By Silla Brush - 01/13/10 05:25 PM EST
Rep. Barney Frank (D-Mass.) is mounting a new effort to limit executive compensation as Wall Street prepares this month to pay out huge bonuses.
Frank, chairman of the House Financial Services Committee, said he is looking at levying new taxes or fees on financial firms as well as ways to further empower shareholders to restrict pay.
Frank called a hearing for Jan. 22 and said he is not convinced by arguments that restrictions would hurt the industry by forcing well-paid employees to go elsewhere.
“I don't know where people would go for comparable salaries,” he said, saying that they might need to go to Mars to escape.
“There may be in some of these financial institutions people capable of playing Major League Baseball. I'm not aware of any.”
The heads of the nation’s biggest banks were testifying on Wednesday before the Financial Crisis Inquiry Commission, a panel set up by Congress to investigate the causes and consequences of the financial crisis.
Meanwhile, the Obama administration is moving to impose a new fee on banks to make up the deficit in the government's $700 billion bailout program for the industry.
The government has committed trillions of dollars in support
of the financial industry since 2008, and major Wall Street banks have seen
their stock values soar in the last year.
Frank said he supports a tax on the financial enterprises, possibly a tax on assets.
And he said he is looking at ways to expand a “say on pay” specifically for financial institutions.
“I don't want to talk about capping what they do,” he said.
He also said that he is looking at tax policies, including the marginal tax rate for high earners.
“I think we should be changing the marginal tax rate at that level of income,” Frank added.
Separately, Frank said he is “very skeptical” of a cap on credit card rates. Rep. Louise Slaughter (D-N.Y.) supports a 16 percent cap and has scheduled a hearing in the House Rules Committee on the issue. Frank said it makes more sense to set up a new government agency, the Consumer Financial Protection Agency, to regulate the credit card industry more broadly.