It's hard to go past this remarkable story in The Independent about how British bankers wanted to rein in runaway executive pay but how their plans were quashed by their American counterparts who accused them of being "socialists".
The Independent reports: "Chief executives from the world's banks discussed the plans at a secret dinner held at Claridge's, the London hotel, last October, at which several leading British bankers are said to have suggested that the sector should take greater responsibility for its part in the crash, and do more to reduce the vast bonuses paid to staff. But the recommendations were met by stiff opposition from the US banks JP Morgan, Morgan Stanley and Goldman Sachs, according to one source. "Some of the US bankers were furious about attempts to reduce pay throughout the industry, arguing that any such move smacked of socialism and would be fiercely resisted," the source said on Friday. 'It's not the way the Americans like to go about their business.'."
So the British bankers understood there is a problem with bankers being paid massive bonuses when the rest of the world is struggling with a credit squeeze and unemployment. Quite rightly, they wanted to do something to restore bankers' reputations.
But of course, the Americans saw it as socialism. Mind you, the Americans would know about socialism given the way the US government bailed out the banks and saved shareholders and executives. The Americans know how to socialize debt and losses and privatize wealth. America practices what can only be described as "socialism for the rich", something I blogged about here.
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