Thread: Bailout money being used to pay bonuses?

Found this article on the msn.com homepage at work.

As if the economic bailout by U.S. taxpayers isn't enough to make you sick to your stomach, new information has come to light that several banks are planning to pay billions of dollars in year-end bonuses from the bailout funds they received. Investigations are beginning into the nine banks that took in the first $125 billion -- the same $125 billion that was supposed to be used to unclog the credit system which was preventing banks from providing much needed funds for individuals and businesses.

There are many feathers in a ruffle over this and New York Attorney General Andrew Cuomo and several congressmen are furious that over $20 billion has already been earmarked as bonus funds for management and employees. Unbelievably, that is just the estimates from Goldman Sachs, Morgan Stanley and Merrill Lynch. There are six more banks that are also working on similar heists.

Here is their rationale for using that money: It is reported that the financial industry pays base salaries in the range of $80,000 to $600,000 and apparently that is simply not enough to keep some of the best and brightest working to keep their companies profitable. It seems that if they were paid only this meager amount, the company would risk mass defections. That would be a real problem...or would it?

Maybe it is time to peg annual bonuses to something meaningful like profitability. As I recall, not only are these the firms that have been losing money (as is evident by the need for a massive multi-billion dollar bailout) but they have also been shown to be the creators of securitization, derivatives, sub-prime mortgages and other toxic credit that is the root cause of this historic global economic catastrophe!

Maybe I am being too harsh? Perhaps management is entitled to hundreds of millions in bonuses for the hard work they do, day in and day out. You have to feel sorry for them as most have had to give up their private jets and instead fly in a cramped seat in first class. Surely most will now have to wonder how they will deal with the excess workload as they have had to fire thousands of employees. Also, they will need to use a good chunk of that money to rebuild their retirement plans as much of their wealth was tied up in their company's stock which, under their leadership, could be down more than 60% just this year alone.

No problem. The money will trickle down. :P

What, would you prefer that we DON'T give taxpayer money to the extremely wealthy? That'd be redistribution of wealth. What are you, a SOCIALIST?

People have been mistakenly throwing around the term "socialism" about Obama's tax plan lately yet here we have real socialism going on except this serves only the wealthy. The government owns a large part of the financial firms in this country now. The state owning means of production is a tenet of socialism. Yet, are the common people getting a break on their loan rates from the state owned financial firms? No. Are the greedy assholes who drove these businesses into the dirt getting huge bonuses paid for with our money? Yes. Yet, the outrage over this is minimal compared to this Joe The Plumber BS about calling Obama's plans to help the average American socialist. If you ask me, we should be more concerned about a government that is giving large sums of money to people that are already wealthy while average Americans are asking their children to put off going to college or going without insurance so they can keep their homes. You know, the ones they nearly lost because they got pushed into mortgages by these same firms that they ended up getting screwed over on.

Every government that ever was or ever will be, will be corrupt. No matter what we do or what we say, power will always corrupt you in some way.

This goes for big business as well.