Are The Massive Wall Street Bonuses Justified?

In 2010, Wall Street paid itself a record $135 billion, despite the U.S. Economy still being in shambles. This despite millions of people out of work, home foreclosures mounting, U.S. gov't and trade deficits at horrific levels and many cities cutting teachers, police and fire services. Are these Wall Street bonuses justified?

To many people, including President Obama, the answer is no, in part because of the bailouts many of their firms received. These firms are now highly profitable because of support the gov't continues to provide such as a flood of more cheap money and lax regulation and flexible accounting standards. Meanwhile savers are paid record low interest rates while these firms make a huge spread on their money.

These Wall Street executives never accepted responsibility for the 2008-09 financial meltdown nor have any of them ever been held accountable. For Wall Street it is back to business but even better than usual.

The troubled U.S. economy is not their responsibility. Despite the bailouts, the gov't didn't cap their income and these Wall Street bankers take a percentage of the profits their firms make. Thanks in part to continuing gov't support, these profits are huge. This in turn is driving the stock markets through the roof, also adding to Wall Street's profits. Hopefully these bankers are paying some taxes on this income.

There is something else worth noting. It is the new concept of "too big to fail," which leaves Wall Street free to take irresponsible actions again in a race for ever bigger bonuses.

If you think this is unfair, then speak up, for in your silence Wall Street makes big campaign contributions to both parties, whose politicians actively solicit this money, including our president whose representatives are actively fund raising for his 2012 campaign. No surprise, this corrupt system is allowed to continue.

If you would like to explore Wall Street bonuses further, Steve Eckhaus, an attorney who represents hundreds of these Wall Street bankers was interviewed by The Wall Street Journal and he explains the justification for their pay. http://online.wsj.com/article/SB10001424052748703399204576108380072356842.html

Dick