Thursday, 16 October 2008

The Shock Doctrine

Reading a book like Naomi Klein's The Shock Doctrine, at a point like this in economic history is enough to make anyone want to run back to the safe pages of fictional books.

Several weeks ago, when PJ and I had finished watching the final episodes of Underbelly, it was exciting to read in the paper about all the unsavoury underworld characters we had come to know and even like.

Not so with Klein's chronicle of greed. To read her descriptions of so many militant capitalists, such as the Chicago School's Milton Friedman, and what they were prepared to do to get their economic policies into place in other countries as well as in the US, is frightening to say the least. But to open up the paper and read the extent to which the world economy has been affected because of such greed is simply horrifying.

Lloyd Blankfein, chief executive officer of Goldman Sachs took home $74 million in salary, bonuses and other awards last year. Richard Fuld, chief executive of the now bankrupt Lehman Brothers received $71.9 million.

Over the past five years, Fuld made $354 million leading his company on a wild ride that ultimately ended in bankruptcy. He was Lehman's biggest individual shareholder.
Let's hope Rudd's crackdown on "extreme capitalism" and bank executive salaries is received as the blow we wish we could deliver ourselves, personally. 

In the US, it looks like someone beat us to it:


Commander said...

Hey Meg, love your blog !
here's some more disgusting statistics:

...but we all know Love will conquer all...



U.S. Treasury Secretary Paulson's Pay:

``We're asking the American taxpayers to sacrifice and put $700 billion out there when other people have been lining their pockets,'' Illinois RepresentativeLuis Gutierrez, a Democrat, said today. ``I want to make sure it doesn't happen tomorrow.''

As Goldman's chief, Paulson himself received an $18.7 million cash bonus for the first half of 2006, and in 2005 he was the highest paid chief executive officer on Wall Street, reaping $38.3 million in salary, stock and options.

He had also accumulated 3.23 million shares of Goldman's common stock worth $492 million, plus restricted shares worth $75.2 million and options to purchase 680,474 shares, according to a Goldman regulatory filing on July 2, 2006.

Paulson wasn't required to pay a 20 percent tax penalty on some of his compensation from Goldman under an Internal Revenue Service rule that waived the tax on executives forced to sell stock to comply with government ethics rules.

Commander said...

that last comment reads strangely. sorry.