Once again politicians are trying to transform bankers into cartoonlike villains, responsible for every disaster that has befallen the U.S. economy for the last quarter-century.
President Obama is considering a tax on banks and financial service firms, and New York Attorney General Andrew Cuomo has asked several banks to turn over information about bonuses based on last year’s earnings.
The financial sector has responded defensively to the orchestrated public outcry. Goldman Sachs is considering a plan that would force executives to donate to various charities, a move that would fly in the face of traditional ideas of charitable giving. (Isn’t charity supposed to come from the heart, rather than from a mandate?) Other banks clearly are worried about public perceptions as they prepare to pay out bonuses to high-achieving employees.
This is insane. Bonuses should not be subject to regulation, they should not be subject to unfair taxation (as they are in Britain) and they should not be seen as something evil.
Unfortunately, political figures across the spectrum seem eager to point fingers at high achievers in the private sector.
People who live in the New York region should be cheering rather than snarling as Wall Street passes out rewards. A big bonus season can and will deliver benefits to the entire regional economy. Employees who get bonuses shouldn’t be made to feel guilty, any more than politicians feel guilty about getting taxpayer-supplied perks.
Bonus payouts are good for the economy. They create jobs at a time when jobs are scarce, and they create a demand for goods and services.
Isn’t that a good thing—for everybody?