Bailout Bonuses For Investment Bank Execs

CBS Evening News: Despite Taxpayer Bailout, Wall Street Firms Plan To Dole Out $14 Billion In Year-End Bonuses

(CBS)  One of the recipients of the taxpayer bailout is still struggling. CitiGroup said Monday it plans to cut 53,000 jobs by early next year, one of the largest layoffs ever by an American corporation.

And what about the big bonuses Wall Street executives count on at this time of year?

Despite massive layoffs, dismal earnings reports, and a rescue check from the federal government, CBS News correspondent Priya David reports Wall Street investment firms still plan to hand out roughly $14 billion in year-end bonuses.

Now the industry leader, Goldman Sachs, has announced its top seven executives will forgo bonuses, stock and option awards this year, compensation packages totaling more than $300 million. Banking giant UBS followed suit.

"They've received billions of dollars from the public and to receive bonuses in the face of all that would have appeared to be piggish," said compensation consultant David Schmidt of James F. Reda & Associates.

Schmidt says Goldman Sachs was under tremendous pressure to cut bonuses, but it may just be a drop in the bucket compared to smaller bonuses thousands of rank-and-file employees get.

In light of today's job cuts, New York Attorney General Andrew Cuomo is calling on CitiGroup and AIG executives to drop their bonuses too.

"People are upset, and with good cause," Cuomo said. "You have people who have seen their life savings go out the window, and they did nothing wrong here.

"They were then called on for a trillion dollars to bailout the institutions that caused the problem in the first place."

More than excess, analysts say it's the compensation structure that's partly to blame for Wall Street's meltdown, a system that encouraged risky behavior to get bonuses.

"The more money you can bring in to the firm, the more you're gonna receive in terms of bonus," Schmidt said. "For those who are making those deals, if for some reason those deals don't work out, the personal repercussions are probably not what they should be."

Analysts say these executive bonus cuts are mostly a public relations maneuver, a rare case on Wall Street where taking less means more.

[hitoyou1]

Scum that is all they are, Congress and the bankers. SCUM

[notopennshut]

Any entity that has received money from the government for bailout to help them out of the mostly self-created mess SHOULD NOT AND MUST NOT be rewarded with bonuses, whether it be the CEO or the office clerk!! They cannot use this money to reward themselves.

[lstra2308]

Why is banks and auto makers more impotant then me? They have ripped us off for years. You make a deposit,your 5 short on a check that comes in, they take out a 35 dollars fee, then give me credit for my deposit.
I''m a grandmother, my daughter and grandchildren live with me and my husband who is disable. Because their dead beat father won''t pay child support and no one makes him. My savings is gone buying food for all of us, we can''t get food stamps.I have no health insurance. My 3 grandchildren are good kids 13, 15 16. I so wanted to buy them each a laptop for Christmas, (we have one old computer) they all use it to do their homework on and it is hard,because if one takes to long the other one has to hurry to get done.But now that hope is gone, I just don''t have the money, food, gas and lights, and water is a need not a want.

[slim1h2o]

Go get''em Andy....

[zietzke-2009]

"BOOK EM DANNO" Grand Theft / Larceny. 700 Billion Counts !!

[mstrogan61]

If you want to bail out the the car companies then you should make a stipulation they have to bring the companies back to the United States!!! After all we the people of the United States of America will be paying for it! Therefore that would bring back our Jobs, money will be circulating in the United States instead of Mexico or anywhere else, and the economy would be better and we would get our jobs back. Because I don''t beleive that we th3e people of the United States should be paying for taxes on a bailout for a company that has moved to mexico or anywhere out of the United States! and we should get better prices on vehicles!

[tbuckl]

All hands on deck! All hands on deck! She is going down at the bow, abandon ship! abandon ship! Man the life boats. All hands on deck, this is not a drill, this is not a drill, man the life boats. Mayday mayday this is USS American we are taking on water and going down, Mayday mayday this the USS Americna we are taking on water and sinking, life boats are being deployed, we are abandoning ship at this time.

[longtree-2009]

anyone receiving any amount of bail out money should not be allowed to give out bonuses. if they do, the money should be taken away and they should be made to repay the amount already spent within 60 days or all executives are arrested and sent to prison for fraud.

[mcdonaj3]

Not a problem. Offset the bailout money against the bonus money. If a company has enough profit to pay the bonuses, I think it can squeeze by without the bailout.

[sassalin]

lstra2308,

I am sorry for your situation. There are programs out there that will help you get laptops for free or a discounted price. Search the internet and you may find a few.

laptop.org

Also, look on DEll or other companies and they sell their returned computers at a discounted price. Most of the time there is nothing wrong with them.

I wish you the best.

[neenga]

autumn987, can I have some of what you''re smoking?

[nothappyatall]

reports Wall Street investment firms still plan to hand out roughly $14 billion in year-end bonuses. "

What did you expect? remember who PUSHED big for this- GW BUSH and his crime cartel of course.

[lilly1232]

'''' .. don''''t shift shapes & toggle virtual & realtime & travel eternitys at speeds of thoughts, you don''''t have infinite divergence with infinite wishes come true & infinite lines resolution with infinite fast refresh .. you''''re all just little dressed diligent sober celibate intransient adult subsistance soldiet bits of dust magically erupted in depths of endless oblivion .. not infinite oceans of lazy naked lusty dopey transient kid subsistance farmet eternal storyboards swimming & drifting infinite oceans of eternal storyboards .. ''''



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Posted by autumn987 at 11:56 AM : Nov 18, 2008

Huh? does anyone have a clue as to what she said, or who she said it too????????????

[fduran2848]

hmmmm.....my company lost money this year therefor I get no bonus....I guess I''m working for the wrong company.....

[sherie6918]

Criminal!! Any company, bank, Wall Street firm, that takes part in the federal bailout program should not be allowed to pay out bonus payments or stock options!!!! This is something that continues to squeeze employees and tax payers. Pay to CEOs should be more closely monitored. If the company is not making a profit, management should not recieve payouts!!!!!!!!

[joethedumber]

bush=bail out banks, leave individuals to rot.
Listen how the right wing neocons call people"Stupid" for being it debt. And they dont attack the trillion dollar corporate bail out already given.

[mstrogan61]

you are right she is saying the goverment is raping the people that need help to help the big wigs

[mstrogan61]

Top Ten reasons why we should bail out the Car Companies.
1.So the CEO''s could buy a neck tie to hang themselves with.
2.So Joe the plumber and Jill the Health care Provider, can take it up the pipe 2x instead of 1x.
3.Americans won''t have to work just let the Mexicans do it.
4.to keep the big wigs out of the welfare line.
5.All car BUYERS start a business to recieve a BAILOUT.
6.No Americans has to pay bills except for their car payment.
7.So car companys can move their companies to Mexico and receive a Bail out from the United States.
8.Sorry Kids can''t eat because we have to support the Car Companies.
9.Lower gas prices.
10.Great Credit for Americans.

[washeyp]

Since it is the norm to give year end bonus, I have no problem with that BUT the tax rate on such bonus MUST be 110% for those earning over$150,000.00 per annum......

[frogleg2]

Most Americans probably look upon the wall street bonus system askance and with some humor . Can one be sure which executive preformed well and which did not. If is simply about how much money flowed in from your efforts then a bonus for super performers is in line. Including a balance of ethics and dollar producing gives us a different set of values to measure performance. Of course looking at it from a judgmental, subjective viewpoint most feel that everyone on Wall Street should get a bag of coal.

The noble act of giving up these bonuses is probably a mix of corporate guilt and good press. A lot of people have lost their life savings and took a fatal hit to their pensions, perhaps they should be given a year end bonus. There is now way to estimate the damage at this point but I feel it is an obscene act to reward the people who brought down the economy and mismanaged us into a dark corner and super sized their earnings. One of the things I learned as a child is that once a bully took away your little red wagon he most likely would never give in back. The federal government is going to bail out the captains of industry with billions then I think the captains of industry should be required to bail out the average American with haste and strict guidelines and not hoard the money for times of higher profit. I say give them bags of coal to be redeemed for dollars after they make a signifiant contribution to the recovery of the terminally ill economy.

[king_daniel_]

if the auto swine created better cars with less dependancy on oil and gas and less smog for us to smoke they would sell more cars worldwide...however they opted to jump in bed with the oil companies.....with designs that get worse mileage than tanks.....our government shouldn''t bail them out....haliburton should...since it was them that paid the board to say that 14 miles a gallon is as good as it gets.....i hope they all lose their jobs and a company thats not in an orgy with the conspiracy artists comes to power with something that applies technology under the hood where it should be...there was a crack head in texas that took parts from his refrigerater and was getting sixty miles a gallon....there is a man in oklahoma, named steven myers i believe, that has a steam engine he built in his garage that is amazing, find it on youtube.... if an average person can make a million dollar design look stupid; it only makes sense they can''t make any money.....