Wall St. Bonuses Come at a Bad Time

Do you want to see a good example of the haves and the have-nots? Let’s look at the have-nots first. They are the millions of people who have lost their jobs in the last couple of years since the housing market crashed and led the nation – and the globe – into the worst recession since the Great Depression.

They are the ones whose homes have been lost; whose retirement nest eggs have been scrambled; whose kids weren’t able to go to college because their savings were drained.

And the haves?

They’re the men and women who work on Wall Street whose bonuses jumped 25 percent last year to an average of almost $124,000.

A report out this week by the New York State Comptroller indicated that Wall Street firms paid out an estimated $20.3 billion in cash bonues in 2009. That’s 17 percent higher that 2008, when bonuses were slashed during the financial meltdown.

We’re only talking about the cash bonuses. The actual figure is much higher when you throw in the stocks and other deferred compensation the workers get.

Many of these are the same firms who were bailed out by the taxpayers last year to the tune of billions of dollars.

“It is a very awkward situation,” Alan Johnson, managing director at compensation consultant Johnson Associates, told USA Today. “The financial industry has recovered quickly, but the rest of America is still hurting.”

The bonuses given to Wall Street workers while millions of Americans continue to suffer reflects a growing class divide.

“It’s exposing a deep rift in American society,” Chuck Collins, a senior scholar at the Institute for Policy Studies, told the Associated Press. “This isn’t the rising tide lifting all boats. This is the rising tide lifting a few yachts, while other people’s boats sink further underwater.”

The bonuses stem from the success the Wall Street firms enjoyed in 2009.

It’s unfortunate that Wall Street’s success hasn’t trickled down to Main Street.

Chuck Collins is a senior scholar at the Institute for Policy Studies where he directs the Program on Inequality and the Common Good (www.ips-dc.org/inequality). He is co-author, with Mary Wright, of The Moral Measure of the Economy.