Sunday, March 15, 2009, AM | Leave Comment
While more than $2.8 trillion (a trillion is a billion spelled with a t) in retirement savings alone vanished and another $400 billion (a billion is a million spelled with a b) in taxpayer-financed loans were rushed to bail out troubled banks, financial executives gave themselves approximately $18.4 billion in bonuses. Here is a run-down of what the billions were spent on:
Former Merrill Lynch boss John Thain spent $1.2 million to spiff up his office in Manhattan. Quite a few things have been reported in the media, one of which was a $35,000 commode on legs.
In January, Thain announced his firm had lost $27 billion (a billion is a million spelled with a b).
Bank of America then took over Merrill Lynch with a $20 billion federal loan. What’s a $20 billion among friends.
What Thain did not announce was bonuses of $3.6 billion (that’s a b not an m) to top Merrill executives, including at least $1 million each to 696 of the firm’s 39,000 employees.
President Obama has blasted Wall Street C-Level executives and proposed a $500,000 salary cap for any CEO aided by the Troubled Asset Relief Program (TARP).
Populist anger may be getting through. Citibank, which received $45 billion in bailout funds, has canceled the well-publicized purchase of a $50 million private, 12-seat jet, and CEO Vikram Pandit said he was taking a $1 salary until his bank turned a profit.
V. Pandit and other banking executives traveled by Amtrak and commercial flights for a Washington tongue-lashing last month.
Moral of the story
Angry lawmakers included Rep. Michael Capuano, Dem. Mass., who said simply, “America doesn’t trust you anymore.” And that is how much the executive and legislative branches are willing to say and do. And that’s the way it is, folks. Now, if I could just figure out how to get credit to buy me a car.