Please tell us about these accounting tricks. Although clearly we think bankers are sub-human, they are cash method taxpayers like everyone else. If you know of a way to hide income that's reported on your W-2 I'd love to hear more about it.
What's sort of sad and fucked up about this is that her position, and Obama's, seems to be, essentially, not that Wall Street's elite shouldn't exploit the suckers but rather that they should know better than to get caught exploiting the suckers right at this politically sensitive moment--when the suckers are, you know, uncharacteristically paying attention.
They should wait to face-fuck everyone later, once shit has cooled down and the suckers are watching American Idol finals or something.
So Jezzies discovered MO is not just a "backwards red state!" Claire lives in my city, and we're all "blue", baby!! (inner ring suburb of St. Louis, which is a liberal blue cosmpolitan city with culture, arts and hipsters too, for those of you who were wondering) Missouri is strange. Deeply conflicted between East and West coast, Dem and Repub, black and white. We just elected a Dem Governor, but Obama lost here by maybe 5000 votes. Don't Hate, Congratulate. We're doin the best we can, which is more than I can say, for like, Iowa... ;)
OK, so the whole thing is only for corps receiving bail out money. She is saying that no one needs to be making 4 mill a year, which is possible in some of the upper management levels. I understand outrage, but why didn't this get discussed before? You can't really cut someone's salary by 3/4 and say "That's life." I don't know, it seems a little bit reactionary, now that I think it through. Sure, we could all do just fine with 400 grand a year, but we also don't have the responsibilities or background and experience some of these CEOs have. Just being the devil's advocate.:::ducks:::
@badmutha: I see that point, but and I've got no problem with people on Wall Street or what have you making a gazillion dollars--unless it's from a bailout. And I think you CAN tell people "tough cookies." If it weren't for the bailout, they'd be out of a job and have NO salary.
@badmutha: I agree with you. I get that the outrage is easy to have, but yes, cutting someone's salary by 3/4 would be devastating to anyone, regardless of how much you make because you live your life with expectations based on your salary.
That said, the banks handlded this with the tact of a bull in a china shop.
While I agree that it would be difficult at best to get by on less than what one has come to expect, isn't that what thousands are learning to do everyday when they are laid-off of their jobs due to the economic downturn hastened into being by the bankers and Wall Street geniuses whose salary would be cut in the first place?
@checkyopremisebitch: He somewhat had a point in that the guy making 4 million probably employs at least 3 people at home (nanny, driver, cook) and spends huge amount of money. But without the bailout, he'd be unemployed so no, he shouldn't be getting a bonus.
@checkyopremisebitch: Yes seriously. No bonuses = less spending because of less money to spend. Less spending = less money going to wait staff, valet/car parking attendents, dry cleaners, retail shops, and many others in the service industry. Down here on wall street 90% of the business are ONLY open when business are because they make the most money by servicing people in the field. If those people stop spending then those buisnesses will be closed all the time.
@Boredinacubicle: They're not going to spend their bonuses on the typical shit. You wait. They will save it offshore for what they know is coming--and keep the option to move their families elsewhere ready to exercise at a moment's notice.
The other misinfo bullshit is that if they don't get a big bonus on top of their over-paid salary then they'll quit.
Yeah, right. With many equally-experienced, family-supporting, 401K-depleted colleagues out of work, I'd like to see that. (And so would they.)
Neither President Obama nor Senator McCaskill understand Wall Street compensation and what is meant by the term 'bonus'. A bonus is not a reward at the end of a year for a job well done, it is part of total annual compensation. Base salary + bonus = total annual compensation. Banks structure payments this way in order to hold on to the bulk of employee compensation rather than pay monthly.
Base salary at most investment banks is about the same for all levels of seniority, about $120K.
A Managing Director could receive a multiple of the amount while a junior analyst might only see another $10K.
These idiots in Washington need to learn the terminology if they're going to weigh in on things they dont understand.
@Isolationtzar: I agree that there's been a total lack of explanation about what a "bonus" really is on Wall Street, how they're allocated, and that some of the people getting them actually have (realtively) low salaries, because the bonus is a large portion of their compensation.
That said, the understanding within the banking world of what a large salary and/or bonus is is skewed by years of success.
@Isolationtzar: Base salary + bonus = total annual compensation is true for everyone not just Wall Street.
If these lump sums are expected, why are they called bonuses? I think a lot of people are pissed because they think that bonuses are tied to job performance and it's hard to see how people at a bailed-out company could have been performing that well.
@Isolationtzar: Yeah, half of me is like "HELLZ YEAH TAKE THAT RICHIEZZ!" but the other half knows that this whole $18bn controversy stems from the fact that people don't know that this is an industry where "bonus" doesn't really mean "Surprise we had a great year so here you go!" like it does at a lot of other places. (Also, I think it's a little disingenuous of Obama to pretend like he doesn't understand that, given how Big Law is not without its expected year-end bonuses and I'm sure they planned around Micheles', but I guess he's just playing man-of-the-people here.)
That said I do think the financial industry would be better off if the compensation was distributed more heavily toward base salary and away from year-end bonuses. Also, this 18bn is a 44% drop from last year, and NYC is SCREWED in terms of taxes. Le sigh.
@yvanehtnioj ... and Zombies: I worked big law, my sister in finance - they are different. Law firm base salaries are higher and the bonuses are smaller compared to finance.
@Clare116: Yes but base salary for most other professions is on par with industry standards.
Senior executives does not only mean the stock broker and CEO. It equates to General Counsel, Compliance Offiers, Researchers, Accounting and so on. People who work in the financial sector take MUCH lower salaries then industry standards dictate because their year end incentive (bonus) compensates for the difference.
If you reduce salaries and bonuses you loose good, smart, hard working people who can help fix this situation. You think the financial sector is in trouble now, wait and see what happens if this passes.
And please the President makes 400k a year as long as he is in office. Once he's out he's free to make millions on book deals, speaking tours and the like. No one caps his salary for life.
@Isolationtzar: Uh, yeah, she's talking about limiting total compensation to a $400,000 salary, and specifically at banks that accept bailout funds which might/might not include investment banks. Also, please don't expect anyone here to buy that the CEO of an investment bank makes $120,000 base salary. You could, say, look up their filings and link to that, but because it's not true you didn't. I'm giving you the "Bish pls" face right now. Maybe you shouldn't talk about legislation you don't understand.
@Isolationtzar: But how can you take taxpayer money and not cut salaries. People are getting furloughed and getting their salaries cut and stilll have to pay taxes. Why should their money be used to upkeep ridiculously high salaries?
@Boredinacubicle: "If you reduce salaries and bonuses you loose good, smart, hard working people who can help fix this situation. You think the financial sector is in trouble now, wait and see what happens if this passes."
Really? I'm sure it will happen to some extent but the finance world pays SO much that I can't imagine that there are too many other things they can do to make that kind if money. Even if it's less than it was before, it's still a lot.
It's one thing to say that, like, teachers salaries are low and people flee to other professions. Or government lawyer salaries are low compared to firm lawyers. But Wall Streeters? Can they really just take their balls and go home?
@LittleLolly: Also, so the banking industry uses accounting tricks to hide the true salaries of their employees until the end of the year and that's a good thing? Aren't accounting tricks what got us into this mess? Enron?
Also, boredinacubicle, where are all this poor bonus-less employees going to go? Wall street is a mess there is no place for them to run to because of unemployement.
Funny, how when it was autoworkers who made $50,000 a year in Detorit everyone freaked out.
@Clare116: I'm not talking about front office *ie the money makers and the people who fucked it all up* I'm talking back office employees. The lawyers, accountants, Compliance specialists, researchers, and the like. They can most definitly pack their balls and go play on someone else's court. And once the back office is gone the front office has nothing to support it. It's usuall the back office people who step in to fix shit once it's gone horribly arwy.
"I'm talking back office employees. The lawyers, accountants, Compliance specialists, researchers, and the like."
i doubt these people are going to be affected by a $400,000 cap on total compensation. most of them would probably be more than happy to make that much a year.
@unionmaid: "Funny, how when it was autoworkers who made $50,000 a year in Detorit everyone freaked out."
Nope. That was Republicans being their usual asshole selves. Not I. I have long said that finance people are overpaid, and I don't think $400K is chump change, and I understand people's impulse to punish people that they think caused all of this, but I think this is a bad idea (b/c I think that a WELL REGULATED market actually can work, and I don't like the idea of capping salaries of industries we're mad at). And I honestly do think that people don't understand how compensation works in finance, which is not really their fault, because it works differently than almost anywhere else.
There's a very good and interesting argument to be made that this different system (putting a huge percentage of total compensation in the bonus, rather than salary) contributed to this crisis from CEO to analyst, but this spiel and Obama's before it seem more to be about simple outrage, not let's-have-this-conversation. If that makes sense.
@Isolationtzar: Look, I do agree that the public doesn't understand how base salary + bonuses work on Wall St. and the media hasn't done much to clear this up. However, I really don't think that would do much to change to outrage. The fact is when a lot of people are making $50,000 a year, they are going to be pissed that their tax money is being used to compensate employees at a failing bank, when those employees have already earned three times more than them in base salary alone. The fact is, these companies are bankrupt, and the bailout is meant to get them through the crisis, not to keep them in a posh lifestyle.
@Isolationtzar: So the size of bonuses is not based on an financial institution's profits? That was always my understanding. But I must be totally wrong, or else this year's bonus payouts would have been in the negative billions ... ie not actually payouts at all.
Your defensive tone is poorly chosen, considering that your entire profession has an enormous bulls-eye on its back right now. I guess you have NO IDEA how politically and culturally tone-deaf it sounds to respond to general public frustrations about ridiculous risk-taking, obscene overcompensation and the utter lack of logic connecting the two with "Duh, you morons are too stupid to understand; it's only CALLED a bonus."
@Isolationtzar: Why can't we use the same logic that people use on those of us in the "tipped" professions. People are always saying you should just leave if you don't like not getting tipped, why should I have to tip etc?
You shouldn't EXPECT them as part of your compensation [even though Uncle Sam sure expects you to claim them whether or not you actually received them.]
Why are people in finance so different? So you EXPECTED a bonus as part of your compensation package? Well I expected to make $200 last night and didn't but by the sales I rang, I should have.
Everyone is doing shitty, why are they still expecting the bonuses they should have received based on their job/business doing well?
People everywhere are taking pay cuts, why shouldn't they...arguably one of the root causes of this whole mess anyway?
@Isolationtzar: Instead of a snide comment, why not try answering to anything Megan said? Your point could be made in a much less accusational and know-it-all way.
@Majrhoulihan: They did cut salaries - 44%. Many banks (Credit Suisse is the first that comes to mind) paid bonuses out of pools of so-called toxic assets. So if that sub prime mortgage that's in the pool of toxic assets doesn't pay off you'll never get a bonus.
@unionmaid: What are these tricks you know about? I'd like to save money on my taxes.
Enron is going to turn out to be what probably caused this mess. Post-Enron the angry mobs were calling for mark-to-market accounting which is a big part of the mess we're in right now.
@yvanehtnioj ... and Zombies: The problem with auto workers that make $50 an hour is that you still have to pay them when there's no work. Wall street is shedding the dead weight like it's going out of style.
01/31/09
01/30/09
01/30/09
They should wait to face-fuck everyone later, once shit has cooled down and the suckers are watching American Idol finals or something.
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
That said, the banks handlded this with the tact of a bull in a china shop.
01/30/09
While I agree that it would be difficult at best to get by on less than what one has come to expect, isn't that what thousands are learning to do everyday when they are laid-off of their jobs due to the economic downturn hastened into being by the bankers and Wall Street geniuses whose salary would be cut in the first place?
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
The other misinfo bullshit is that if they don't get a big bonus on top of their over-paid salary then they'll quit.
Yeah, right. With many equally-experienced, family-supporting, 401K-depleted colleagues out of work, I'd like to see that. (And so would they.)
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
Base salary at most investment banks is about the same for all levels of seniority, about $120K.
A Managing Director could receive a multiple of the amount while a junior analyst might only see another $10K.
These idiots in Washington need to learn the terminology if they're going to weigh in on things they dont understand.
01/30/09
01/30/09
That said, the understanding within the banking world of what a large salary and/or bonus is is skewed by years of success.
01/30/09
If these lump sums are expected, why are they called bonuses? I think a lot of people are pissed because they think that bonuses are tied to job performance and it's hard to see how people at a bailed-out company could have been performing that well.
01/30/09
That said I do think the financial industry would be better off if the compensation was distributed more heavily toward base salary and away from year-end bonuses. Also, this 18bn is a 44% drop from last year, and NYC is SCREWED in terms of taxes. Le sigh.
01/30/09
01/30/09
01/30/09
01/30/09
Senior executives does not only mean the stock broker and CEO. It equates to General Counsel, Compliance Offiers, Researchers, Accounting and so on. People who work in the financial sector take MUCH lower salaries then industry standards dictate because their year end incentive (bonus) compensates for the difference.
If you reduce salaries and bonuses you loose good, smart, hard working people who can help fix this situation. You think the financial sector is in trouble now, wait and see what happens if this passes.
And please the President makes 400k a year as long as he is in office. Once he's out he's free to make millions on book deals, speaking tours and the like. No one caps his salary for life.
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
01/30/09
Really? I'm sure it will happen to some extent but the finance world pays SO much that I can't imagine that there are too many other things they can do to make that kind if money. Even if it's less than it was before, it's still a lot.
It's one thing to say that, like, teachers salaries are low and people flee to other professions. Or government lawyer salaries are low compared to firm lawyers. But Wall Streeters? Can they really just take their balls and go home?
01/30/09
Also, boredinacubicle, where are all this poor bonus-less employees going to go? Wall street is a mess there is no place for them to run to because of unemployement.
Funny, how when it was autoworkers who made $50,000 a year in Detorit everyone freaked out.
01/30/09
01/30/09
"I'm talking back office employees. The lawyers, accountants, Compliance specialists, researchers, and the like."
i doubt these people are going to be affected by a $400,000 cap on total compensation. most of them would probably be more than happy to make that much a year.
01/30/09
Nope. That was Republicans being their usual asshole selves. Not I. I have long said that finance people are overpaid, and I don't think $400K is chump change, and I understand people's impulse to punish people that they think caused all of this, but I think this is a bad idea (b/c I think that a WELL REGULATED market actually can work, and I don't like the idea of capping salaries of industries we're mad at). And I honestly do think that people don't understand how compensation works in finance, which is not really their fault, because it works differently than almost anywhere else.
There's a very good and interesting argument to be made that this different system (putting a huge percentage of total compensation in the bonus, rather than salary) contributed to this crisis from CEO to analyst, but this spiel and Obama's before it seem more to be about simple outrage, not let's-have-this-conversation. If that makes sense.
01/30/09
01/30/09
Your defensive tone is poorly chosen, considering that your entire profession has an enormous bulls-eye on its back right now. I guess you have NO IDEA how politically and culturally tone-deaf it sounds to respond to general public frustrations about ridiculous risk-taking, obscene overcompensation and the utter lack of logic connecting the two with "Duh, you morons are too stupid to understand; it's only CALLED a bonus."
01/30/09
You shouldn't EXPECT them as part of your compensation [even though Uncle Sam sure expects you to claim them whether or not you actually received them.]
Why are people in finance so different? So you EXPECTED a bonus as part of your compensation package? Well I expected to make $200 last night and didn't but by the sales I rang, I should have.
Everyone is doing shitty, why are they still expecting the bonuses they should have received based on their job/business doing well?
People everywhere are taking pay cuts, why shouldn't they...arguably one of the root causes of this whole mess anyway?
01/30/09
01/30/09
01/30/09
01/30/09
Enron is going to turn out to be what probably caused this mess. Post-Enron the angry mobs were calling for mark-to-market accounting which is a big part of the mess we're in right now.
01/30/09
01/30/09
01/30/09