Funny how this story is not a lead on CNBC. It's hard to think of another industry that can perform so poorly yet still be paid so well. Congress really has to step it up and crack down because as I've said before, the bonus money at the top is excessive but this mentality runs deep. For people who are bringing real business and real profit, sure, make as much money as possible. I firmly believe in rewarding success with money (if that is what makes someone tick) but rewarding people for failure - in this case we're talking about trillions of dollars of bad business around the world - is not saying much about our economic system or its chances of long term success.
Let Wall Street make their own damned money the way everyone else works and quit sponging off of taxpayers. It would be nice if Waxman would invite Wall Street to Congress *now* and have an open discussion about this and not in January after the cash has been handed out. Let's have a very public debate about these payments and let the taxpayers - who know are investors in the banks - decide if these payments are fair.
Financial workers at Wall Street's top banks are to receive pay deals worth more than $70bn (£40bn), a substantial proportion of which is expected to be paid in discretionary bonuses, for their work so far this year - despite plunging the global financial system into its worst crisis since the 1929 stock market crash, the Guardian has learned.
Staff at six banks including Goldman Sachs and Citigroup are in line to pick up the payouts despite being the beneficiaries of a $700bn bail-out from the US government that has already prompted criticism. The government's cash has been poured in on the condition that excessive executive pay would be curbed.
Pay plans for bankers have been disclosed in recent corporate statements. Pressure on the US firms to review preparations for annual bonuses increased yesterday when Germany's Deutsche Bank said many of its leading traders would join Josef Ackermann, its chief executive, in waiving millions of euros in annual payouts.
The sums that continue to be spent by Wall Street firms on payroll, payoffs and, most controversially, bonuses appear to bear no relation to the losses incurred by investors in the banks. Shares in Citigroup and Goldman Sachs have declined by more than 45% since the start of the year. Merrill Lynch and Morgan Stanley have fallen by more than 60%. JP MorganChase fell 6.4% and Lehman Brothers has collapsed.
At one point last week the Morgan Stanley $10.7bn pay pot for the year to date was greater than the entire stock market value of the business. In effect, staff, on receiving their remuneration, could club together and buy the bank.
In the first nine months of the year Citigroup, which employs thousands of staff in the UK, accrued $25.9bn for salaries and bonuses, an increase on the previous year of 4%. Earlier this week the bank accepted a $25bn investment by the US government as part of its bail-out plan.
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