This just in—the bonuses for those barons of Wall Street known as “fixed-income professionals” may be 5 to 20 percent lower this year. Of course, this is mostly attributed to the subprime mortage collapse, or, if you prefer, the bursting of the so-called housing bubble.
By the way, the word “bubble” is just a nice way of saying pyramid scheme, which is a con job fueled by greed that has been going on in different guises since the Dutch tulip craze of the 17th century. Somebody always gets left holding the bag—and it’s never the fraudsters and snake-oil salesman, er, I mean, “brokers.”
Do you weep for those guys on Wall Street? Instead of getting, say, five million bucks at Christmas, the average master of the universe might get three million. Think of the recently ousted CEO at Merrill Lynch, E. Stanley O’Neal. It was on his watch that Merrill dropped $8.4 billion in the credit crisis. They call it a “write-down,” another B.S. euphemism. Write down? Try melt down. Eight billion big ones is the gross national product of some countries, but what happens to O’Neal? He walks out the door with enough money to satisfy most baseball free agents, except, of course, the extra-terrestrial king of avarice, A-Rod.
Ah baseball. I’m glad I brought baseball up. Because there’s a connection here. Have you ever noticed how many times these high-finance guys compare themselves to super-star baseball players. Usually, if they’re in New York, they evoke the name of Derek Jeter. He’s the gold standard.
Last summer, in an excellent story on the new “Gilded Age,” The New York Times quoted Leo Hindery, Jr. a millionaire private-equity fund manager, who justified his wealth by citing the Jeter Principle.
“Jeter makes an unbelievable amount of money,” Hindery told The Times. “But you look at him and you say, ‘Wow, I cannot find another ballplayer with that same set of skills.”
This friends, is Exhibit A in the new world of inflated self-worth, hubris and grandiosity. It gives rise to populist thinking and class warfare, which most Americans ordinarily have trouble embracing—and for good reasons. Most people believe in a fair system which gives everyone an equal chance to get rich, and so they feel uneasy attacking the wealthy as undeserving. It’s still a great country, despite everything.
But you get the feeling that the gap between the hyper rich and the rest of us has gotten too wide—and that there’s too many golden parachutes being handed out to those who blow other people’s hard-earned money and never suffer any real consequences, Enron convictions notwithstanding.
In any case, Hindery ought to try and hit a fastball.
Which leads me to Curt Schilling, the big-mouth pitcher for the Boston Red Sox. Schilling who is 40 years old and on the downhill side of his career, just signed a one-year deal for $8 million. His contract is also larded with lucrative bonus incentives worth up to an additional $6 million. But get this—if he keeps his weight down during the 2008 season he stands to make an extra $2 million.
In other words, he gets a Lotto-sized prize for not stuffing his fat face. I give you the modern professional athlete.
But the best part of the Schilling travesty is the statement given by Theo Epstein, the Red Sox general manager after he signed his star. See, Epstein was pleased that he got Schilling so cheap! That’s right…cheap.
This is what Epstein was quoted as saying:
“A lot of times players say it’s not about the money and it ends up being about the money.
“It wasn’t about the money. That’s something to be commended in this day and age.”
What a guy that Schilling is. A true role model. He could work on Wall Street, but they don’t have fat incentives. Not this year, anyway.
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Phil Reisman is a veteran journalist and native of Westchester County. He began his career in 1977 as the head copy boy of a startup New York City newspaper that quickly went belly up. Reisman was not to blame for the newspaper's failure, or so he claims.
