Pushing back against the tide

Whenever something swings, there is usually a return swing in the other direction. From Bloomberg comes the initial whispers of something much needed:

Bonuses for Wall Street Should Go to Zero, U.S. Taxpayers Say
U.S. taxpayers, who feel they own a stake in Wall Street after funding a $700 billion bailout for the industry, don't want executives' bonuses reduced. They want them eliminated.

"I may not understand everything, but I do understand common sense, and when you lend money to someone, you don't want to see them at a new-car dealer the next day," said Ken Karlson, a 61-year-old Vietnam veteran and freelance marketer in Wheaton, Illinois. "The bailout money shouldn't have been given to them in the first place."

An example:

Goldman, the largest and most profitable U.S. securities firm in the world last year, paid Chief Executive Officer Lloyd Blankfein a record $67.9 million bonus for 2007 on top of his $600,000 salary. That was justified, he told shareholders at the company's annual meeting in April, because of Goldman's superior financial results.

And the money quote (as it were):

"Bonuses and severance packages will obsess the American public" and become "a humiliation and embarrassment," said Arthur Levitt, a senior adviser to the Carlyle Group, former chairman of the Securities and Exchange Commission, and a board member of Bloomberg LP, the parent company of Bloomberg News. "Compensation committees, believe me, are paying close attention to this."

Several of the companies -- including Citigroup and Wells Fargo -- have said they won't use federal funds to pay bonuses. That's disputed by some, including former compensation consultant Graef Crystal.

"The argument of saying we're not using the bailout money is just crap because money's fungible, money's money," said Crystal, who writes the newsletter graefcrystal.com. "It exposes them to ridicule."

The Crystal Report referenced in the last paragraph is interesting reading...