Monday, 7 December 2009

Just moving it around

Bonuses are a part of the remuneration package of a lot of people in a lot of jobs; it isn't just bankers that benefit. And in principle, rewarding those who achieve targets can help to improve the effectiveness of organisations. There are, however, legitimate questions to be asked about the size of bonuses, and the basis on which they are paid.

It's a mistake to lump all 'bankers' together as though they were all the same – they are not. But they're not all in line for big bonuses either. The bankers who do the more mundane day to day stuff which we all depend upon to manage our money are performing a useful function - but they're not the ones in line for the big payouts. No, it's the gamblers and speculators; the ones who take all the risks with other people's money - they're the ones lining up to claim their rewards.

What some of the people in the financial services sector seem to be unable to understand is that it isn't the mere fact that they want to pay themselves bonuses which raises hackles; it's a combination of the size of those bonuses and the relationship (or lack of) with their contribution to the success of the organisations for which they work.

There is a great deal of difference between making people wealthy, and creating wealth. There is no doubt that the gamblers and speculators achieve the first; some people (and not just the bankers themselves) have become very wealthy as a result of their activities. But it isn't because they have actually created any wealth; all they've done is to move it around a bit.

Like Robin Hood in reverse, they actually take a little from the many to give a lot to the few. In that sense, their activities have not only been socially useless; they have actually been detrimental to the interests of most of us. The fact that some of them have threatened to take their 'skills' elsewhere unless they are allowed to be paid that to which they think they are entitled shows only how far removed they are from reality. I'm tempted to say 'let them go'; my problem is that I wouldn't wish them on anyone else either.

1 comment:

alanindyfed said...

Excessive bonuses are not the way to create a fair, just and equitable society, and only serves to encourage the mentality of greed, likewise the lottery payouts which run into millions whereby few benefit rather than a distribution to a greater number, and the television "become a millionaire" type programmes which again encourage the vice of greed.
They are the products of a sick society.