"Corporation. An ingenious device for obtaining individual profit without individual responsibility."
This is truly an amazing constellation of stories, starting with one from the NY Times (via kos). In it, the reporter tells us what’s going on with executives from Swiss-owned USB, a financial beast (it hardly makes sense to call these behemoths ‘banks’ anymore, does it?) that gorged itself on the sub-prime loan feeding frenzy like many of its US counterparts. And like its US counterparts, USB took a big hit when the shell game of bundled sub-prime loans finally reached the breaking point -- to the tune of $50 billion. And the company is on the hook for more than that to the Swiss government in order to remain solvent.
So, what did the former president of the bank, Marcel Ospel and two former bank directors do? They offered to give up more than $27 million in compensation they would have received.
These guys said, if I may paraphrase, “Hey, you know what? We fucked up. Whew! Boy do we ever suck at this. We thought we were smart, but we clearly suck ass at this whole making money thing -- apparently, huh? Ha ha! No, seriously, we got duped by the allure of a fast-money scheme, and we should have known better. And we lost our investors $50 billion or more, not mention ruining our good name, and that of our company, and possibly the economy of our nation in the process. So, you know what? Mea culpa. Keep your $27 million. Compared to all that shame, what’s a few million extra -- especially when we’ve already made a killing in the process of fomenting all this destruction?”
Makes sense, right? Put that on a resume: Lost $50 billion, blew up a formerly respectable company and helped to damage and possibly destroy the entire economy of not only my nation, but the entire planet.
Talk about a bad employee review. You sure as hell don't ask for a raise or a bonus after a quarter like that. It makes sense that they wouldn’t take the money. But the funny thing about this story to me is the incredulity of the American reporter, and his US-based sources when reporting on this. To wit:
“In the United States, lawmakers and regulators have expressed profound frustration over a perceived lack of remorse among executives who made millions while peddling investments in securities whose plummeting value has pushed the financial system to the brink of collapse. Executives have resisted cuts.”
‘PERCEIVED lack of remorse?’ What personal remorse, or honest assessment of mistakes made by individual CEOs of these bailed-out corporations have you heard? All I hear about is how the ‘climate’ and the ‘markets’ and the ‘cycle’ of a ‘perfect storm’ of business-y business stuff blah blah...and then the markets, and consumer price index blah blah -- oh, and how it's Congress' fault. Or Clinton's fault. Or Obama's fault. Or the librul's war on christmas' fault. And basically never mind all that, taxpayers. Just hand over the bailout money.
And here’s a Stanford professor’s take on it:
“That is almost unheard of,” Dirk Jenter, an assistant professor of finance at the Stanford Graduate School of Business, said of the move by the executives. “They’ve clearly been shamed into doing that.”
Shame. What an incredibly alien idea, what an unspeakably foreign concept, what a mind-blowing, perversely deviant, bizarre notion, what a ticklishly unique and strange proposal for a business school professor to contemplate. One can only imagine that having had this utterly unfamiliar thought, said professor was instantly launched into a bizarre dreamland wherein Ben Stein sits on a giant mushroom smoking a hookah and Henry Paulson screechingly rearranges the seating.
Thank you, Stanford Graduate School of Business, for the fine work you have done in training the legion of soulless dipshits who helped bring all this about. Please, o please, continue instructing the best and the brightest shining lights of the business world and continue to send them to Wall Street so they can start to seed the cycle all over again using taxpayer bailout money.
Because basically the entire thing is a sham. I forget who said that money is really just a shared hallucination, but this crisis really paints that, wouldn’t you say?
For a spot-on dissection of the sub-prime loan issue and how things came to this pass, read this article, by Michael Lewis. He’s the guy who wrote ‘Liar’s Poker’ back in the 1980s about that decade’s Wall Street fiasco -- and he posits pretty strongly that the seeds of our current crisis lie in changes that took place back then.
The article is long, and a little dense at times, especially for those of us who ain’t so good with numbers and what-not. But it’s a fascinating read -- and it’s worth it, if you want to understand what’s happened. Trust me.And finally, here's a little Ween to send you on your way, playing a song that sadly, no thinks should rightfully be stuck in Bush's head the rest of his life. Same applies to the Masters of the Universe on Wall Street.