Monday, February 21, 2011

When, according to journalists, does a boy become a man? If a seventeen, eighteen, nineteen year old is a victim of some sort he is classed as a boy. If the boot is on the other foot and he is a perpetrator of some kind he has become a man. A nineteen year old man from Torbay has appeared in a Devon court accused of sex offences against two girls aged fourteen and fifteen. If the nineteen year old in his turn was to bring a case against a sexual predator I am quite sure he would be classed as a boy.
Still on the subject of money; and why not? A section of the world seems to be awash with the stuff while the rest exist at subsistence level or maybe don’t even exist at all. When I mentioned teenage pop stars fortunes in my last letter I was way too conservative. Sixteen year old Justin Bieber, after a singing career lasting all of two years, is reputedly worth £64million! The question I ask is one I have asked before; don’t these people ever pay taxes that they can accumulate their fortunes at such a rate?
According to David Cameron Labour’s economy was built on the worst deficit in the developed world, the riskiest bank lending, the most indebted households, the biggest housing boom and unsustainable levels which brings me to that old gripe – bank bonuses. What is the reason for them (apart from personal greed) and how can the banks afford them or even excuse them when they were in the deepest cesspit of all time such a short while ago and were baled out with billions of taxpayer’s money? It’s the same old excuse. “The chief executive of the Quango set up to monitor taxpayer investments in the state backed banks said bonuses are needed to ensure ‘top talent’ was retained.” Evidently the government is resigned to banks paying out billions of pounds in bonuses despite its call to curb the payments. The best they can hope for is that the banks will pay out less. Fat chance. The Royal Bank of Scotland will evidently pay out nearer £1billion while Barclays will pay £5 to £6billion. At a time when the incomes of most British people are being squeezed by low nominal pay rises and inflation and small business are crashing daily are bankers' bonuses really acceptable? A Labour MP and member of the Treasury Committee has criticised what he described as the government's lack of action over bonuses. Considering the mess Labour got the country into somehow I think this is a case of the pot calling the kettle black – oops, I’ve used that politically incorrect word! The UK government has pumped billions of pounds into the banking sector, and has bailed out both Royal Bank of Scotland and Lloyds Banking Group. As a result, many have argued that it should have a greater say in how much banks pay out in bonuses. However, the banks argue that they cannot dramatically reduce bonuses without the risk of losing top staff to banks based overseas, which are under less pressure to cut the payments. There it is, but as a comment on Google from a Keith Lewis in Hants says, “No bonuses should be paid until the banks have paid back the money put in by government. Losing these ‘top staff’ is a red herring as they put us in the mess in the first place. I doubt other countries will be falling over themselves to recruit them.

1 comment:

Lewis said...

That the "top staff" in the British banks are not nearly competent enough should be clear for all to see. No bonus pay would be the easiest way to get rid of them painlessly and replace them with others, but I bet none would go.
What's so demanding about running a bank these days? Every decision rests on actuarial calculations done in seconds by the computers.
And as for investing: would you let a bank advise you on yours?