Do you follow Aaron Task & Henry Blodgett? They have a video blog on Yahoo!Finance. Yesterday, they had a segment that was so outrageous that it bears repeating. In short, simple sentences, it goes like this:
John Thain used to be CEO of Merrill Lynch.
Merrill got into bad financial trouble. They stood to lose $15B. They needed help from taxpayer funds. They needed to be acquired by B of A. Oh, and they paid out $15B in executive bonuses that same fiscal year.
Then, they allocated another $4B secretly for more executive bonuses. Usually Merrill hands out gobs 'o cash to their top trough feeders in January, but since the acquisition by B of A was going through, John Thain pushed the bonus program up into December. Evidently there was risk that B of A management might not allow the bonuses.
Oh, and during the same period, Thain spent on the order of $1.2M to redecorate his office at Merrill.
The Old Amigo can't help but notice that the entire State of Washington is facing, oh, a budget deficit of between $3B and $4B for 2009. The state legislature is trying to decide what programs need further cuts. Under consideration: $1B cuts in public school funding, cuts in health care for children, and cuts nursing home care for the elderly. Oh, and taxes will go up too.
And the year before, Merrill's executives walked away with $19B.
It is not clear that any of Thain's actions are actually illegal, but if you had any doubts about what passes for ethics in America's executive conference rooms, one could hope that those doubts are now settled. The "invisible hand of the market" once again doles out massive amounts of slop to those already feeding at golden troughs, while slapping down the less powerful.
Shifts of wealth on this scale are not merely greedy, selfish, and disgusting. Shifts of wealth on this scale actually threaten the future of our country. When we, the middle class, cannot educate our children; when uninsured cannot get health care; when we do not care properly for our elderly we unravel the fabric of our society. We damage our place in the community of nations.
But Thain and his cronies get their mansions, their yachts, their private planes. One can but wonder how often this story plays out all over our country.
Are you paying attention now?
3 comments:
(I tried to edit one word in my previous post, but failed...lol...here it is again.)
I am totally outraged!! These greedy, unethical bastards need to be taken down somehow.
Regarding budget deficits; I was just at a local school board budget crisis meeting last week and due to proposed budget cuts by the state we must cut $5.5 million from our budget for next year. We have been going on a shoestring for so long this is going to be difficult. Just last year we were able to put instrumental music back into the elementary schools for the first time in ten years and now that will be the first program to be cut.
Your description of these greedy moneygrubber's practices and the consequences of their actions is very accurate, Amigo.
Thanks, Al. I am glad that you found my article reasonably sound. Honestly, I think that we can and should keep trying to elect decent people who try to do the right thing. We also need to remember that we "vote" every time we reach for our wallet. That is something that I need to remind myself often.
I hope that your local school district recovers as quickly as possible.
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