Bailout? Or Rip Off?

This one should make taxpayers very, very, very angry. The New York Times is reporting that despite 2008 being a disaster for the US financial sector, despite huge infusions of cash to banks and other Wall Street firms, those financial institutions paid out some $18.4 BILLION in bonuses to Wall Street workers. This is shameless – and shameful. Even institutions that got absolutely creamed last year paid out bonuses even while their balance sheets pulled a Titanic.

By almost any measure, 2008 was a complete disaster for Wall Street — except, that is, when the bonuses arrived.

Despite crippling losses, multibillion-dollar bailouts and the passing of some of the most prominent names in the business, employees at financial companies in New York, the now-diminished world capital of capital, collected an estimated $18.4 billion in bonuses for the year.

That was the sixth-largest haul on record, according to a report released Wednesday by the New York State comptroller.

While the payouts paled next to the riches of recent years, Wall Street workers still took home about as much as they did in 2004, when the Dow Jones industrial average was flying above 10,000, on its way to a record high.

Some bankers took home millions last year even as their employers lost billions.

While regulators say it is unclear if taxpayer money went to these folks, it is quite clear that taxpayer money certainly helped make sure these payments got made.

This is sickening.

Tell me what great performance warranted this kind of bonus money? The fabulous condition of Wall Street? The outstanding profitability? The huge boost to the American economy?

Or did they get bonuses for successfully milking the American taxpayer?

Now you know why financial types were the largest, single group of contributors to the Obama inauguration festivities.

Now you know why you should be suspicious of the passage of the “stimulus” bill last night by the Democrats in the House. (And only by the Democrats). I suspect you also know why the Republicans – and 11 Democrats – managed to have enough gumption to refuse to vote for that pork-laden bill.

Get mad, folks. We’re being screwed.

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5 Responses to Bailout? Or Rip Off?

  1. Thomas Pfau says:

    If they keep this up they’ll be inviting legislation to limit executive bonuses. If they keep this up, I might just change my mind and support that legislation.

  2. martian says:

    And we’re going to keep getting screwe as long as the Democrats are the majority. What’s worse is that the general public will never hear about it because it will never be reported in the MSM.

  3. Andy T says:

    The numbers are large, but not everyone got them. Part of the problem with these bonuses is that much of them are either guaranteed or are deferred compensation. Many of the people on Wall Street who do the investment banking work get paid over the course of the year roughly 1/4 of what they ‘expect’ to make in an average year. The rest comes in bonus. While the firm lost money, there group may not. The bonuses are allocated by group, regrettably. To use the Citi financial supermarket, even thought the store lost money because of the bakery, the produce department did well so those managers are entitled to their bonus. In a business where you can’t afford to lose your top produces, sometimes there is an incongruous result.

    That said, folks like Thain who are responsible for the store should not get bonuses. Ironically, one of the smaller investment banks that I am very familiar with, that is still independent, the Managing Directors, or Partners as they used to be known, did not take bonuses because the firm lost money. However, they did pay more modest bonuses to those below them because they met their performance metrics.

  4. Mockingbird says:

    What AndyT said.

  5. sam says:

    Like the Citigroup corporate jet fiasco, this is another example of many of these executives being tone deaf. This isn’t the way to treat the long-suffering taxpayers who are contributing to the bailouts and will never see anything like the bonuses these people are receiving. It is really sad.

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