Wall Street Uses the “S” Word to Denounce Criticizing its Bonuses — Socialism!

Created: February 01, 2009 12:00 | Last updated: July 31, 2020 00:00

The New York Times took a stab at getting people who work on Wall Street to defend taking in more than $18 billion in bonuses — roughly the amount that was paid out in 2004, when the economy was just slightly different – and found that most aren’t owning up to ever getting the money.

From The Times:

[I]t was rather remarkable on Friday how many white shirts denied getting a bonus altogether when they were asked. Indeed, if the data obtained by reporters in the district was any measure, there is no telling where that $18 billion really went.

But a few did talk, and their feelings were hurt that President Obama called them shameful. They used another “s” word to describe his views — socialism!

“I think President Obama painted everyone with a broad stroke,” said Brian McCaffrey, 55, a Wall Street lawyer who was on his way to see a client. “The way we pay our taxes is bonuses. The only way that we’ll get any of our bailout money back is from taxes on bonuses. I think bonuses should be looked at on a case by case basis, or you turn into a socialist.”

That, indeed, was a recurring equation: Broad strokes + bonuses = socialist.

“It’s a very slippery slope to go down,” said another insurance broker as he waited to be seated for lunch at Cipriani Downtown. “A blanket statement like that borders on” — you guessed it — “socialism.”

I think we’ve all had enough here. Before this descends into name calling, I think the best way to resolve this bonus controversy once and for all is to call the bankers’ bluffs. They keep saying they need bonuses to retain talent — a hard argument to make for banks that are barely solvent, like Citigroup — and that if they don’t pay, their top people will leave.

So let’s just find out if that’s true. Let those talented people look elsewhere. See how well the job market greets financial executives with resumes from bailed-out banks. Watch what happens to AIG employees who don’t get retention bonuses and go shopping their service elsewhere.

I don’t expect a sudden brain drain.

Instead what might happen is something that should have occurred a long time ago. Wall Street seems to be in some form of denial. There’s a sense that big bonuses and corporate perks are still part of the picture, and that life hasn’t changed that much. But it has. It’s over. And so is the notion that top employees of failed banks are any different than the rest of us, that the private sector will pay any price for them.

The financial industry is headed for its first wake-up call with new regulations ahead from an increasingly annoyed Congress and executive branch. The second is the growing disgust with the old ways of Wall Street at a time when other Americans look at their bank accounts and know that everything has changed.

Monster.com has been good enough for the rest of us. It should be just fine for the finance industry too.