Saturday, April 6, 2013

Power and Plenty

The problem with banker’s bonuses is not only that it is highway robbery, but that it encourages a sense of invulnerability, irresponsibility and self-indulgence – as the conduct of bankers clearly shows. The banks were run far more efficiently and responsibly l when executives weren't making that kind of money. 

These guys earn enough in a single year to keep them going for life, so what do they care? They have the freedom to indulge themselves in all sorts of costly ways – costly to their shareholders, their customers and the taxpayer. The whole of history demonstrates a basic weakness of human nature: the combination of power and plenty not only corrupts, it makes people stupid. Exceptions prove the rule. Far from motivating bankers to do their best, the government tempts them to do their worst.