Lame Defense for $18.4 Billion in Wall Street Bonuses
|February 3, 2009||Posted by Roshawn Watson under Uncategorized||
It is tremendously disappointing to hear of companies taking bailout funds and then using our money to pay for bonuses. After all, where is the bailout for the typical American worker whose tax dollars are being used to support these bonuses? Even without a bonus, the average Wall Street worker still makes 3-4 times what the average American makes, yet in the midst of a deep recession, Wall Street employees are taking home a whopping $18.4 billion in bonuses. In fact, according to MSN money bonusfest 2008 was the 6th largest payout on record even though Wall Street was a disaster by almost any estimate. President Obama called it the “height of irresponsibility” and “shameful,” and I agree. What I find even more nauseating is the lame defense put forth by the recipients (see video below) and the fact that
46% of Wall Street workers were dissatified with their bonuses.
One argument put forth is that since the majority of wall street employees’ pay comes from bonuses, slashing bonuses is like forcing them to take a huge pay cut.
One Wall Street worker quipped, “My bonus is ‘shameful’ — but I worked hard to get it”
Although I can appreciate that few people celebrate a decrease in salary, in some cases it may be warranted. For example, in cases where the institution where you work for is struggling so badly that they need government aid to stay afloat, sacrifices including loss bonuses are perfectly reasonable. Additionally, millions across the country have had to taste the effects of a down economy including a decrease in salary. With unemployment at 7.6 percent and underemployment also on the rise, there are an abundance of families who have suffered a decline in income. These guys would survive.
Perhaps the most insulting argument is that Wall Street employees are being used as scapegoats for the world’s financial problems. Now, I would never argue that some American consumers did not over-extend themselves into a big financial pickle. About 40 percent of American homeowners are financially over-extended, and it took us a very long time to finally save. We have a culture of debt, and the current financial mess is the result of overly optimistic or uninformed borrowers and dishonorable or uninformed lenders, amongst other culprits. However, placing blame does not negate the fact that hemorrhaging companies are spending billions of bailout money on bonuses. Perhaps no amount of moral posturing and rationalizing will justify that. There is no good defense when it is just plain wrong.
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Copyright 2012, Roshawn Watson, Pharm.D., Ph.D. All Rights Reserved.