January 31, 2009
February 8, 2009
A few years back, way before there was any exposed financial crunch, I raised some questions.
I am not Paul Krugman. In fact, I readily admit that the entire financial system and Wall Street maneuvers baffle me. I understand supply and demand but it seems to have disappeared with the Hula Hoop.
My inquiry was about some year-end machinations by Verizon. They had fired about 2,500 workers right before Christmas. It was then revealed that the CEO, with a $10 million salary was receiving a Christmas bonus of $25 million plus. Other high ranking execs at Verizon were also benefiting from end-of-year big bucks. My immediate reaction was “Why does someone making $10 mil a year need a bonus? Can’t they live on the $10?” Then I began trying to mathematically figure out how many jobs might have been saved by re-routing that bonus money.
Others seemed to have the same question and an editorial in the Times challenged Verizon. A PR consultant for the latter responded in a letter to Times editor, explaining that the bonuses are necessary to keep the best persons on board in a competitive corporate market.
Now, I told you that I was not an expert on economics, but I do know something about bullshit. If they were the best, why did the company have to axe 2,500 workers? When that happens, the company can’t deliver the best service to customers. It might explain why when you call Verizon you are kept on hold listening to canned music. In fact, try calling Time-Warner, Con Ed, or any other large company and you are told that operators are helping other customers. There are not enough workers on hand to provide swift customer service. Or perhaps they are on other phones calling you to expand their share of the marketplace.
In the last fortnight, there seems to be much shock about the unmitigated chutzpah of some corporate CEOs who received government bailouts and then went on buying sprees. Citigroup was stopped just short of tossing out $50 million for a corporate jet seating 12 persons after receiving $45 billion in taxpayer funds. (They’re expected to be protected by tax dollars from all but $29 billion of their potential $306 billion losses.) I can’t keep up with all the reported obscenities but the $87,000 rug seems to have caught the media’s fancy.
And then came the report that John Thain, the canned CEO of Merrill Lynch, offered $4 billion in end-of-year
bonuses for 2008 following his company’s failings and the bailout paid by you and me. Maureen Dowd in The Times tells us money spent included $28,000 for curtains in Thain’s office, a pair of chairs for $86,000 and a $1,400 “parchment waste can”…whatever that is…
Guess what Thain’s explanation was on CNBC? He said “If you don’t reward the best people, you will destroy your franchise and they’ll go elsewhere.” If Citigroup lost $28 billion last year, how can they be the best on Wall Street and why should they be rewarded for a losing year? If they are the best perhaps Wall Street should go back to the drawing board.
Thain's rationalization was a carbon copy of Verizon's lame excuse. Obviously, Bernie Madoff isn't the only trickster on the street. It's an epidemic of legalized theft, a sense of entitlement married to incredible avarice.
Every day at the Fortune Society we deal with guys and women who served time for theft. Like the man who did 16 years for two burglaries to support his drug problem. What do you tell people who are struggling to change their lives after doing time when they are facing corporate America that closes its doors to them, and then they can see this massive chicanery...on this street from where I am broadcasting?
President Obama put forward a financial package this week and House Republicans challenged him...still the mouthpiece for the CEOs and their big bonuses and equally large, obscene tax breaks. You wonder if they will ever hear the rumbles from below. Madame DeFarge is knitting again.
The GOP and Fox puppets still whisper that frightening word "SOCIALISM." Perhaps they should spend more time examining the excesses of unregulated CAPITALISM... which has been a boon for a few and a nightmare for many during the last eight years.
I have no idea if Obama's financial package is the answer but I do know that the issuance of blank checks that the banks and Wall Street players have enjoyed since Reagan hit Washington, D.C. has to come to a screeching halt or we are all doomed…not from "terrorists" or "illegal aliens" or gay marriage. Guess where the danger is? What is it Pogo said? I have seen the enemy and it is us.
I’m David Rothenberg…out on a limb.
I am not Paul Krugman. In fact, I readily admit that the entire financial system and Wall Street maneuvers baffle me. I understand supply and demand but it seems to have disappeared with the Hula Hoop.
My inquiry was about some year-end machinations by Verizon. They had fired about 2,500 workers right before Christmas. It was then revealed that the CEO, with a $10 million salary was receiving a Christmas bonus of $25 million plus. Other high ranking execs at Verizon were also benefiting from end-of-year big bucks. My immediate reaction was “Why does someone making $10 mil a year need a bonus? Can’t they live on the $10?” Then I began trying to mathematically figure out how many jobs might have been saved by re-routing that bonus money.
Others seemed to have the same question and an editorial in the Times challenged Verizon. A PR consultant for the latter responded in a letter to Times editor, explaining that the bonuses are necessary to keep the best persons on board in a competitive corporate market.
Now, I told you that I was not an expert on economics, but I do know something about bullshit. If they were the best, why did the company have to axe 2,500 workers? When that happens, the company can’t deliver the best service to customers. It might explain why when you call Verizon you are kept on hold listening to canned music. In fact, try calling Time-Warner, Con Ed, or any other large company and you are told that operators are helping other customers. There are not enough workers on hand to provide swift customer service. Or perhaps they are on other phones calling you to expand their share of the marketplace.
In the last fortnight, there seems to be much shock about the unmitigated chutzpah of some corporate CEOs who received government bailouts and then went on buying sprees. Citigroup was stopped just short of tossing out $50 million for a corporate jet seating 12 persons after receiving $45 billion in taxpayer funds. (They’re expected to be protected by tax dollars from all but $29 billion of their potential $306 billion losses.) I can’t keep up with all the reported obscenities but the $87,000 rug seems to have caught the media’s fancy.
And then came the report that John Thain, the canned CEO of Merrill Lynch, offered $4 billion in end-of-year
bonuses for 2008 following his company’s failings and the bailout paid by you and me. Maureen Dowd in The Times tells us money spent included $28,000 for curtains in Thain’s office, a pair of chairs for $86,000 and a $1,400 “parchment waste can”…whatever that is…
Guess what Thain’s explanation was on CNBC? He said “If you don’t reward the best people, you will destroy your franchise and they’ll go elsewhere.” If Citigroup lost $28 billion last year, how can they be the best on Wall Street and why should they be rewarded for a losing year? If they are the best perhaps Wall Street should go back to the drawing board.
Thain's rationalization was a carbon copy of Verizon's lame excuse. Obviously, Bernie Madoff isn't the only trickster on the street. It's an epidemic of legalized theft, a sense of entitlement married to incredible avarice.
Every day at the Fortune Society we deal with guys and women who served time for theft. Like the man who did 16 years for two burglaries to support his drug problem. What do you tell people who are struggling to change their lives after doing time when they are facing corporate America that closes its doors to them, and then they can see this massive chicanery...on this street from where I am broadcasting?
President Obama put forward a financial package this week and House Republicans challenged him...still the mouthpiece for the CEOs and their big bonuses and equally large, obscene tax breaks. You wonder if they will ever hear the rumbles from below. Madame DeFarge is knitting again.
The GOP and Fox puppets still whisper that frightening word "SOCIALISM." Perhaps they should spend more time examining the excesses of unregulated CAPITALISM... which has been a boon for a few and a nightmare for many during the last eight years.
I have no idea if Obama's financial package is the answer but I do know that the issuance of blank checks that the banks and Wall Street players have enjoyed since Reagan hit Washington, D.C. has to come to a screeching halt or we are all doomed…not from "terrorists" or "illegal aliens" or gay marriage. Guess where the danger is? What is it Pogo said? I have seen the enemy and it is us.
I’m David Rothenberg…out on a limb.
Posted by David Rothenberg
