Bailout

Blankfein?s seven-figure bonus

By Felix Salmon

I was expecting Lloyd Blankfein’s bonus to be small this year, but I wasn’t expecting it to be as small as $9 million: a mere 7 figures.

This is a great move by Goldman, not just from an external public-relations perspective, but also from an internal point of view: the small bonus for Blankfein makes it really hard for anybody else in the company to complain that they’re being underpaid.

Goldman is also lucky that the Couric Rule, under which public companies would need to disclose how much their highest-earning employees are making, is still not in force, although it does seem to be on its way. If Goldman were forced to say how many of its employees are making substantially more money than the CEO, and how much the top earners are bringing down, this latest piece of high-profile underpayment would probably feel less impressive.

Of course, $9 million is still an enormous amount of money for any one person to earn in one year, and Blankfein made many times that sum as his holdings of Goldman Sachs stock appreciated over the course of 2009. He’s still comfortably in the realm of the plutocrats. But in a way that’s the point: you don’t need to be paid $50 million-plus to be a master of the universe. Blankfein is one of the kings of Wall Street no matter how much or how little he’s paid. And maybe, just maybe, Goldman Sachs is coming to the realization that its senior executives won’t leave after all if their bonuses are cut to the merely enormous from the utterly obscene.

Full post as published by Macroprudential on February 05, 2010 (boomark / email).