CT Blue

One disadvantage of being a part time blogger, usually forced to bloviate at night, is that by the time you're free to write, the low hanging fruit has been picked clean. So I was sure this morning that by the time I got a chance to take a whack at Andrew Ross Sorkin's column in the Times this morning, I'd be the last of hundreds. Yet, among the many blogs to which I subscribe, only the ever reliable Dean Baker, at least if the search function on my RSS reader may be trusted, has gone after Sorkin.

Sorkin, it seems, can't quite see the problem with a relatively newly minted Wall Street custom. He thinks it's only fair that when a guy gets chosen to regulate his Wall Street peers, he (or the rare she) should get an unearned going away present from his former employer. Something modest, say $20,000,000.00, as Sorkin himself reported about Antonio Weiss a few weeks ago.

According to Sorkin, the country needs people who know how Wall Street works to regulate Wall Street, and we're not going to get them unless we allow them to walk away from their former firms with unearned millions. You see, the folks on Wall Street are different than you and me. What looks to us like payment for services to be rendered looks to them like a service to the public. After all, can we really expect someone with a Wall Street background to work for less than $200,000.00 a year? Why, that's a rounding error in their bank statements. If they don't get a fat check on the way out the door, with an implied promise that they'll get an even fatter one if they return from a job well done, then simply no one from Wall Street will want to regulate Wall Street, and, as Baker points out, we might get stuck with “academics, union officials, and people with business backgrounds other than finance” regulating our markets, with potentially disastrous results, which, I suppose Sorkin would have it, we've managed to avoid as a result of the quaint custom he defends. Remember, this is America. Our memories are supposed to go back no further than one week.

But, in a way, Sorkin is right. These payments can't do much harm, because even if they weren't made, these folks know they will be amply paid if they do the right thing when they leave “public service” and return to the fond embrace of their organized crime family former employer. It hardly matters if they get prepaid.