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Against Monopoly
“What’s a Bailed-Out Banker Really Worth?” writes Steven Brill in his exploration of the ins and outs of setting executive salaries and benefits under the government’s bailout of the too-big-to-fail banks and companies link here.
Started in response to the public anger over the financial mess, it is not likely to satisfy most people, based on this account. We are more likely to find our anger reignited, first by the level of compensation established and second by the behavior of the banks and their senior management, most of whom orally agreed to return their 2009 bonuses but then all but two failed to do so.
In some ways, this account is of a kabuki dance between special master for executive compensation Kenneth Feinberg on the one hand and the Wall Street banks where “by their account, all the bankers are above average and worth every penny of it”, the Treasury Department, and the New York Fed on the other. The proof was the happiness of the bankers at what they got about 60 percent of the total compensation they had tried to justify.
Brill notes that the executives, their boards of directors, and the recruiters for board members are tightly meshed in their common interests in maximizing the levels of compensation, so that won’t change.
Where the article fails is its lack of attention to overall financial reform. Executive compensation is …