Since it is such a slow newsday I felt I could take this space to elaborate on this story and on Bill George.
In all fairness, Mr. George does agree that perhaps both athletes and movie stars are somewhat overpaid - and they are. But at least athletes and movie stars toil and labor for their spoils, often have limited careers and provide a benefit to society. Economically both actors and athletes create income for many people. Just look at the credits at the end of any movie or look at the number of people it takes to support a team in order to bring it to game day. Not to mention the ancillary jobs from sales and production of sports paraphenalia.
In addition both movie stars and athletes provide entertainment - a diversion so greatly needed especially in today's economy where we all need to escape into fantasy for just a few hours so that we can escape from reality.
In contrast, Goldman Sachs employees produce nothing for society, provide no escape from our current reality that they have admittedly created. They do not sweat, toil or expend any physical energy, in fact, their trading is done with the push of a button on a keyboard like the one I am typing on now. (just a minute, I have to take a break to catch my breath for a moment)
Ok, I'm back. I just got a little tired typing all of these words.
Seriously though, even those overpaid athletes and actors don't make the kind of money that is tossed around Wall Street. Wall Street numbers are in the hundreds of billions while athletes and actors are in the hundreds of millions.
Goldman Sachs doesn't cater to the general public in fact doesn't do business with the general public even though they are a commercial bank (another joke). Millions of people worldwide enjoy the work of movie actors and athletes.
Another big difference as well is the fact that only a hand full of athletes and actors make the big money and the majority of them do not. Not so at GS, they have hundreds and hundreds of employees that do except for clerical and low level administrative workers - they are still just workers.
A point I have always made and often written about is that our society - no our government - has things a little backwards. They (the politicians) have enriched themselves and allowed the abuses and excesses of Wall Street so that those folks could enrich themselves beyond the comprehension of even the politicians who helped deregulate or turned a blind eye. These same politicians don't see that higher salaries and incomes should be made possible for teachers, police officers, firefighters and emergency medical service providers.
A highly paid teacher in our public schools would create - using the same philosophy Mr. George and Mr. Blankfein use - a more knowledgeable and capable employee who in turn would teach our children at the highest levels of education anywhere in the world. These teachers in turn would produce other teachers, scientists, doctors and engineers who in turn would put our economy back on track productively for centuries to come.
Instead, the work of these highly paid executives and managers at Goldman Sachs, has caused catastrophic economic hardships on almost every municipality and school system on our country. So much so that teachers, police and firefighters have to be reduced in numbers instead of increased as they are so desperately needed. In addition, the creative investment products (gambling vehicles) along with the fraudulent ratings they solicited have wiped out many of the retirement plans for our service workers and teachers around the country.
Movies and sports don't break a country's economic back as the efforts of these highly paid GS execs have so Mr. George, how do you justify this at all? Perhaps because you are also highly paid as a Board Member of Goldman Sachs higher paid probably there then at your position at Harvard University.
Going to a movie or a sporting event doesn't force us into foreclosure or unemployment. The movie and sports industries don't ask the government for billions and trillions of dollars of the people's money to continue to pay those salaries. We have never bailed out a movie studio or sports team.
To be fair, Mr. George does make some comments at the end of the video that are right. Comments such as Wall Street and big business is recovering but small business is not. He also goes on to say that 70 percent of all jobs are created by small business yet there is no financing available for them. Here again, the government could have provided the bailout funds for small business instead of the "too big to fail". I guess small business is considered "too small to bail". Had TARP funds been provided to small business and to start up business we might very well be on the road to economic recovery but instead ... well, you know where we are.
On last note on Mr. George's comments. He indicated that firms like CountryWide and New Centruy Mortgage went too far overboard in their business practices but were it not for Goldman Sachs - their derivatives and credit default swaps - the market for mortgage paper would have been greatly reduced and companies like the two mentioned above could not have created the excesses. Also note that Bank of America, Wells Fargo, JPMorgan/Chase and Citi also would have been severely limited in the number of mortgages they created were it not for the excess, fraud and manipulation of Wall Street led by GS. The same holds true for Fannie Mae and Freddie Mac.
Goldman Sachs and their high paid employees, Mr. George, are not in the least bit comparable to those highly overpaid actors and athletes. I, at least, enjoy watching them on the field or on the big screen. The GS execs hide out in their taxpayer supported new ivory tower and are never seen by the public.
Here is the link to the HuffPost article.
Image via WikipediaBill George, Goldman Sachs Board Member, Compares Bankers To Pro Athletes ...
Huffington Post (blog)