2011-10-21 / Columnists

Left, Right And Middle

Commentary By Glenn DiResto

As Occupy Wall Street heads into its fifth week, there are many wondering what this movement is all about. After watching reports on both liberal and conservative news channels, I went to Zuccotti Park to see what the demonstration was all about. There were people there of different ages, races, ethnicities, religions and economic statuses. After listening and discussing some of the issues with a few of the demonstrators, I was able to see that people are very angry at the inequities and failures of our economy. They believe that our nation’s economic collapse and recession were caused by Wall Street executives who continue to get huge financial bonuses while the average American is living paycheck to paycheck. You be the judge!!!

During the economic collapse of 2008 many of the largest investment companies went belly up. Lehman Brothers filed for bankruptcy, the largest in US history. Meanwhile the CEO received over $500 million in pay and bonuses since 2000 and a $22 million bonus just a few months before the company collapsed. Is there not something wrong with this? Washington Mutual also went under and ended up being sold to JP Morgan Chase. Bear Stearns was about to collapse when they ended up being bought out by JP Morgan Chase as well. Merrill Lynch lost billions and was purchased by Bank of America. However, they still managed to pay out $3.6 billion in bonuses to top executives in charge of overseeing the company. AIG took almost $200 Billion in bail out money and a short time later announced that they were planning on paying $165 million to top executives as a bonus. Are you starting to get the picture of why people are angry? Top Wall Street executives continued to make unimaginable personal financial gains even after they helped create the largest financial bubble of our time.

Due to the collapse of the financial institutions, our government created a $700 Billion Troubled Asset Relief Program (TARP). They told us these companies were too big to fail. So what did our government allow to happen? Five of the largest financial companies have now become the two largest financial companies. Too big to fail just became a little bigger. Some companies that received TARP money paid their loans back sooner than expected, due to the executive compensation limitations that were put in place. There is no doubt the complexity of our banking system and financial markets need the brightest individuals to head these investment banks. Senior executives of these companies should receive fair and just compensation for the job they do. However, is the $22 million bonus that was received by the CEO of Lehman Brothers just a few months before they went under fair and just compensation? That is only one example of the egregious bonuses that some of these top executives received.

Even though three years have passed since the collapse of our financial markets, public resentment and animosity still lingers. Top executives on Wall Street who received huge bonuses have become the poster child of the Occupy Wall Street movement. These executives carelessly managed and overleveraged their company’s finances making them insolvent and in need of a taxpayer bailout. The leaders of these companies are partially to blame for the financial collapse that has cost tens of millions of Americans their homes, life savings and way of life. There are many Americans out there who are really hurting. They are struggling to put food on the table, and living paycheck to paycheck if they can get a job. At the same time Wall Street compensation committees are trying to figure out how big the bonuses they are going to dole out this year will be.

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