OK,\u00a0 Wall Street collectively earned $18 billion in bonuses.<\/p>\n
After the NY Comptroller’s report yesterday<\/a>, BDS has come into full swing.\u00a0 President Obama gave a wag of his finger<\/a>.\u00a0 Many in our\u00a0anti-business media<\/a> are piling on with psychobabble<\/a> dressed up as analysis.\u00a0 Now, the Davos clique, striving for relevance, is chiming in<\/a>.\u00a0 And check out how hot “b” can sound when enunciated by the babe in the MSNBC video<\/a>.<\/p>\n The comptroller’s report itself did not contain the outrage it provoked.\u00a0 In fact, it noted that the lack of these bonuses had a material impact on the ability of the state and city to finance public services, reinforcing the truth of what P. J. O’Rourke once said about the value of the undeserving rich:<\/p>\n The worst leech of a M&A lawyer making $500,000 (he wrote this in 1992) will, even if he cheats on his taxes, put $100,000 into the public coffers.\u00a0 That’s $100,000 worth of education, charity or U.S. Marines.<\/em><\/p><\/blockquote>\n What is shameful, I think, is the PR problem Wall Street has created for itself by mislabeling what it pays its producers as “bonuses.”\u00a0 Wall Street, like any other enterprise, depends on its talent, such as it is.\u00a0 And, like any other enterprise, the famous 80\/20 rule applies–about 20 percent of its talent generates about 80 percent of its revenue.\u00a0 Rather than pay all its talent equally, they give these people base salaries that would barely keep them in a small Manhattan apartment.\u00a0 These folks need to earn up to their competitive level of pay through “bonuses” based on their production.\u00a0 So, whereas most people in the country think of a bonus as something “extra” awarded for very good performance, on Wall Street most of these bonuses resemble commissions earned by a modestly salaried salesperson.\u00a0 The I-banks like to call them bonuses because it sounds better to the employees they wish to attract and retain.<\/p>\n