The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA. Thank you very much. – Gordon Gekko in Wall Street
In the movie Wall Street, Michael Douglas plays an unscrupulous, slimy corporate raider named Gordon Gekko; a cut-throat, ruthless character whose win-at-all-costs mindset allows him to sacrifice his ethics as long as it means he gets to add to his already-significant financial empire. Douglas’s masterful portrayal of Gekko won him an Oscar for Best Actor. It was the movie’s only nomination.
Yes, it’s safe to say I loved Wall Street. On the other hand, the same can’t be said for Wall Street.
That’s because I believe Wall Street is playing those of us who live and work on Main Street for fools — and we better wake up soon because it appears to me that, based upon the latest antics that the Wall Street crowd have bestowed upon us, the fabric of our society is beginning to unravel at an alarming pace.
To wit, the latest news regarding AIG’s decision to further enrich their employees with $165 million in bonuses is the latest assault on my financial senses. It is an assault that has further eroded my once unshakable confidence in our financial system and those that control it.
It’s bad enough that the privileged on Wall Street have convinced those in Washington that Main Street should be responsible for coming up with $170 billion in bailout money to keep AIG afloat. But using taxpayer funds to give retention bonuses to employees at AIG’s Financial Products division goes beyond the pale.
Specifically, it is the employees of AIG’s Financial Products division who were the central players in last year’s financial meltdown. These are the very same individuals that created the voodoo financial models that led to some of the most dubious market deals imaginable using those mysterious “credit default swaps” and intricate insurance products that eventually toppled the company.
In Wall Street, Gordon Gekko could have been talking about these very guys when he said, “If these guys owned a funeral parlor nobody would die!”
AIG Chief Executive Edward M. Liddy defended the bonuses by saying that they were contractually obligated to honor them. But that only begs the question: Considering that these bozos ran AIG into the ground, how in the world did these employees ever manage to qualify for any bonus in the first place?
Clearly, these employees were of zero value to their company. How many ethical companies give bonuses to individuals that are of no value to the bottom line?
I don’t even think our resident advocate of the mandatory 20% tip, Courtney-the-Waitress, would be okay with whatever hair-brained criteria AIG could have come up with to justify these outrageous bonuses.
Unfortunately, the actions of AIG are another finger in the eye of the American taxpayer. The bonuses foment distrust in those who continue to insist that we can’t let companies such as AIG fail, lest we will experience financial Armageddon. They also force us to question our government’s ability to do the right thing.
But the ultimate tragedy is that AIG’s reckless decision erodes confidence in the free market and weakens the bedrock of trust that a capitalist society requires to properly function.
It is time to stop throwing good money after bad. AIG has lost the confidence of Main Street and as such it must be allowed to fail. Let the chips fall where they may.
I still believe that Capitalism offers the best opportunity for people to achieve personal success. Ironically, Wall Street has recently become smitten with the “safety” of Socialism and averse to the benefits of creative destruction.
The folks on Wall Street have inexplicably become soft. On Wall Street, greed has been replaced by fear — and that needs to change. Hopefully Gordon Gekko can knock some sense back into them.
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[…] Gordon Gecko Would Be Proud: It’s Time to Let AIG Fail – I’ve always said that capitalism’s creative destruction process is necessary for ensuring a healthy vibrant economy. It’s certainly not taxpayer-funded bailouts, which only make things worse over the long run. […]