So far, Missouri banks have received $641 million under the Troubled Assets Relief Program and Kansas banks have received $77 million.

McCaskill's legislation, called the Cap Executive Officer Pay Act, was referred to a Senate committee. Under the measure, firms could resume paying their executives whatever they want after the companies had repaid all their bailout money.