Can someone get me my beta blockers? You have to have a bottle of something close by if you dare to read the financial news on any given day. Like, oh, say, Monday, the Day of Atonement: Businessweek reports that over in the rigid class-based United Kingdom, even they have the guts to reign in the banker class, with new plans to ban annual banker bonuses:
British Treasury chief Alistair Darling said Monday that annual bonuses for bank executives will be outlawed in an attempt to curb excessive risk-taking in the country’s huge financial sector.
Darling told the governing Labour Party’s annual conference that new legislation to restrict how the payments are made will be introduced in Parliament within weeks.
Meanwhile in the United States, which was founded as a meritocracy-based antidote to the United Kingdom, overthrowing the stifling class system of King George’s England…over here, we’re the last suckers in the Western world too in awe of our Wall Street plutocrats to dare upset their gravy train, according to Reuters:
President Barack Obama‘s “pay czar” said on Friday he will not cap compensation for the top employees at bailed-out companies, and will not reveal names, when he releases the first wave of decisions within a few weeks.
That’s right, this is a free country by gum! We’re free to get poorer by the year, and if there’s one thing we’re still Number One at, it’s that no Western country’s middle class gets poorer with more enthusiasm than 21st century Americans. No one sees their share of wealth constantly fall further and further behind the super-wealthy, no one watches them transfer our wealth into their offshore bank accounts better than we do, according to the AP:
The wealthiest 10 percent of Americans – those making more than $138,000 each year – earned 11.4 times the roughly $12,000 made by those living near or below the poverty line in 2008, according to newly released census figures. That ratio was an increase from 11.2 in 2007 and the previous high of 11.22 in 2003.
Household income declined across all groups, but at sharper percentage levels for middle-income and poor Americans. Median income fell last year from $52,163 to $50,303, wiping out a decade’s worth of gains to hit the lowest level since 1997.
That last bit needs to be repeated: the wealthiest 10 percent earn a bigger share of wealth now, in the crisis, than at any time on record! While the average American’s income dropped to where it was 12 years ago.
And the worst thing of all…is that we seem to like it this way.
This American fantasizes about fighting for his freedom from Islamo-commies. Meanwhile, Wall Street plutocrats rob his house every single night, and he doesn’t do a damn thing about it.
If you thought this sort of feudal tendency collapsed with the financial crisis and the “socialist” Obama Presidency, you, sir, ma’am, are…well, you’re just another American sucker, that’s all. You forgot that you live in an oligarchy, and that means all of us, and this entire country, are little more than a playground/casino for the super-wealthy barons who lord over us. It isn’t our country anymore; it’s theirs. Only that could explain why, even as the crusty class-based Brits are reigning in their bankers, over here, the bankers are running wild again, gambling taxpayer bailout billions on the very same derivatives that destroyed the global economy in the first place:
U.S. commercial banks earned $5.2 billion trading derivatives in the second quarter of 2009, a 225 percent increase from the same period last year, according to the Treasury Department.
More than 1,100 banks now trade in derivatives, a 14 percent increase from last year. Four banks control the market: JPMorgan Chase, Goldman Sachs, Bank of America and Citibank account for 94 percent of the total derivatives reported to be held by U.S. commercial banks, according to national bank regulator the Office of the Comptroller of the Currency.
The credit risk posed by derivatives in the banking system now stands at $555 billion, a 37 percent increase from 2008. “By any standard these [credit] exposures remain very high,” Kathryn E. Dick, the OCC’s deputy comptroller for credit and market risk, said in a statement.
STOCKHOLM — Seven European countries on Friday called on G-20 leaders to put together strict limits on bonuses to bank executives, calling excessive payouts not only “dangerous” but also “indecent, cynical and unacceptable.”
In a joint opinion piece in Swedish daily Dagens Nyheter the finance ministers of Sweden, France, Spain, Germany, Italy, Luxembourg and the Netherlands said risks related to payouts should be surveilled very strictly.
“Bonuses guaranteed for more than a year should be banned. Bonuses should be paid out over a number of years and should mirror the individual’s and the bank’s actual performance over time,” the ministers wrote.
“We have to stop some financial actors from returning to the same destructive behavior as before,” they wrote. “We have to be very clear: this behavior is not just dangerous, it is indecent, cynical and unacceptable. It is a punch in the face of all the people who are quickly becoming unemployed.”
The initiative follows a similar move Thursday by the leaders of France, Germany and Britain. In a joint letter to the Swedish government — which currently holds the rotating European Union presidency — France’s Nicolas Sarkozy, Britain’s Gordon Brown and Germany’s Angela Merkel said it was especially important to forge international rules to rein in traders’ bonuses.
French President Nicolas Sarkozy had threatened to walk out of the meeting unless leaders agreed to impose a specific “ceiling” on bankers’ compensation as a way to curb irresponsible risk-taking. The idea of a hard cap on bankers’ bonuses had been rejected by the United States, and leaders are working toward a joint statement that calls more generally for restraints on pay.
Late-Late Udpate: Even frickin Slovenia has the cajones to tax its bailout queen bankers! Gah! We should bury our heads in shame, and we would too, if our banker-rulers asked us to. But we’re more useful pretending that there’s nothing to be ashamed about.
Mark Ames is the author of Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine.
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