Sometimes you have to take a look at the way Americans think, and cringe. The current apologia circulating the business world was laid out in Roy C. Smith's essay in the Wall Street Journal, effectively saying this: the public may bemoan the crazy-ass salaries and bonuses garnered by execs and CEOs of financial institutions, but if we didn't pay them so much, we would lose their considerable talents. In other words, these people are worth millions upon millions in compensation because failing to pay them threatens America's economy.
I suppose you know where I, Angry McLeftypants, am going with this: Smith's idea is mired in such unwavering BULLSHIT that I'm actually tempted to call it poppycock. Let's break it down, shall we?
1. First off, aren't these irreplaceably talented motherfuckers the ones that got us into this quagmire in the first place? How can anyone, with a straight face, say that the higher-ups at Lehmann Brothers are worth more than the GNP of Belize? If we've learned anything in the last decade, it's that Everyone's Faking It Except Ear, Nose and Throat Doctors. It's also apparent that the culture of exorbitant bonuses has not ultimately done these big companies any favors. John Thain spent $35K on a commode - all kidding aside, how exactly did that help Merrill Lynch?
2. Second of all, I get the principle: if you have more responsibility, you get paid more. As recently as 1990, CEOs received, on average, 85 times what a normal worker received - about like it is in other countries. But by 2005, that number had jumped to 411. That's goddamn insane.
Our country truly came into its own after WWII, an expansion and growth unsurpassed in modern history. And it all happened with a low, ethical, morally-sound pay gap between workers and execs. Now Roy C. Smith is telling us it can't be done unless we lavish manna at the feet of CEOs? To paraphrase the Squirrel Nut Zippers, if it's good enough for Grandpa, it's bloody well good enough for us.
A humongous pay gap undermines morale, ruins the hierarchy, and actually makes companies perform worse. My heroes? Dan James and the folks at silverorange. Hugely successful company, some of the biggest clients on the Web... and Dan, the CEO, makes the same salary as his newest, youngest code writer. Genius. Those guys engender cult-like respect, and rightly so.
3. Here's the most important thing: if our best and brightest don't choose to go to Wall Street because billions of dollars aren't being offered anymore... isn't that good news? Take it from me - I've seen the greatest minds of my generation... well, I've seen the greatest minds of my generation smoke a lot of pot and waste the years 1990-1997. But the other greatest minds of my generation could have gone into science or medicine, but the allure of banking $$$ was too much for anyone to deny.
These people could have discovered an alternative energy source ten years ago, and we'd already be off gas. One in particular was a chemist who was working on the Genome Project. Another was processing an industrial chimney scrubber that never saw the light of day. In EVERY CASE, the Wall Street headhunters found them in grad school - or on a summer internship - and they were whisked away. Don't blame them; they were 22. What would YOU have done?
I posit this: Roy C. Smith is so myopic about Wall Street bonuses that he can't see what others might: if it weren't for the gadzillions of dollars thrown around lower Manhattan over the last 20 years, there would have been a cancer vaccine.Posted by Ian Williams at February 8, 2009 11:04 PM