Livinglies's Weblog

Another excellent submission from Allan. Just think where all that money came from for these wild bonuses and that the bonuses represent only 50% of the reported profits from each of the investment banks. Leaving aside all the money that went off-shore, we are still left with a direct correlation between the decrease in the wealth of middle-class homeowners and the sudden appearance of enormous profits on Wall Street in the middle of the most severe economic downturn in nearly a century.

GO TO: http://www.ourfinancialsecurity.org/

WALL STREET BONUSES COULD FUND AN ECONOMIC RECOVERY FOR MILLIONS OF AMERICANS

Submitted by admin on December 17, 2009 – 2:41 pm

Despite unleashing havoc on the global economy, Wall Street is on track to pay out an all-time record in bonuses and compensation this year. The nation’s six largest banks alone – Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Morgan Stanley – are on pace to give their bankers a staggering $150 billion payday.[1]

Click here to vote on how you would spend the $150 billion

Click here for information about protests about big bank bonuses in your area

The massive windfall for bankers comes straight out of taxpayers’ pockets. Yet while bankers use taxpayer assistance to enrich themselves instead of jumpstarting the economy by lending, federal, state, and local governments struggle to find the resources to clean up the banks’ mess, protect services, and create jobs.

If even a fraction of the big banks’ $150 billion in bonuses, benefits, and compensation (“bonus and compensation”) were used to fund important policy priorities, we could bring about a real economic recovery in this country:

$142 billion could fill the total budget gap for all 50 states for FY 2010;

$40 billion (just 27% of the total bonus and compensation pool set aside by top six banks) could finance a federal jobs initiative to create 1,000,000 jobs in early childhood education, in-homes services for the elderly and people with disabilities, and other community services through a federal jobs initiative;

$10 billion – about half of what Goldman will dole out to its bankers this year –could fund an increase to Head Start that would create 330,000 new jobs and better prepare children for school;

The full $150 billion could extend unemployment coverage for each of the 15,700,000 unemployed workers in the United States by seven months or buy individual health insurance plans for more than two-thirds of the nation’s uninsured, changing the lives of 31 million people in the process.
Bubble Bursts, But Bonuses Still Inflated

Bankers justified their massive paychecks by pointing to the outsize returns many investors received during the credit boom. But even after crashing the economy, bankers are still finding ways to lavish themselves with compensation. The bankers at the nation’s six largest banks – Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Morgan Stanley – are on pace to take home $150 billion in bonuses, benefits, and compensation in 2009, 19% more than their high during the peak of the financial boom in 2007.

2009 Projected Bonuses & Comp. 2007 Bonuses & Comp. Total bailout funds received*
Goldman Sachs $22.3 billion $20.2 billion $63.6 billion
JPMorgan Chase $29.1 billion $22.7 billion $94.7 billion
Bank of America $32.2 billion $18.8 billion $199.0 billion
Wells Fargo $26.3 billion $13.4 billion $36.9 billion
Citigroup $25.0 billion $34.4 billion $341.1 billion
Morgan Stanley $14.5 billion $16.6 billion $25.0 billion

This massive windfall for bankers comes straight out of taxpayers’ pockets. After taking nearly $17.8 trillion in bailouts to stay afloat, banks and other financial firms are still relying on taxpayer-funded programs to generate their profits. Along with the now-publicized TARP investments, debt guarantees, AIG payments, and emergency lending programs, big banks are also benefitting from a Federal Reserve commitment to pump $1.25 trillion into the market for mortgage-backed securities, which has fueled a speculative trading boom that is currently propping up bank earnings.

Banker Pay Could Fund National, State, and Local Priorities

Instead of ramping up risk-taking and lavishing bankers with excessive bonuses and compensation, the banks could be contributing to a real economic recovery. The top six banks are on pace to pay $150 billion in bonuses and compensation this year, which translates to $577 million every day or $72 million every hour. Even a small portion of the bankers’ total bonuses and compensation – just days or hours of pay, in some cases – could make a huge impact at the national, state, and local levels.

Provide relief to unemployed Americans

Less than half of the of the bonuses and compensation at the top six banks could fund the 14-week extension of unemployment benefits just signed into law by President Obama, providing relief to 15,700,000 unemployed residents of the United States.

Just 17 days of bonuses and compensation at the top six banks could fund the 14-week extension of unemployment benefits for all 2,200,700 unemployed residents of California.

In Illinois, 19 days of big bank bonuses and compensation could pay for an even longer extension of unemployment benefits – a full year – for each of the 674,700 unemployed residents of Illinois

A mere 6 days of bankers pay could fund the year-long extension of unemployment benefits in Oregon, providing long-term assistance to the 211,500 unemployed residents of Oregon.

The bonus and compensation pool created by the big banks could fund 10 months of severance at full pay for the 5,452,000 laid off workers in the United States.

5.3% of that $150 billion bonus and compensation pool could fund a full-year severance package at full pay for the 249,000 laid off workers in Ohio.

Just 3% of bonuses and compensation at the top six banks could fund a year-long severance package at full pay for each of the 105,900 workers laid off in Massachusetts in the past year.

In the Washington, D.C. metro area, 1 % of the big bank bonuses and compensation – the equivalent of just 3 days of work for bankers at the top six banks – could fund the one-year, full-pay severance package for the region’s 37,000 laid off workers.

Award bonuses to every American worker

The top six banks’ bonuses and compensation could fund a $1,000 bonus for all 138,275,000 working Americans.

Provide health care for the uninsured

The bonuses and compensation at the big banks could fund health insurance coverage for 2 out of 3 uninsured Americans changing the lives of over 31million people.

In New York, just 8.5% of the $150 billion set aside by the top six banks could fund health insurance coverage for each of the 2,634,000 uninsured people in the state.

A mere 7 days of bonuses and compensation at the top six banks could fund health insurance coverage for each of the 764,000 residents of Washington who are currently uninsured

Another 7 days of bonuses and compensation at the top six banks could fund health insurance coverage for the 746,000 currently uninsured residents of Indiana.

A single day of bonuses and compensation at the top six banks could make health insurance more affordable for 88,785 laid-off workers by extending the federal government’s subsidy of COBRA premiums for nine additional months. Forty-four days of big bank bonuses and compensation – or 17% of their total compensation and bonus pool – could fund the entire $25 billion cost of an extension, benefitting an estimated 7 million laid-off workers and children.

Provide relief to families facing foreclosure

Just 23% of the big banks’ bonuses and compensation could prevent or postpone every foreclosure projected for the United States in 2009-2012 by providing mortgage payment assistance to 9,000,000 families.

7.2% of what the six banks are setting aside for pay – the equivalent of just 19 days of bankers’ bonuses and compensation – could prevent or postpone every foreclosure projected for California in 2009-2012 by providing mortgage payment assistance to 1,888,716 families.

A single day of the big banks’ bonuses and compensation could prevent or postpone 89% of the foreclosures projected for Massachusetts in 2009-2012 by providing mortgage payment assistance to 107,977 families.

In Illinois, just 6% of what JPMorgan Chase alone is expected to dole out in bonuses and compensation — $1.7 billion – could prevent or postpone each of the 384,490 foreclosures projected for Illinois in 2009-2012.

A small percentage of the bonuses and compensation at the big six banks could even help buy back homes which have already been foreclosed on.

A mere 9% of the bonuses and compensation at the top six banks could buy back each of the 113,570 homes in Ohio in foreclosure in 2008 or each of the over 50,000 homes in New York lost to foreclosure during the same period.

Just 4% of the bonuses and compensation at the top six banks could buy back each of the 45,937 homes in Indiana lost to foreclosure in 2008.

Another 3% of the top six banks’ bonuses and compensation could buy back each of the 18,001 homes in Oregon in foreclosure in 2008.

Award college scholarships for all American students

The bonuses and compensation pool at the top six banks could fund a free public education and a $2,774 cost of living award for each of the 15 million students in the United States.

Just 9% of the $150 billion set aside by the top six banks for bonuses and compensation could fully cover the cost of an in-state public education for each of the 2,257,000 college students in California.

3% of the bonus and compensation of the big banks could pay the cost of an in-state public education for the 421,000 college students in Massachusetts.
7% of the bonuses and compensation of a single bank – Bank of America – could cover the cost of an in-state public education for each of the 321,000 college students in Washington.

Increase Social Security benefits for America’s seniors

Just 6 days of bankers’ bonuses and compensation could fund a 5.8% cost-of-living adjustment in 2010 for each of the 51 million Social Security recipients in the United States, providing relief to seniors after the Social Security Administration announcned there would be no COLA for the first time since 1975.

The top six banks could fund could fund the COLA increase for each of the 2,021,874 Social Security recipients in Ohio in 2010 with just 2 hours of bankers’ bonuses and compensation.

In Illinois, 8 hours of bonuses and compensation at Bank of America alone could fund a COLA increase for each of the 1,948,578 Social Security recipients in the state.

A mere 22 minutes of Goldman Sachs bonuses and compensation could fund a 2010 cost-of-living adjustment for each of the 71,468 Social Security recipients in DC.

The $150 billion in bonuses and compensation at the top six banks could be used to increase every single Social Security recipient’s monthly benefit check by $245 (nearly $3,000 annually). That would be a 23% increase!

Provide state and local budget relief:

The bonus and compensation pool at the top six banks is roughly equivalent to the budget deficit of all state governments. Instead of lavishing millions on bonuses for the very rich, small percentages of the bankers’ pay could go a long way to filling huge holes in state crises and providing valuable and needed services to families.

Just 6 days of bonuses and compensation at Bank of America alone (or 2.2% of the $32.2 billion Bank of America is setting aside for bonuses and compensation) could restore over $700 million in cuts to California community colleges.

A mere 1.4% of the bonuses and compensation at JPMorgan Chase could restore the $405 million New York City was forced to cut from its Department of Education budget.

3 hours of bonuses and compensation at Bank of America could fund the rehiring of 338 DC public schools employees, including 229 teachers, who were laid off in as the result of $40 million budget in budget cuts.

Another 3 hours of bonuses and compensation – this time at JPMorgan Chase – could have prevented $38 million of cuts in mental health and developmental disability programs and grants in Illinois.

[1] The $150 billion figure is an estimate. The top six banks set aside $112 billion for bonuses, benefits, and compensation in the first three quarters of 2009, or $37.3 billion every quarter. At this rate, their total compensation pool for all four quarters will total approximately $150 billion for the year.

* Bailout calculation includes funds received under the TARP program and other government sponsored or funded financial assistance mechanisms.

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Out of habit, I tend to hold my own conspiracy theories up to criticism or to the feedback of those I trust, but here, somehow, I feel there truly is a huge ’stealth’ transfer of wealth underway from the soon to be ‘have nots’ to the ‘haves’, except it ain’t ’stealth’. It’s all being accomplished in plain sight, right out in the open, and feels a bit like requiring those who are about to meet their demise dig their own graves. All done with the impunity of knowing those who are supposed to impose checks and balances for the health of the system, are giving the predator bankers the green light.

While our government is coddling the big banks and going easy on them all in the interest of maintaining economic stability, million of lives are being ruined needlessly. Who’s manning the switch on the vision thing that is allowing this to continue unabated?

Let the world know we are Americans who are for real financial reform. This heartless plunder must stop! Why does it feel so like the land grabs that go hand in hand with ethnic cleansing (or witch trials), except packaged in the legitimizing process of law, where too often justice takes a back seat to power and influence? Where are the Portias of the world when we so need them to balance upholding authentic contract with doing equity?As Portia in Act IV, Scene 1, addressed Shylock, the merchant of Venice:

“The quality of mercy is not strained.
It droppeth as the gentle rain from heaven
Upon the place beneath. It is twice blest:
It blesseth him that gives and him that takes.
Tis mightiest in the mightiest; it becomes
The throned monarch better than his crown.
His scepter shows the force of temporal power,
The attribute to awe and majesty,
Wherein doth sit the dread and fear of kings.
But mercy is above this sceptered sway;
It is enthroned in the hearts of kings;
It is an attribute of God himself;
And earthly power doth then show like God’s
When mercy seasons justice.”

The Merchant of Venice,
~ William Shakespeare

GO TO: http://www.castroller.com/podcasts/BillMoyersJournal/1375428

ALLAN
B e M o v e d @ A O L . c o m

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