What were bankers and Wall Street CEOs thinking? While $2.8 trillion in retirement savings vanished and $400 billion in taxpayer-financed loans were rushed to bail out troubled banks, financial executives gave themselves some $18.4 billion in bonuses.
Conspicuously, former Merrill Lynch boss John Thain spent $1.2 million to spiff up his Manhattan office, with, among other things, a $35,000 “commode on legs.” In January, Thain announced his firm had lost $27 billion. Bank of America then took it over with a $20 billion federal loan.
What he didn’t announce was bonuses of $3.6 billion to top Merrill executives, including at least $1 million each to 696 of the firm’s 39,000 employees. President Obama has blasted Wall Street chieftains and proposed a $500,000 salary cap for any CEO aided by the Troubled Asset Relief Program.
Populist anger may be getting through. Citibank, which received $45 billion in bailout funds, has canceled the well-publicized purchase of a $50 million private, 12-seat jet, and CEO Vikram Pandit said he was taking a $1 salary until his bank turned a profit.
Pandit and other banking executives traveled by Amtrak and commercial flights for a Washington tongue-lashing last month. Angry lawmakers included Rep. Michael Capuano, D-Mass., who said simply, “America doesn’t trust you anymore.”
Blair S. Walker, who frequently writes for the Bulletin’s In the News section, lives in Miami.