The 2009 bonus numbers, which will shortly begin to leak out, are, for the banks, a problem perhaps second only to collapse itself.
The bonus checks, propelled by an epochal leap in the stock market, could be even larger than those from the most fulsome boom years. They may be, in other words, not just an almost impossible-to-explain historical anomaly, but, potentially, the symbol which seals the political fate of these institutions.
Even in a hopelessly jaded world, a world whose perspective was long ago bent by excess wealth, these bonuses are going to be some horrifying and untouchable thing in the middle of the table. They will be so extreme, and out of context, and beyond rational explanation—they will be magical or devilish in nature—that they could well restore a sense of ordinary proportion, and command a sudden moral attention.
The collapse of Lehman Brothers may not be the signpost event of this time. These checks, or the awe and howls of rage and sheer stupefaction with which they are bound to be greeted, could be the Reichstag fire.
That is, if they aren’t handled correctly.
I certainly wouldn’t hand out lump sums, if I were running Goldman or JPMorgan, or whatever. I’d spread it out over five years or some such. Or, I’d encourage something like they’re doing in the UK
, a one-time windfall tax. Bonuses will be taxed 50%—which sounds punitive, but they were already taxed near 40%, so what the hell.
But this isn’t in the nature of a financial industry man. The bonus is the reason for being. The whole point about the bonus is that if you have it, nothing else matters. If it’s there, you take it. You’d be a goddamn fool not to.
So how to explain the incongruity, the preternaturalness, the perversity of it all?
The only way really is, somehow, to make everybody feel like they’re getting something, too. This isn’t easy to do at a moment of 10% unemployment. But perhaps not impossible.
We are about to enter, I suspect, a chapter of great promise, and excitement. The story is going to be good. The world was saved, the future is here, and next year is going to be wonderful.
The rich get richer but, potentially, so does everybody else. Or, rather, if
the richer get richer, so does everybody else.
But it really may not work this time. The reality could be too harsh, the promise just not credible. Wall Street really might be, on the basis of the coming firestorm of outrage and incredulity, broken and reformed. But then again it might work—we want to believe. Most of us would probably rather be happy dupes than grim reformers.
More of Newser founder Michael Wolff's articles and commentary can be found at VanityFair.com, where he writes a regular column. He can be emailed at firstname.lastname@example.org. You can also follow him on Twitter: www.twitter.com/NewserColumns.
If you are the manager of a Wall Street firm, or one of its communications advisers, what you are thinking about right now is this: How do we spin