But From The Employee's Standpoint....

Let's say your boss negotiates a bonus plan for your division that ensures you considerable wealth - bonuses significantly in excess of your entire annual salary - for each of the next two years. If you're not in the financial industry (where this seems pretty common) you might think, "This is nuts," but are you going to say "no"? You may recognize that your boss is primarily doing this for his own benefit, but what a deal.

Now let's assume your company is cratering, and is bailed out by taxpayers. But you're not responsible for the catastrophe, you're working as hard as - and perhaps harder than - ever, and you kept your side of the deal. You didn't put out your résumé and change jobs to an employer where your pay and bonuses would not be scrutinized. Are you ready to give up your bonus?

Don't get me wrong - I understand why people aren't happy about taxpayer money being used to pay these bonuses. I'm not happy about it, or the de facto perpetuation of a financial industry compensation bubble with taxpayer funds. But there's a difference between saying that and vilifying individual recipients without regard to their relative culpability.

The issue of financial industry overcompensation is hardly a secret. Efforts to reign in compensation to date have been ineffective not as a result of bad design, but as a product of deliberate policy. The politicians who are presently grandstanding are exploiting public anger, but it's more than fair to ask why they are being reactive instead of proactive - why did they happily go along with the status quo until this point? Do they truly believe these bonuses are the biggest outrage to date?

It was a colossal mistake for the Bush Administration to insist that tens... hundreds of billions in taxpayer money had to be distributed with essentially no strings attached, and for the Obama Administration to continue that approach. The compensation issues provide an easily understood metaphor for the problem, but it appears that taxpayers are already unnecessarily out billions of dollars as a direct result of the Paulson/Geithner giveaways.