We know where the first $1.6 billion went.

 

December 23, 2008

Early Christmas for bank CEOs

ASBURY PARK PRESS EDITORIAL

Thank heavens that Lloyd Blankfein, president and chief executive officer of Goldman Sachs, will not have to suffer the fate of Dickensian urchins this holiday season.

Not with the nearly $54 million he was compensated for the bang-up job he did this year.

We bet you're still waiting for a thank-you note. After all, you and your tax dollars helped make his holidays bright.

And Blankfein is hardly alone.

As The Associated Press reported over the weekend, banks that are getting taxpayer bailouts awarded their top executives nearly $1.6 billion in salaries, bonuses and other benefits last year.

This is both an intellectual and a moral failure.

The intellectual failure happened when the Bush administration changed the emphasis of its Troubled Assets Relief Program from buying bad mortgages to pumping money directly into banks. And while the program did set limits on some executive compensation, it did not generally do the same for salaries and bonuses. How did Congress not see this bonus bonanza coming?

Executives live for this kind of thing. That's why they hire phalanxes of loophole-seeking lawyers to find and exploit every possible way around the clear intent of every piece of legislation that might affect them.

Right there, you have the moral failing. If the spectacle of the last few months has shown us anything, it is that those who live in the rarefied world of corner offices and compensation packages that are virtually unimaginable to the rest of the working world just don't get it. They really don't see how obscene it is to walk up the Capitol steps to ask for a handout with a golden parachute on their backs and a tin cup in their hands.

Rep. Barney Frank, chairman of the House Financial Services Committee, said these bonuses amount to a bribe "to get them to do the jobs for which they are well paid in the first place." Rep. Brad Sherman, a Democrat from California, another member of the House Financial Services Committee, put it this way: "The tougher we are on the executives that come to Washington, the fewer will come for a bailout."

It's about darn time, too.

To which we can only add, with Charles Dickens, "God bless us everyone!"