The green-eyed monster is at it again.
First, it was Peter Hain, now it is the Lib Dems’ turn to grumble about City bonuses. Their Treasury Spokesman, Vince Cable, attacks huge City bonuses, claiming that they highlight ‘the gross levels of inequality in human wellbeing up and down Britain’.
Of course they do, but that is no reason to take action against them, especially as they are not the reason for the inequality in the first place.
As to ‘the gross level of inequality’, is Mr Cable unhappy about its existence, or merely about the fact that it is being ‘highlighted’? He comes up with a number of daft proposals; such as denying tax relief to senior executives on their pension contributions, and the possible removal of taper relief on the sale of second homes and stock options.
I’m not really in the mood to discuss the reasons that these proposals are sheer madness; this is, after all, Sunday. I should be halfway through the Sunday Telegraph magazine or some such by now. All I will say for now is: since when is it the Government’s business what a private company pays to its employees? And in case it has escaped Mr Cable’s notice, higher earners currently already pay higher taxes.
Maybe I will return to this topic later, maybe not. It all depends if Mr Cable provokes me again. Back to the Sunday Telegraph magazine.
December 17th, 2006 at 5:07 pm
Reading your post crystalises why I am a Conservative. Labour and Liberal Democrats want to interfere and meddle in things that have nothing to do with government. We want less government; they want more. We want less regulation; they want more. Why can’t they see they don’t have any right to unecessarily interfere with poeples’ lives? This is another area we Conservatives can argue at the local elections in May and at the next general election.
December 17th, 2006 at 5:11 pm
You say these bonuses are not the reason for the levels of gross inequality across the UK. Well no not always but the only reson these companies can afford to pay such huge bonuses is because they are ripping off their lowest paid employees - some of these bonuses are pure greed.
I help run a building company, well I say I help run it but then all the employees do, I earn a brilliant standard of living despite having no qualifications because our company pays all it’s employees from a labourer of his first day to a health and safety manager (me) the same. And I can still afford a house a car, two holidays a year and I could even send my kid to private school if I wanted. And I don’t have to rip anyone off to do it, I could make more if I employed immigrant cleaners at less than the minumum wage, but to be honest I’m just not that greedy.
December 17th, 2006 at 5:20 pm
I must say I have never understood why people get so bent out of shape by what others have that they don’t. And nothing seems to bother people more than when other people get paid 2p more than they do. Maybe if as a society we stopped internally judging people’s worth by how much money they make then we wouldn’t be so upset when others make loads more than we do.
December 17th, 2006 at 6:43 pm
The problem is the ones earning these huge bonuses are also the ones telling pensioners in private schemes that thier benefits have to be cut because the markets have performed so badly.
Anybody else smell the stench from this contradiction.
December 17th, 2006 at 6:58 pm
I’ll put this in broad, general terms, so as not to bore anyone.
The main reason why private schemes have suffered in the last seven years has been because of the abolition of the dividend tax credit by Gordon Brown. As a result, pension funds have not prospered as well as they should have. Many companies have had to switch from a defined benefit pension scheme (ie one which paid out based on the final salary of the employee). They have increasingly switched to a defined contribution scheme (ie one which pays out based on what the contribution by the employee can buy in the markets).
They have had to do this because, with pension funds not doing quite as well, thanks to Gordon Brown’s changes in the rules, it would have been foolhardly for an employer to continue to guarantee a final salary scheme, no matter how well or how badly the pension fund was performing.
So if there is one person to blame for the pensions problem, it is Gordon Brown.
This is not exactly a subject for a Sunday evening, so I’ve tried to keep out the gobbledegook and make general statements. Maybe when I’m in the mood, I’ll do a proper post, complete with facts and figures.
December 17th, 2006 at 7:05 pm
Your take is right, Bel - the green-eyed monster.
December 18th, 2006 at 8:48 am
You say these bonuses are not the reason for the levels of gross inequality across the UK. Well no not always but the only reson these companies can afford to pay such huge bonuses is because they are ripping off their lowest paid employees - some of these bonuses are pure greed.
Crap, Crap, Crap.
Nobody gets rich simply by paying their employees low wages. In fact most of the companies paying these bonuses, pay basic employees more than they can get elsewhere. Logically, how many office clerks, secretaries or cleaners would you have to rip off to afford one bonus to a fund manager? These companies don’t employ that many low paid workers.
They are paying these bonuses so as not to lose top talent. Good luck and Merry Christmas to those receiving such largesse.
December 18th, 2006 at 2:48 pm
This story is all over the web! I thought I was the only one…
Anyway, whether Bob at Goldman Sachs gets £10 million or not I know as sure as eggs are eggs I’m not getting £10 million - or even £10 - so it makes not the slightest bit of difference to me.
So my attitude to whether he gets the cash or not is a reflection of my personality. And I’m a bitter, resentful and twisted individual who cannot be happy whilst there’s someone on the planet with more than me so I hope not only that he doesn’t get the money but that he gets hit by a car on his way home. Rich sod - nobody should be allowed to earn more than me. It’s all so unfair!
/sarcasm off
December 19th, 2006 at 2:11 pm
envy - just in time for Christmas
February 11th, 2007 at 4:31 pm
[...] It’s Sunday, so it can only mean one thing: politicians are attacking City bonuses. They certainly seems to make a habit of it on Sundays (see here and here). [...]