In response to the political storm about massive bonuses in bailedout banks, the head of RBS has waived a 1million pound bonus:
http://www.guardian.co.uk/business/2012/jan/29/rbs-stephen-hester-waives-bonus
I'm actually not sure what is more revealing about this
fact - that banks whose share prices have plummetted would award such
bonuses, or that those involved could easily dismiss a bonus of £1m?!
I think it shows how bogus the argument is that 'the rich' would be fly away to other countries if they had to pay even a little more tax, since it's obvious a million here or there doesn't make so much difference to them, that they could reject it overnight, even when legally entitled to it. Though since Hester's yearly package is thought to still amount to about £8m, then taking a 12% cut to avoid being a public hate figure is probably reasonable. But surely the £8m he does get is as much of an issue as the £1m bonus on top of it.
I still remain to be even remotely convinced that anyone can be worth this kind of money, which works out as about £1 per working second. Surely no one can literally make so many decisions, actions to bring in enough
additional benefit. Or to put it in terms of daily wage,about £30,000 a day. I.e. 1.5 times
annual the median wage for a days work. Does such a CEO really make such a difference that it is worth more than 200 of the top 25% of earners (which this salary would be in annual terms).
While even less fair to be called 'earnings', at least the massive income people like Bill Gates etc. receive comes from actual original work and ideas that just generates exponential return over years, but CEOs only 'direct' a company, and I would love to see an analysis of how much tangible difference this makes. Especially since in many areas, e.g. finance, the work of 'experts' is often seen in hindsight to be only as good overall as random chance.
Perhaps also relevant is the comment I heard from a 'city analyst' on the BBC Today programme, claiming that the real danger is 'high flyers' might be discouraged from working for banks in which the state has stake holding, in case their is undue interference in the operation merely as a result of public outcry. Presumably the problem would be that in cases where bonuses were not justified, 'outside interference' might mean they are actually not rewarded. What a blow to our economic system that would be. The irony is that it is mainly in cases where share prices have fallen etc. i.e. where the holy 'market' has delivered a negative judgement on the competency of the CEO that the public outrage will be noticeable. The best thing about being a 'free market capitalist', is being free of the market when it suits you.