Bonus BurglaryOctober 22, 2012 Posted by: Joe Morgan, CFA
No, I don't even know your name,
It doesn't matter
You're my experimental game,
Just human nature
The House of Representatives voted 328-93 last week to impose a 90percent tax on bonuses paid after December 31, 2008 by companiesthat received more than $5 billion in government bailout funds. Ofcourse, the tax would only apply to the "rich," that is those whoreceive total compensation of more than $250,000. The list of thesecompanies is small, to be sure, but contains some surprising namessuch as Wells Fargo, Bank of America and Chrysler.
While out for my weekend run I came across five cyclists allwearing Wells Fargo gear from head to toe. As we passed I didn'tknow whether to feel vindictive or sympathetic. Surely, these fiveguys were not responsible for the breakdown of our entire financialsystem, but my government believes they were.
So instead, I passed them with only a bewildered look on my faceand a confused state of mind. Today, though there may be some casesof wrongdoing, there are thousands of workers at Bank of America,Chrysler and even AIG who have done nothing wrong, but are nowbeing portrayed as the villains of our current crisis.
Too many aspects of the current witch hunt seem to have arisen fromhappenstance. Why the $5 billion cutoff? Why the $250,000 totalcompensation limit? Why only bonus payments and not totalcompensation? Why only the financial sector?
Back home, exhausted from both the run and the mental gymnastics, Ilogged onto the New York Times to see if anythinginteresting was happening and found this little gem: "The Obamaadministration will call for increased oversight of executive payat all banks, Wall Street firms and possibly othercompanies..."
All my questions were answered. The taxing apparently won't stopwith those who received bailout money, or those making more than$250,000, or even with those in the financial sector. So, wheredoes it stop?
Already, the folks at these companies who have nothing to do withthe financial side are being punished. Think of the IT or marketingexecutive who just happens to work for a financial...Read More