January 30, 2009
Economics Department
Irresponsible and Shameful
Obama is displaying some of that weird anti-corporate attitude that has been worrying me:
President Barack Obama issued a withering critique Thursday of Wall Street corporate behavior, calling it "the height of irresponsibility" for employees to be paid more than $18 billion in bonuses last year while their crumbling financial sector received a bailout from taxpayers.
Then there's Biden, who just seems to say whatever flits through his head at the moment:
Vice President Joe Biden also chimed in, saying the level of bonuses "offends the sensibilities."
"I mean, I'd like to throw these guys in the brig," Biden said in an interview with CNBC.
You may be wondering, as I was, why paying $18 billion in bonuses is a bad thing. After all, Obama and the Democrats in Congress are planning to spend over $800 billion on various projects to stimulate the economy and stir up consumer demand. Doesn't the $18 billion in bonuses also stimulate the economy?
A later paragraph makes it all a bit clearer:
Obama said he and Geithner will speak directly to Wall Street leaders about the bonuses, which threaten to undermine public support for more government intervention as the economy keeps reeling.
So the real problem here is that the American public might not like Obama's plan to give billions of dollars of our money to failing companies. What's next? Following Bush's lead in the Iraq war by scolding the news media for reporting that the stimulus funds are being wasted?
What's irresponsible and shameful here is giving hundreds of billions of government money to private businesses. Whining about how they spend it doesn't help. Just don't give them the money.
Said Obama about Wall Street leaders: "There will be time for them to make profits, and there will be time for them to get bonuses. Now is not that time."
The arrogance here is amazing. Did it ever occur to these buffoons that not every department of every financial company is in ruin, meaning that some of these people must have earned those bonuses? Or that you have to pay bonuses to keep good people? Or that for many workers, a so-called "bonus" is actually a regular part of their pay?
I worry that this is only the beginning. I'm afraid that once government "stimulus" money starts flowing into every economic sector, the folks in Washington are going to think they should run it all.
Update: This AP wire story explains it nicely:
To President Barack Obama, Wall Street's $18.4 billion in bonuses is "shameful." To thousands of bank employees who don't sit in corner offices, that money helps pay the bills...
While Wall Street investment banks and other financial firms make headlines for the millions paid out to certain executives, more modest bonuses go to workers from human resources representatives to secretaries as well as employees who actually made money for their companies last year.
...
A product manager at one investment bank said she is cutting corners after her 2008 bonus fell by 38 percent, even though her job performance exceeded expectations and her division posted a profit. To save money, she's raising the deductible on her health insurance to lower the premium, shopping around for less expensive car insurance and cutting back on small luxuries.
"My bills haven't gone down by 40 percent," said the worker[.]
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