Posted by | February 12, 2012 12:48 | Filed under: Top Stories

by Stuart Shapiro

Gabriel Sherman wrote an article last week detailing how Wall Street is so upset at the Obama Administration for financial reform resulting lower bonuses.  Matt Taibbi decimates Sherman’s article, first by pointing out that uncertainty in Europe is far more to blame than financial regulation for lower bonuses and then arguing that even if the government was responsible, who cares?

The financial services industry went from having a 19 percent share of America’s corporate profits decades ago to having a 41 percent share in recent years. That doesn’t mean bankers ever represented anywhere near 41 percent of America’s labor value. It just means they’ve managed to make themselves horrifically overpaid relative to their counterparts in the rest of the economy.

A banker’s job is to be a prudent and dependable steward of other peoples’ money – being worthy of our trust in that area is the entire justification for their traditionally high compensation.

Yet these people have failed so spectacularly at that job in the last fifteen years that they’re lucky that God himself didn’t come down to earth at bonus time this year, angrily boot their asses out of those new condos, and command those Zagat-reading girlfriends of theirs to start getting acquainted with the McDonalds value meal lineup. They should be glad they’re still getting anything at all, not whining to New York magazine.

I always have to laugh when Republicans talk about “a culture of responsibility.”  It is poor people they want to make sure are responsible.  They are happy to let their large donors off the hook both by absolving them of responsibility for the worst economic situation since the Depression and blaming the government when their bonuses are six figures rather than seven.
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Copyright 2012 Liberaland
By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.