Henry Paulson's Pay Cut

Here is a letter I wrote to the editor of The Economist recently (published on April 14, 2011), regarding Hank Paulson’s “pay cut”

SIR – You mentioned that Hank Paulson took a 99.5% pay cut. That may be true from a nominal perspective, however Mr Paulson saved $50m in capital-gains taxes because of a law passed by George Bush senior that exempts capital gains incurred by those selling investments to move into the public sector. He was also able to dump all securities shortly before the financial system imploded (without regulators or shareholders causing a fuss), so it was more like early retirement on the back of an extremely prudent financial decision than a pay cut.

Marc Gayle
Kingston, Jamaica