A Bloomberg News poll found that 71 percent of Americans (and 76 percent of Republicans) favor banning annual bonuses on Wall Street. Another 17 percent favor a 50 percent tax on bonuses above $400,000, and only 7 percent say the compensation system is fine as is. To put that last point in perspective, says Reuters' Felix Salmon, 24 percent of Americans think Obama is a secret Muslim while 41 percent believe in ESP: "Americans will believe anything, it seems—except the idea that incentivizing bankers at systemically-important institutions to take big risks makes any sense at all." As Wall Street prepares to dole out another year of huge bonuses, based on bailout-fueled profits, should Washington take note and step in?
Banning bonuses is a political no-brainer: Even if the Bloomberg poll's "stunning numbers" are off by 20 percentage points, "I'm pretty sure it shows there's political gold" in quashing the Wall Street bonus, says Ryan Chittum in the Columbia Journalism Review. But it will take much more than poll numbers, even staggering ones like these, to loosen the Wall Street "grip on Washington."
"Bloomberg poll: Stick it to Wall Street"
But it may not be fair: Is the anger over bonuses really about justice, or "resentment"? asks Joshua Brown in The Reformed Broker. Most Wall Street banks have paid back the bailout funds, so taxing them extra or imposing new rules about compensation is murky territory. It straddles the line between promoting "fairness in society and the desire to punish people for success."
"Today in slightly misguided populism"
The market will lower bonuses on its own: The bonus ban "isn't likely to happen," says David Indiviglio in The Atlantic. But the "incredible" number of "angry Americans might be happy to hear" that thanks to new rules from the Wall Street reform bill, and the end of a two-year recovery in financial markets, bonuses will be less "astronomical" going forward without "specific legislation to curb" them.
"Two-year Wall Street revenue soars, but will it continue?"
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- 7 grammar rules you really should pay attention to
- Your literary playlist: A guide to the music of Haruki Murakami
- Why you should stop believing in evolution
- The secret to handling pressure like astronauts, Navy SEALs, and samurai
- After Ferguson, we don't need another dialogue on race
- The government is getting into the fact-checking business. Be very, very afraid.
- 11 scientific studies that will restore your faith in humanity
- In defense of Obama's golfing
- A trick for better lunch sandwiches
Subscribe to the Week