Fire Them All! Wall Street Bonehead Bonuses

A PR rant for you…

OK, I’ve reached my limit! When will these “bigwigs” get it? The number one rule of marketing is “Perception is Reality.” It doesn’t matter whether it’s right or not, people will respond to their own perceptions far more than to facts.

Being a Libra and a liberal (yes, there are liberals who run businesses and believe — mostly — in free market principles), I tend to try and see “all sides” of every issue. Makes it difficult to make a decision, especially since my wife is the same.

As evidence, here is a transcript of a decision making process at our house…

Me: Honey, you want to go to a movie today?

Wife: If that’s what you want. Do you want to see a movie?

Me: Only if you do. I thought you might enjoy it.

Wife: If you’d enjoy it, I’d be willing to go.

Me: I don’t want to go unless you really want to to go to.

Wife: That’s kind of you. I’m open to what you want to do.

Enough to make your head explodePainful, very painful when we make decisions around here. Can make your head explode.

So, where was I?

Oh yes, I’ve been gone a little while due to a death in the family. However, even the grief I felt was not enough to tamp down my anger when I heard that that they gave almost $20 Billion (yeah, with a “B,” not an “M”) in bonuses to Wall Street employees! That’s hard enough to relate to; but it gets worse. It was with our TARP money! But wait, there’s more! Some of the unlucky recipients of all that largesse were disapointed that it wasn’t more!

“I feel like I got a doorman’s tip, compared to what I got in previous years,” said a 30-something investment banking associate at Citigroup’s offices in Lower Manhattan. (from a NY Times article)

If that’s a doorman’s tip, sign me up! Life’s tough when you’re a spoiled millionaire isn’t it?

This is not a class-warfare rant. I am not against the accumulation of wealth. I would love to have a great deal of it myself. However, the arrogant, pompous, presumptuous attitude of Wall Street leaves me flat footed, mouth-agape at how out of touch they are with the problems surrounding them. I feel like Howard Beele (Peter Finch) in the movie Network.

My rant about the automakers flying in on private jets simply pales compared to this. Even the usually cool president showed his rough edges.

On CNN, Rudy Giuliani, the man who — in his failed presidential bid — paid more for one delegate than any other candidate in history (showing his own particular brand of economic prowess)  comes to the defense of these bonuses:

“I remember when I was mayor, one of the ways in which you determined New York City’s budget, tax revenues, was Wall Street bonuses. It does have a reverse effect on the economy, if you somehow take that bonus out of the economy. It really will create unemployment. It means less spending in restaurants, less spending in department stores. So everything has an impact. Wall Street had a billion, two billion in bonuses, city had a deficit. Wall Street had 15 to 20 billion, New York City had a 2, 3 billion surplus. And it’s because that money gets spent.”

Of course, one could argue that the economy would improve equally well by handing out that same amount of money via jobs to lots of people.

Do the math

According to the US Census Bureau, the median household income was $48,200 in 2006. If we divide $18.4B by that amount, we find that the same amount of money would take care of approximately 190,000 households for a full two years, probably enough time to get them through this stinkin’ economy. Rudy “I’m against welfare” is really saying that it would hurt the bottom line of the upscale establishments, his friends and buddies. How ’bout we help some of the middle class?

It boils down to one thing: accountability

Dow Jones high was October 9, 2007 at 14,164.53. As of this date, it is sitting at 8,000, a drop of about 6,164 points, down approximately 45% from its high (and we’re still not necessarily done). If — and that’s a big “if”– this is the bottom, it will be the 7th worse stock market fall in history. (see the top 10)  Yet, according to the New York State comptroller, the amount of bonuses paid out are the sixth highest on record! (click here for a chart of Wall Street bonuses).

A particularly egregious example

AIG, who took billions from the TARP program has given its employees $1 billion worth of what are called “retention bonuses,” saying that  they need to pay what the market will bear in order to hold on to these “plums” of money managers so they won’t go elsewhere. (Of course, with the the whole financial sector in ruins, one wonders where they could go?) Anyway, out of that $1B, $450 million goes to about 400 employees, an average of over $1,000,000 per. Ironically (or should I say, “unbelievably”), these are the same guys and gals who worked in the division that helped melt down our entire financial system. Heck of a job guys! Glad to have you on board. For your next job, maybe we’ll turn you loose on ruining the environment.

My response?

Don't let the screen door hit you on the way out.
Don’t let the screen door hit you on the way out.

Let ’em all go! Fire the lot of them. If they’re unhappy with their pittance of a bonus, let ’em find some real work in the real world. After all, they don’t seem to be doing such a bang-up job, do they?  I don’t care that bonuses are down on the average. It is a crime to allow people who ruined their business, destroyed the retirement funds of countless Americans, and helped bring our whole economy to its knees;  to benefit from their ineptitude, greed, and corruption. It is a moral disgrace!

Some say, “We can’t regulate bonuses. It’s a private affair.” To those, I say, “when you take my taxpayer dollars, you gave up your privacy. Don’t want my nose in your business? Don’t take my money. I promise I won’t be offended.”

Besides, there a whole lot of people who could do the job just as poorly at 1/10 the pay. I’m even willing to give it a shot, and I bet I couldn’t do any worse.

OK, thank you for listening. I feel so much better now.

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~ by scottqmarcus on January 31, 2009.

One Response to “Fire Them All! Wall Street Bonehead Bonuses”

  1. A doormat?! A doormat?!

    Really, a doormat?!

    That’s the richest doormat I’ve ever heard of.

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