Sorry, but we rely on our Wall Street bonuses.
These firms are already struggling, and do you want to see your top performers walk out the door to another firm? So, you know, we don’t know how this is gonna go over with the public, but right now, that’s how Wall Street is defending itself.- Melissa Lee, Today Show
Living in a bedroom community outside of New York City, I know many people who work on Wall Street. Most of them have jobs that are so esoteric it’s difficult enough to explain what they do let alone why they get such huge bonuses, but a simpler way to explain this abuse is to tell the story of a girl friend of mine.
She’s in a different field now, but 8 years ago she was a secretary at one of the larger brokerage firms on Wall Street. As a secretary, her salary was $75,000, and her expected bonus every year was around $150,000.
A secretary making $225,000 a year for doing nothing more than any regular secretary would be doing - and she agreed, it was insane.
There are those, like the woman quoted above, who defend the bonus structure on Wall Street, and many who have suggested that these people count on their bonuses. First off, lets put aside the argument about keeping your best people by spreading the wealth. My first question is why do these people rely on these bonuses? Answers I’ve received have been along the lines that it’s an “extension” of salary and many of the brokers and fund managers consider that part of their yearly income. Without that money, it would be like eliminating 2/3 of their salary and putting their expenses in jeopardy.
My second question would be this: If these people cannot manage their own lifestyles with their base salary - many times between $150,000 and $180,000 - how well can I expect they will handle my money? Well, obviously they cannot, thus the situation we find ourselves in with the financial meltdown.
