Indispensable Losers

by digby

The other night Eliot Spitzer was interviewed by Howard Dean (who was filling in for Maddow.) They had an exchange about the subject that makes me want to hurl heavy objects through the TV every time I hear some self-interested Wall Street jackass or fatuous gasbag babble on about how we can’t afford to piss off all the people who brought the finacial system to the brink because then they might quit. Like that would be a bad thing. A fair number of them would be getting off lucky just to lose their jobs because they belong in jail.

Spitzer said:

There’s an old saying, I think it was De Gaulle. ‘The graveyards are filled with indispensable men.’ The AIG folks who are saying they’re indispensable – test them. I think it’s time to call their bluff. Say to them, ‘you want to leave? Go away. We will replace you at one third of the pay.’ The entire structure of Wall Street pay is out of control.

The idea that in a country of 300 million people the only ones who are qualified to run these big failed and nearly failed banks and insurance companies are the same people who screwed them up is a sad comment on the state of American capitalism. These people are overpaid, overfed, pampered, egomaniacal Divas, not superheroes, and if they are the best we can do then we have much bigger problems.

This HuffPo piece reports on the fetid facts that prove the point:

A new study from Harvard, “Wages of Failure,” will only serve to stoke public anger at Wall Street compensation as it concludes that “since 2000, the top five executives at each firm (Bear Stearns and Lehman Brothers) had received staggering amounts of cash bonuses and had sold mountains of stock.” While the CEOs of these companies lost hundreds of millions in stock when the firm went belly up (Lehman Brothers) or was bailed out (Bear Stearns), they still retained massive compensation packages.

As one financial compensation expert put it: “They were rewarded hundreds of millions of dollars, and they got that reward for making catastrophic decisions.”

I’m pretty sure they believe they deserve it just for being so special.

Update: In this post about the Federal Reserve’s intention to squeeze credit because they once again fear inflation (I guess that 10% unemployment just isn’t getting the job done?)the author notes that the people in charge are clueless.

That is not disqualifying, as we know. He quotes this from Yves Smith:

These statement is an indication of intellectual bankruptcy at the Fed, that they have learned nothing from the crisis. But that isn’t surprising. CEOs usually need to be fired after they have presided over a disaster. They are incapable of seeing and remedying their errors. Why should senior bureaucrats be any different?

Actually CEOs are told they are indispensable and are then given big bonuses after they have presided over a big disaster so these senior bureaucrats are holding themselves to exactly the same standards to which they hold all other elites of their caliber. It’s the American way.

.