The House and Senate are moving today to pass legislation that would “impose a hefty tax on retention bonuses paid to executives of companies that received federal bailout money.” Of course, this compelled CNBC to come running to Wall Street’s defense.
During a discussion with Financial Services Roundtable CEO Steve Bartlett, CNBC anchor Mark Haines came at the executive compensation issue from a foreign policy perspective. He argued that the examples set by Nazi Germany and the Iraq War make it clear that Wall Street employees should have their bonuses:
It’s just like when the Allies were victorious over Nazi Germany in World War II, when we occupied the country, we left a lot of Nazis in place because they were the ones who made the trains run on time and the bureaucracy function properly, etc. And it was distasteful, but you needed them. And in fact, our experience in Iraq kind of demonstrates the wisdom of that, because in Iraq we replaced the Baathist bureaucrats and the result was chaos. Not to compare Wall Street to Iraq or Nazi Germany, but the point is you need people who know what they’re doing.
Haines said that his point was “not to compare” Wall Street to Iraq or Nazi Germany, but it sure seems like that’s what he did. Bartlett wanted no part of it, saying “I’m not even going to touch your analogy.”
Crazy framing aside, Haines was trying to make the same argument that the New York Times’ Andrew Sorkin made this week: “A.I.G. built this bomb, and it may be the only outfit that really knows how to defuse it.” Rep. Barney Frank (D-MA) called this idea “nonsensical” in an interview with ThinkProgress:
If they really understood what they did in the first place, seriously, they probably wouldn’t have done much of it. Secondly, when you are trying to undo something, it is often not the case that the people who did it are the ones to put in place.
Haines also missed an opportunity to ask Bartlett about the Financial Services Rountable’s ongoing lobbying effort to blunt the bonus legislation. According to Roll Call, the Financial Services Roundtable is one of the entities that has “moved into hyperdrive, engaging in a behind-the-scenes counterattack after lawmakers trained their eyes on all bonuses paid out by struggling banks.”