The news that the top 30 Goldman Sachs executives will receive no cash bonuses for 2009 comes, on reflection, as no real surprise. Instead Goldman bosses will receive shares that have to be held for at least five years – an elegant solution.
This is smart. But there seems to be an enormous time-lag in other parts of the financial services industry, with some bankers (anonymous spokespeople, usually) still expressing outrage that their cash bonuses should be questioned and now, in France and the UK at least, taxed.
Most extraordinary of all has been what I like to think of as the angry teenager’s defence. This is sometimes seen when parents come home to find that an unofficial evening of debauchery and drunkenness has taken place in the family home.
“It’s your fault!”, the angry teenager declares. “You should have hidden the drinks better! Yes, I admit I have been sick on the priceless Afghan rug. But you let me do it. You practically made me do it.”
This effectively paraphrases an argument I have heard from some bank spokespeople. “It’s not our fault that the world’s financial system was brought to the edge of collapse. The regulatory environment failed,” it is said. “Now don’t you dare tax our bonuses,” – made possible, of course, by the taxpayer support that propped up an entire industry – “or we will leave. You mustn’t force the talent out.”
I know I am not alone in thinking that, if it did leave, at least some of this supposed talent might not necessarily be all that badly missed.
PS My colleague John Gapper has also commented on this story here.
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