Robert J. "I Hate Poor People" Samuelson Comes Out Against Corporate Excess

This guy has been infesting the Washington Post for years, and if you know the topic, you generally don't have to read him.

His standard schtick is something like, "Social Security and Medicare? They are bad, they make you stupid. You should be an overpaid pundit like me," so you could have knocked me over with an adolescent tuna when I came across Mr. Samuelson railing against excess salaries and lack of accountability:

Here are estimates for 2007:

Investment banker: $2.1 million, consisting of $275,000 in base pay plus $1.2 million in cash bonus and $625,000 in long-term bonus. (An investment banker helps firms raise capital by selling new stocks and bonds and also advises on mergers and acquisitions.)

Bond trader: $1.5 million, with $240,000 in base pay, $975,000 in cash bonus and $310,000 in long-term bonus.

Hedge fund manager: $1.8 million, split between a salary of $265,000 and $1.5 million bonus.

Just why investment bankers and traders out-earn, say, doctors or computer engineers is a question I've never heard convincingly answered. Are they smarter? Unlikely. Do they contribute more to the economy? Questionable. True, Wall Street often performs a vital function. It channels savings into productive investments. It helps provide access to capital and credit. In 2006, U.S. companies raised nearly $4 trillion through new stocks and bonds. Many financial innovations, including mortgage-backed securities, have benefited individuals and companies.

But Wall Street also frequently misallocates capital and credit. The "tech bubble" of the late 1990s was one episode. Now we have subprime mortgages. Why? Well, the herd mentality of financial crazes has a long history. But compensation practices skewed so heavily toward bonuses based on annual profits make matters worse.

You know, these lessons are not only the same ones that were used to change public policy (Glass-Steagal anyone?) following the Great Depression, but they are actually predicted by free market theory.

If I can make a million or so dollars, and and do not lose this money when the crash comes, why the hell should I care about long term consequences?

One hopes that the current crisis will lead to a re-evaluation of the slavish devotion to the unregulated market as a solver of all problems.