Forum Post: "46 million in poverty, $21 billion in bonuses"
Posted 12 years ago on Oct. 11, 2011, 12:49 p.m. EST by gotham6767
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Although it doesn't capture all of the issues at hand, it fundamentally speaks to most of them, and it's entirely factual:
"46 million in poverty, $21 billion in bonuses"
The latter statistic, the bonuses paid by Wall Street firms in 2010 alone(!), is the NY State Comptroller's estimate (see http://www.economist.com/node/18231330)
http://feedingamerica.org/
If most of these companies - in fact all of the bulge-bracket financial firms and banks - would have gone bankrupt without a taxpayer bailout, leaving NO money for bonuses, where did that bonus money come from?
It was a transfer payment from the taxpayers; bankrupt companies couldn't possibly have the $17.6 BN for the bonuses they paid in 2008, $22.5 BN they paid in '09, and the $21 BN they paid in 2010.
Moreover, the financial firms such as Goldman Sachs would have gone under because they failed at precisely what they say they deserve those huge bonuses for: superior risk management. If they would assert that they "deserve" those bonuses, they also deserve the financial pain of getting it wrong. Instead, they got rich.
People have a very good reason to be furious with that outcome.
That's somethin ain't it? The poor are getting poorer once again in America. The corporate media is blaring 24 hours about our desires and wants when 40 million Americans don't even have their needs satisfied yet. 40 Million is bigger than many counties. In the richest and most advanced country in the world, such destitute resides in ever street corner. We walk past it everyday unaware and anesthetized by Media. We need to wake up soon because that 40 million is only getting bigger.
Oh yea, by the way, if capitalism was so great we should be having 40 million millionaires by now.
And your point is what, exactly?
Take that bonus money away from those executives and "redistribute the wealth" to those at the bottom? Great.
That works out to $456/person.
You're only going to let the bottom 46 million people have a bite at that apple? What about the other 284 million people in the country - don't they "deserve" a cut of that pie?
How about you redistribute it to EVERYONE in the country? That would work out to $64/person.
What happens next year when those same executives decide not to work as hard (because their bonuses are going to just be redistributed again)?
No money to "redistribute" to those at the bottom, and those folks won't have done anything in the meantime to try and earn it themselves, because they will feel like they are OWED that money - and they aren't going to care where it comes from, just that it be found.
Where do you propose that $21 Billion come from the next year?
That 46 million probably includes non-working family members (kids and such). So, really, the 21 Billion would be divided by, lets just pretend 1/3 are kids and non-income producers. That comes to about $684 per household. When you have nothing, $684 goes a long way. Especially if you only have a little and can stretch that on food or lodging for a couple months. And, BTW, those are just bonuses. Those same execs get MILLIONS in stock grants and options, salary, fringe benefits and so on. Just look at all the insider transactions for JPM: http://finance.yahoo.com/q/it?s=JPM+Insider+Transactions -- So, there's plenty of ways to compensate them. The real question, is where is the happy medium and how much do they REALLY need to be compensated?
I believe the more important question that you should be asking yourself is WHO, exactly, is going to be DECIDING how much they "get" to be compensated.
Think about that long and hard.....
Then ask yourself who YOU want to be deciding how much YOU "deserve" to be compensated for the work that you do.
What, exactly, do you think these executives DO all day - sit around and burn money? When you have SUCCESSFULLY run a multi-billion dollar company for many years, then you can get back to me on their compensation packages.
And again, if you take that $21 Billion from these folks, it's going to be a ONE-TIME thing - it won't be there the next year.....
No doubt, it takes a lot to run a mulit-(bm)illion dollar company. I don't want to minimize that. Not everyone has what it takes, including myself. However, looking at JPM insider transactions, one person either acquired or sold over 230 MILLION in stock over the last 2 years. Really? Does that single person contribute that much to the company? I'm not necessarily saying split the money and giving it to the needy. Cutting exec bonuses completely is not the answer, I agree. Why not push that cash further into the people that work for that company? Spread the wealth to those employees. After all, the employee's are the ones who make the company, not the CEO or the board of directors. They all know that.
Who and how much is a tough one, I get that too. Shoot, the basketball players and owners can't figure that out. I don't have a solution there: it's a tough problem. Maybe the answer is to loose the public stock market system. There really isn't much value outside of for those who have a ton to invest in it. The only advantage I think I see, maybe, is the ability to raise a ton of cash quickly. That gets you into the market faster and ahead of others. But is that really a good thing?
And, yes, they burn money. I've been in middle management in a fortune 500 company. The year we laid off a lot of people (2008) I went to a managers meeting where we purchased a bottle of wine "from around the world". Around 10-15 bottles of wine. Couple thousand dollar bill between around 10 people. It was all excess. I didn't need a bottle of wine to keep me working hard. I did it because I was paid to do it. I'm a good little 99%'er aint I?
Get rid of the bonuses, the CEO and board of directors will leave, and then the ENTIRE company will be out of work.
Great idea.
I didn't say that. Lets assume they do leave. You assume that the CEO and board of directors are required for a company to function. In fact, I don't believe they are required. VP's, middle managers, and the workers are the ones who do the real work in the companies I've worked for. CEO's and board of directors play golf with each other and collect $$
And you honestly think that these VPs and middle managers will step up and do the job of the CEOs and Board Members, KNOWING that they aren't going to be compensated accordingly?
You're dreaming.
The company will go under in less than a year. Janitors can't run a multi-million dollar company.
My point was, they already run the company. CEO's just give speeches, play golf, and whine when things don't go their way. You really have a hard time with comprehension don't you? You must be a CEO. Only hear what you want to hear and interpret to fit your line of thinking.
Never been a CEO - I'm an engineer by training. I'm afraid you are the one who doesn't comprehend the VAST amount of work that is done by every successful CEO out there - those companies don't exist in a vacuum. A successful CEO has to pull together a team of people that he/she can trust to manage their "divisions", and then the CEO has to make decisions based on the input that he/she gets back from those people.
If you honestly think that all that CEO's do all day is "give speeches, play golf, and whine when things don't go their way", I'm afraid that YOU are the one who "only hear what you want to hear and interpret to fit your line of thinking"
I happen to know more than a few people who run their own businesses - they work harder than anyone I know. I shudder to THINK how hard a person in charge of a multi-billion dollar business has to work to keep everything afloat.
I guess we all run on our own experiences. I've not been impressed with any large or mid-sized corporation CEO. Last 2 companies I worked for, they ran it into the dirt by not listening to their managers and employees, yet they walked away with plenty of $$. The one I work for now, is not too bad, mostly because of the VP and mid-level management they've been smart enough to hire (who should receive a larger stake in the company). Finding the right people can be attributed to the CEO, I guess I'll give in to that. But, honestly, CEO's are mostly salesmen who play the game well enough to position themselves. BTW - I'm an engineer too.
Those would be "unsuccessful CEOs" - they tend not to get hired on at other companies if they run one into the ground (not always true, but for the most part, it is).
A CEO who started his/her company from the ground up and is still there tends to be extremely hard-working. A second- or third-"generation" CEO - that is, someone who wasn't there at the beginning - will tend to screw things up royally.
Everybody hears about the screw-ups; the ones who keep things running tend to be very quiet about it. Unfortunately, this administration is full to the brim with the 1st kind and none of the 2nd kind.....
Here's a list of what the Top 20 US Companies paid in taxes in 2010: www.forbes.com/2011/04/13/ge-exxon-walmart-apple-business-washington-corporate-taxes.html There's an interactive link so you can see what percentage of their profits were paid in taxes - it certainly opened up my eyes.....
I agree on the 2nd and 3rd generation CEO point. The original founders always have more stake and care more for the company. Others are more in it for the money, not the passion, of running a successful company
This will get you to the interactive - you can scroll through each slide, and click on the screen at the bottom of each picture to open the information window: http://www.forbes.com/2011/04/13/ge-exxon-walmart-apple-business-washington-corporate-taxes_slide.html
Well, crud - that link won't get you to the right page! http://www.forbes.com/2011/04/13/ge-exxon-walmart-apple-business-washington-corporate-taxes.html You may have to cut and paste the link.....
Those are interesting slides, but if you think about it, it just highlights the distribution of wealth is screwed up. Unless I misunderstand, in those slides, Wells Fargo for example had $19 Billion in pre-tax revenue. That's $19 Billion that was not distributed to the people that work for them. I get the 'corporation' wanting to have money in the bank to weather hard times. Doing that is just smart. But, $19 Billion? That doesn't include cash and assets they already own.
I think this makes a lot of sense as a rallying cry...