Stop Whining, Let Goldman Have Bonuses

$23B is galling, but at least the bank is sensible: Sorkin
By Jason Farago,  Newser Staff
Posted Oct 13, 2009 5:45 AM CDT
The home of Goldman Sachs in lower Manhattan.   (AP Photo/Richard Drew, file)
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(Newser) – On Thursday Goldman Sachs is set to announce its third-quarter results, but the talk of Wall Street is the size of this year's bonus pool—predicted to be more than $23 billion. That's the largest figure in the company's history and twice as much as it paid out in 2008, but for New York Times columnist Andrew Ross Sorkin, "we can’t have it both ways": After praying the banks wouldn't fail, now we don't want them to succeed.

Of course it's galling that Goldman is paying out so much, but at least its execs are paid in stock that can only be redeemed over four years—and Goldman may bring in a clawback scheme forcing employees to pay up if their trades go south. What's truly scary, writes Sorkin, is that "other, perhaps lesser firms are probably going to pay even higher bonuses" in an attempt to keep up. Unlike gilt Goldman, they can't do so without taking big risks, "and, well, we're familiar with how that story goes."