CNN Money has reported that Stanley O'Neal, who left Merrill Lynch as CEO today has left with a package of up to $160 million.
The company reported a loss of $8 billion last week on sub-prime mortgages.
O'Neal has made 2% of that to walk away.
I'm not sure what I find more offensive:
1. Lending to people who you know cannot repay;
2. Paying people small fortunes to decide to buy that debt;
3. Losing pensioner's money, because that was, at the end of the day, used to finance these deals - after all - most stock holding is now in mutual funds of some sort or other;
4. Paying $160 million to reward incompetence.
If you tell me you think this economy is sustainable I won't believe you. It isn't. Justice requires that it isn't. And justice tends to have its way, in the end.
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[…] What’s the rate of return on losing $8 billion? […]
I’m not sure what you can do about this in this generation, but what about the next? One must have hope for the future.
Surely we should introduce a negative and progressive lifetime Capital Receipts Tax?
Why should the heirs of crooks, geniuses. grafters, trustafarians and over-compensated incompetents start off with hundreds of millions, before they lift a finger, while others start off with absolutely nothing?
Let everyone start off with a national Universal Inheritance of 10% (£9,000 in UK) of average national wealth (£90,000 in UK) at 25, means-tested, subject to and financed by such a progressive Lifetime Capital Receipts Tax, starting at 10 %.
Let donors pay a flat 10% for witholding and record purposes (yes, a double tax on after-tax income, like, but less than, VAT). Have no inter-generational exemptions but intra-generational exemptions beween partners, spouses and cohabiting siblings. Make the flat tax paid by donors deductible from the progressive Capital Receipts Tax due from recipients.
It is time to look again at “An Accessions Tax” by CT Sandford, JRM Willis, DJ Ironside – Institute for Fiscal Studies PUblication No 7 September 1973.
Their mistake was to see this as a replacement for the tax on giving and bequeathing. The two taxes should operate in a broadly self-financing tandem, with transferable tax credits between the two.
Who is looking at this, apart from the Liberal Party, whose policy this British Universal Inheritance is? (See http://www.liberal.org.uk – not the EU-fanatic Lib Dems – and http://www.universal-inheritance.org)
It is time to break the widespread political, professional and social taboo on the redistribution of wealth, as opposed to income.