February 11th, 2009
06:38 PM ET

When it comes to bankers, I so miss hanging

[cnn-photo-caption image=http://i.l.cnn.net/money/2009/02/11/news/companies/congress_banks/banking_ceos_090210.gi.03.jpg]

David Gewirtz | BIO
Editor-in-Chief, ZATZ Publishing

I miss hanging. Beheading is nice, too, but it's more messy. Besides, with a good hanging, you get to watch legs flail. And nothing beats legs a-flailin'.

Why, besides simply an appreciation of the art, do I miss hanging? One word: bankers. You see, we recently gave some bankers at Morgan Stanley and Smith Barney, and the like a whole lot of money. Money measured in the billions. In fact, money measured something on the order of $60 billion for those two companies alone.

Why did we give them our hard-earned taxpayer money? Simple. They screwed up. They screwed up so royally that to let them fail might take the country down with them. Now, I've screwed up royally once or twice myself, but you don't see the government rushing to hand me $60 billion.

So, anyway, you'd think the world-class screw-ups that work for these banks would be thrilled they still have a job. After all, there are a whole lot of people who don't have jobs right now - and in many cases, it's the fault of the turkeys at the banks.

Apparently, these days, the folks at Morgan Stanley and such are even more thrilled to have a job, because they're about to get $2-3 billion dollars in not-bonuses. Yep, they're at it again.

These are now called "retention awards" and, according to co-president of Morgan Stanley James Gorman, they're being given to top employees at the bank so they don't leave to go somewhere else, possibly to destroy another entire industry.

Now, let me be clear. I have nothing against people making money. I like money. I don't even begrudge corporate executives making incomprehensibly obscene amounts of money. As far as I'm concerned, Bill Gates and Warren Buffet earned every penny they've got.

But I do begrudge giving companies huge amounts of taxpayer money as a result of poor management. I marginally accept the necessity, but I don't have to like it. But what infuriates me (and most of America, frankly) is watching that taxpayer money (or one sleight-of-hand bookkeeping trick away from being that taxpayer money) being given away as "awards" to the very same managers that caused the problem.

What's worse, the "retention awards" are calculated on 2008 numbers, which apparently gives these executives even higher amounts of cash. Once again, they're playing the greed card.

This time, though, they're playing with America's money. It really is time these people wised up and stopped trying to suck the system dry for their own personal enrichment. After all, they need to live within the system and gated community or not, if the economy implodes far enough, nothing's going to protect them from the people they've wronged.

I do so miss hanging.

Editor’s note: David Gewirtz is Editor-in-Chief, ZATZ Magazines, including OutlookPower Magazine. He is a leading Presidential scholar specializing in White House email. He is a member of FBI InfraGard, the Cyberterrorism Advisor for the International Association for Counterterrorism & Security Professionals, a columnist for The Journal of Counterterrorism and Homeland Security, and has been a guest commentator for the Nieman Watchdog of the Nieman Foundation for Journalism at Harvard University. He is a faculty member at the University of California, Berkeley extension, a recipient of the Sigma Xi Research Award in Engineering and was a candidate for the 2008 Pulitzer Prize in Letters.

Filed under: Bailout Turmoil • David Gewirtz • Wall St.
soundoff (66 Responses)
  1. Rafiq

    Well, hanging would be nice, but the problems would remain. What is missing in the whole 'bailout debates' is that things need to change. The "good old days" will not just be coming back. If they do, just for a brief period, it will only lead to bigger problems (and needs for more hangings). Instead it would be time to look at the Islamic Banking method. An economy of truly 'participating', both in risks and benefits, and not 'fixed interest benefits', which have now proved to be just a balloon to bust. As an example a "loan" to a farmer will be paid for not as a fixed interest but as a part in the future crop. The investor gets more or less depending on the crop. The farmer does not loose his land if the crops fail. The same thing goes for an investment in a house. If times are good the investor (owner of the mortgage) gets part of the increase in the value of the house. If the value goes down he may loose part of his investment. In any case: The "owner" of the house does not get kicked out.

    February 13, 2009 at 5:49 am |
  2. Heather,ca

    Oh how I agree with you. I think if word got out to show up you would have crowds and not a cop would stop it. Perhaps some water boarding or I dont know know, be creative. I really dont get why our tax money was given to bailout companies that engaged in high risk financial transactions. They dediced to do it and got bailed out. So maybe their warped twisted logic is ok since we didnt fail we can still run business as usual. Of course Im thinking maybe Paulsen was solely interested in saving his own skin. I really dont think these bankers really care. They have no shame. By bailing them out the bad business decisions were rewarded. So the greed continues. Im waiting for the FBI to start arresting people. That will be the only justice there is. I just wish these clever smart bankers would realize how shameful they really are. What they have done to oue country and the rest of the world.

    February 12, 2009 at 5:54 pm |
  3. Billy Gillum

    Erik said it, Why judge people so quickly, please stop or get a job at FOX! ( which I don't watch)

    February 12, 2009 at 3:43 pm |
  4. raje verma

    These brilliant financial wizards got actually undisclosed billions in bonuses to rip off the average American by short term teasers of 0% to 8% on credit card financing and then fineprinting these offers with additional UPTO 4% financing fee. No doubt they made billions for their respective banks this way: as for average citizen – who bothers if they are ripped off with every hypothetical fee on earth. Any move to control them??

    February 12, 2009 at 1:13 pm |
  5. v.cook

    I believe it is an outrage what the banks have done. I just recently filed bankruptcy because they would not modify my loan. I contacted them in advance before I ever fell behind. I was always on time and never had any late payments except once that I can remember but that was in the very beginning. I contacted them again after filing bankruptcy to remove the car off my credit that Wells Fargo stated was the reason they would not orginally modify the loan. This time when I called they told me that I could not be modified due to the home being in my bankruptcy. I told them if they would modify I would remove it from the bankruptcy. They told me I would either have to give them 75% of what I owed or either fax in documentation of why I fell behind. I did fax in documentation proving that it was due to health /financial reasons. I also submitted supporting documentation. They denied the modification and now my children and I are stuck trying to figure out where to go. I was devastated to hear them say that the money would be used for us and it never happened of me. Now there is a foreclosure and bankruptcy on my credit. I can't even go out to purchase a new home if I wanted too. They told me I didn't qualify for the first time home buyer program and stuck me with a 80/20 loan. They told me that after two years if I modified or refinanced through them there would be no problem and no fees. Here I am two years later without a clue as to why they would not work with me. I hope that someone makes them pay for what they have done. They have gotten rich while taking our money for the first two years, kicking us out , and then selling the homes for profit. Oh and by the way I never was unemployed. I was on disabilty leave and receiving 60% of my pay at the time.

    February 12, 2009 at 1:13 pm |
  6. roger

    The American people all agree to disagree, it’s our way of life. When most of us want to hang someone we need consider to whom started the financial landslide. Let’s go back thirty years when Ronald Reagan said to the GOP and RNC freeze it and they replied deregulate it and the DNC went along for the ride. Today the same political groups are sputtering out the same ideology. Don’t support needs of the working; don’t support educating the poor but, most of all the GOP and RNC must support corporate greed and always inhibit growth of the poor. Go ahead and hang but, don’t stop at the few when the base problem came from the many. Hang them with your pencil at the 2010 ballet box.

    February 12, 2009 at 1:12 pm |
  7. StevG

    The daring disregard or audicity of rhe banks executives spitting in the eye of congress and the american tax payers, is utterly detestable.
    There must be some way congress can curtail there blatant disregard
    for common sense and in your face actions. Now they are calling their bonuses "retention awards". You can put lipstick on a pig, but
    its still a pig. It was exceedingly poor judgement to give the banks
    bail out money ,and trust them to do the right. after all, they were the
    instigaters, and perpetraters of the problems were now are experiencing now.

    February 12, 2009 at 10:14 am |
  8. Suzanne

    Let's REALLY help the citizens of the United States. Each individual over 18 should be allotted let's say $100,000, just for conversations sake. Put that amount on a front loaded card and limit they types of purchases or places where it can be used: car dealerships or other transportation, home improvement stores etc....it should not be used for clothes, jewelry, food, restaurants, liqour etc....you get the idea. Or it can be used to pay off existing debt such as mortgages, school loans, credit cards etc. There is a way to make this work were everybody wins.

    The American people need to be free from their existing debt. They need a clean slate and a refresher course in how to use money wisely.

    Enough already on who's to blame....let's just fix it in a way that is real and meaningful for everyone.

    February 12, 2009 at 8:38 am |
  9. kirk

    In this time of economic trouble our government is still finding ways to was citizens hard earned money. A petition just crossed my desk asking me to sign so that illegal aliens don't get social security benefits. Seriously, we have hundreds of thousands of homeless in this country and its numbers are swelling by the second, and we want to give money to people that do nothing for this country but sap its resources. Wake up people before its too late

    February 12, 2009 at 5:17 am |
  10. Cassandra

    This whole situation is absurd.This has developed because Democrats caved to Republicans when the bank bailout passed in November. Republicans are violently against imposing restrictions on banks that got the bailout money because that would be government interfering with private industry. So we can give them money to stay in business, but it would not be prudent or polite to check up on where our money's going.

    For those of you who are Republican, this is not fiscal conservatism or GOP values of keeping government small; this is unconscionable, unethical, and dumber than a bag of hammers. I wish you would all go take over Iceland. For those of you apolitical, you need to start paying attention to the fools who mandate policies like these. They are going to ruin your lives. For those of you who are Democrats, would you immediately call your congresspeople and demand extremely restrictive and annoying terms be immediately imposed on all uses of bailout funds?

    This economy is so bad that people are sleeping in tents and skipping meals so their kids have food. I'm sick of the government wasting my money on Las Vegas jaunts and fancy retreats and bonuses and bailout out crooks. I want my money to go to help people AT THE NON-EXECUTIVE LEVEL get better lives.

    February 12, 2009 at 4:49 am |
  11. Deborah P

    What is the difference between what Bernard Madoff did and what these CEOs are doing to the American tax payers? In a Ponzi scheme, pyramid scheme, the top people – the crooks- are paid off with the money from the people at the bottom of the pyramid? We taxpayers sure feel as though we are at the bottom of this pyramid. These top executives should be required to return their awards and bonuses and sent to jail. This is what happens when you have businesses "too big to fail". These banks are monopolies and should be broken up into smaller economic entities and the top people should be held accountable for the success or failure of their business. If the business fails, you, the top guy, is also out of business and not retained for a $120 million "award".

    February 12, 2009 at 3:07 am |
  12. Alex

    CEO's of Banks were asked by congress if APRs were raised after accepting bailout monies and only one CEO raised his hand at the congressional hearing. Well, Chase Bank and WaMu (bought out by Chase) raised APRs beginning March 2009 and Chase told me it was because my credit card was not "profitable" to them! I paid my card(s) off early, more than was due and made multiple payments per month. One of my cards' APR was raised from 8.99% to 16.99%! Nice reward for a loyal and credit worthy customer.
    Customer Service said they were in the business of making money not helping me make money.

    February 12, 2009 at 2:18 am |

    I think that when the goverment gives banks money that they would have the common sense to put back into the people. To payout bonuses to retain certain staff. Where are they going to go? Do some of them really think in these times that they will find something better? If the banks are that afraid of there employees then you have to consider that the CEO'S are not running the banks. They should be hung for there action not in a prison out of site put a good public hanging with a display in the stock for 3 days first, and give the money back. Theft is theft and no one is calling it what it is.

    February 12, 2009 at 2:16 am |
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