Tuesday, 17 February 2009

Brown on bonuses

Over at the Times our Dear Leader is empathising with the "millions of hard-working people" about how those nasty bankers that he claims have ruined the economy (No, it couldn't perhaps be anything to do with him, him being the Chancellor under Bliar) are now getting bonuses for their misdeeds. Obviously, our Dear Leader wants to distance himself from the fact that now UK PLC has a significant shareholding in many of the UK's highstreet banks, and so is in effect paying these nasty bankers such sums.

However, his analysis forgets to mention one crucial nugget of information. If it had not been for his Government's insistence that all the banks needed saving by partial nationalisation, then there would not be such a 'moral hazard' of taxpayers paying bonuses. He has created this situation.

Also, if those nasty bankers realised that the taxpayer would not jump straight in when things had gone a bit pear-shaped, then perhaps the remuneration structure would have been slightly different. Bonuses might have been awarded for long term performance, as they would have known that in order to keep the gravy train rolling, the bank paying their bonus still had to be solvent!

Oh well, we can rest assured that "we are taking further steps towards building a successful, competitive and responsible financial sector of the future." Whatever that will mean.

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