Guest eastburbguy Posted January 30, 2009 Posted January 30, 2009 This will undoubtedly offend several here, which I acknowledge in advance. That said, my words echo my views, which are very sharp in nature. It's popular these days in many circles to succumb to the vapors when confronting the supposed virtues of "bi-partisanship." Just ask David Broder, the most over-rated, "inside the Beltway prisoner" ever taken by the Washington Post. (IMO, Broder has happily stayed a Prisoner of that incestuous "I'll tell you what you want to hear in return for you doing the same for me" journalistic debauchery for decades and, sorry to say, it's not likely to end until he dies). IMO, "bi-partisanship" is a means to an end, not an end in itself. It's pretty goddamn clear - the RePigLican brand of "bi-partisanshiip" means "Do it our way or we won't vote for it." Well, fuck bi-partisanship. In my world, if you have the goddamn votes, you pass the bills and take the accountability. The public may like them all to make nice, and God knows The Media Morons will always swoon over Kissie Kissie, but power is power, and that's what it's all about - serious policy - winners and losers - Wall Street bonuses versus Main Street foreclosures. Views, anyone? Bonus Bans Are Too Late to Fix Banking Industry: Matthew Lynn 2009-01-28 00:00:00.0 GMT Commentary by Matthew Lynn Jan. 28 (Bloomberg) -- For bankers, the prospect of getting a big check at the end of 2009 was already bleak. Now it is a whole lot worse: Politicians have declared a war on bonuses. U.S. President Barack Obama has indicated that further support for banks will be dependent on ending the bonus culture. French President Nicolas Sarkozy has offered state aid to banks if executives skip extra rewards. In the U.K. and Switzerland, where financial institutions form a larger part of the economy, big banks will have to find ways to limit compensation. While the initiatives may be understandable, there is no point in fooling ourselves that they will fix anything. Sure, bonuses were a problem. Nobody denies that. Yet the time to attack them was five years ago. Right now, the priority is to rebuild the financial system, not hammer it even more. There is little question that paying bonuses to bankers will soon be about as acceptable as smoking on an airplane. Obama has already made his plans clear enough. White House Press Secretary Robert Gibbs said last week the president had asked for restrictions to be included in the latest bank-rescue plan to make sure the money won't go to "line the pockets of people" who have received financial assistance. Likewise, Sarkozy agreed this month to allocate 10.5 billion euros ($13.8 billion) to the country's biggest lenders, on the condition that top executives give up bonuses. New Rules Zurich-based UBS AG will pay some bonuses for 2008 in a plan that had to be approved by the Swiss banking regulator, according to a report in the newspaper SonntagsZeitung. And the Sunday Telegraph reported that the U.K. government is planning a new set of rules that will limit the amount that bankers can collect. Don't expect those curbs to be lifted any time soon. Many banks are limping along on life support provided by the state. Not surprisingly, electorates won't tolerate bankers swaggering away from the wreckage of the financial system with multimillion- dollar payments that will end up burdening taxpayers. As the pain ripples into the rest of the economy this year, and as unemployment and home repossessions soar, that anger will burn ever more fiercely. There are no votes in being friendly to bankers anymore. It is now clear that the rewards system, and the perverse incentives built into it, played a big part in creating the credit crunch. Most people now accept that giving traders the huge temptation to take bigger and bigger risks with other people's money was a bad way to run the markets. Broken System There is still no point in thinking that clamping down on bonuses will get the financial industry moving again. First, it will be a long time before any banks are making the kind of money that allows them to pay big bonuses. The old way of doing business is broken, and a new one will take years to emerge. Too many banks turned themselves into giant hedge funds, trading their own capital. They got stung -- and they won't be repeating the trick any time soon. Next, the banks are doing their own house cleaning. UBS has introduced negative bonuses: You will make money in good years, and you will lose it in bad ones. Credit Suisse Group AG is experimenting with bonus payments in illiquid assets and trying a system that allows money to be recouped if there are losses. That might work or it might not. The point is that the banks are looking at different ways to provide incentives to staff. Self-preservation dictates they need to do that. They couldn't carry on with the old "heads-I-win-tails-you-lose" motto. Self-Regulation The market is already dealing with the problem of excessive pay. It will do that more effectively than regulators. The politicians are busy fighting yesterday's war. Bonus bans are gesture politics that may end up doing a lot of damage. At some point this crisis will end, and we'll need a financial industry that is innovative and dynamic. And yet if we wrap the banks up in red tape, we'll have a system that is about as entrepreneurial as the postal service. That won't help anyone. Worse, it will distract regulators from thinking about the problems of the future -- rather than the ones that are in the past. There will be plenty of crises in financial markets in years to come, but you can be sure they won't be caused by pay structures. We will find another way to make a mess of things next time around. Limiting bonuses would have been a great idea once, but it's just pointless now and too late. (Matthew Lynn is a Bloomberg News columnist. The opinions expressed are his own.) Two words. One is Hogwash. The other is Bullshit. Quote
Guest BewareofNick Posted January 30, 2009 Posted January 30, 2009 No, you've pretty much summed it up. The rulers of the conservatives, the Drug Addict and Sean Insannity have decreed that Repiglicans shall not compromise with the Democrats in any way. That's why President Obama told them that they won't be able to get anything done listening to the Drug Addict. Their definition of bipartisanship is much like their definition of activist judges. An activist judge is one who didn't rule the way the Repiglicans wanted them to rule. Quote
caeron Posted January 30, 2009 Posted January 30, 2009 I think starting a post talking about 'repiglicans' isn't a way to have a useful dialogue. This is more than a few steps down the slippery slope. Quote
