Division from Main Street to Wall Street
If there wasn't a divide between Main Street and Wall Street, there is one now. And it's crucial that Wall Street understand it if it ever hopes for an economic recovery.
The retention bonuses paid to insurance giant AIG in the financial services division of the company - the same unit that dove head-first into the risky credit default swaps that spread like a contagion through the world financial system - sparked an outcry from all corners of America.
On Wall Street and inside AIG, they scratched their head at the level of anger over the bonuses. After all, the so-called "best and brightest" had come to count on their fat bonuses after good year and bad, and was no more based on performance than their salaries.
Here on earth, people who fail generally don't get bonuses. Heck, people who do great work often don't get bonuses. In fact, many people, despite hard work and through no fault of their own, lost their jobs because of the economic crisis brought on by crazy risks taken by homeowners and Wall Street.
The prevailing mood in the country is that Wall Street's exotic (and now toxic) financial instruments led to wild risk-taking. That a company known for insuring the world didn't understand risk is appalling. No one can argue AIG, Bear Stearns or Lehman Brothers had a good year, or even a bad year. Nearly crashing the planet's financial system can only be seen as a gigantic failure. And they don't understand why someone would question their bonuses.
That taxpayer money had to be used at all to prevent AIG from going belly-up is disgusting. Having that money used for paying bonuses to those responsible is reprehensible.
In the real world, people who fail get fired. They don't get bonuses. In the real world, people who nearly crash the planet's financial system should be looking for a new planet.
Getting mad doesn't solve much, but that doesn't mean we're not going to get mad. We're entitled to be mad.
But most importantly, Wall Street, which has been asking the question, "When will people put their money back to work in the stock market," has been given its answer, but fails to recognize it. The simple answer to that simple question is this: not until those people who pull the levers of Wall Street understand that people who fail should be punished and people who succeed should be rewarded.
WADENA PIONEER JOURNAL