The pot of bonus money for the Wall Street tycoons, who will get their annual hand-out this month, is said to be 140 billion dollars this year. The Lords of Greed had another really good year, and they’re about to throw their annual party to hand out the checks.
Business as usual.
Oh, there are rumblings from the usual quarters about excess, and lefties and righties and tea-baggers are equally atwitter. On the left, Postmistress Arianna Huffington is suggesting that people take their money out of these giant financial institutions and put it in community banks.
On the right, politician Darrell Issa is poking around Toxic Timmy Geithner’s trash, trying to get the goods on the AIG bailout money, which went in the front door at AIG and out the back door to rescue banks that were AIG’s trading partners.
Never mind that was NOT what AIG was supposed to be doing with the bailout money.
And the tea-baggers? Generally speaking, they don’t have a problem with financial institutions that didn’t take bailout money handing out huge bonuses. Besides, the tea-baggers are in near-frenzy about their sold-out national convention in Nashville in a couple weeks, starring Mrs. Palin.
I shouldn’t poke fun at the tea-baggers. In a Wall Street Journal/NBC poll just a few weeks ago, the tea-bag movement was more highly rated among Americans than either major party. And most of the tea-baggers, like me, don’t believe in the concept “too big to fail”.
Goldmine Sachs, which spawned the current Obama financial brain trust, has about 18 billion in the bonus pot. In a transparent attempt to get “better press” about their bonus propensities, Goldmine said many of the highly-bonused employees give generously to charity, and the firm was contemplating a mandatory charity-donation program for the bonus-getters.
When the Wall Street Journal asked Goldmine about the charity-donation plan, the company could give no specifics. And when Time Magazine looked into the “charitable contributions” made by Goldmine employees in the past year, it found much of the money was “donated” to elite private schools.
So much for the “good PR”.
The British government has just finished levying a 50% tax on bank bonuses, but nothing of the sort is in the works here. But the Obama administration is considering a fee on banks to recover bailout money. New York Attorney General Andrew Cuomo is investigating the bonus practices of the 8 largest banks in his state. And the FDIC is considering a higher insurance rate for member banks that pay a large portion of their executive compensation in bonuses.
But it’s mostly just talk, and very little action.
When the bonuses are handed out, there’ll be 24 hours or so of negative press, and a bunch of manufactured outrage, but then things will be back to normal.