Goldman Sachs 2009 bonuses to double 2008’s; $23 billion could send 460,000 to Harvard, buy insurance for 1.7 million families

By John Byrne
Tuesday, October 13th, 2009 -- 8:07 am
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2008 05 27 1MillionDollars Goldman Sachs 2009 bonuses to double 2008s; $23 billion could send 460,000 to Harvard, buy insurance for 1.7 million familiesYesterday, we brought you the insurance company that wouldn't insure a 17-pound infant because he was too heavy. Today, we bring you the investment bank that manages to double its bonuses during the worst recession since the Great Depression.

On Thursday, Goldman Sachs will announce the firm's bonus payments for 2009. Analysts expect the bonus pool to mushroom to $23 billion -- double the bonus pool paid to employees in 2008. Earlier this year, Goldman Sachs said that it had put aside $11.4 billion for bonuses during the first half of the year.

“The absolute size of compensation payouts will rise significantly,” Keith Horowitz, an analyst at Citigroup, wrote in a note to clients two weeks ago, highlighted by Andrew Sorkin in The New York Times' dealbook column Tuesday.

How much is $23,000,000,000?

For one thing, it's enough to send 460,000 full paying students to Harvard University for one year, or 115,000 for four years.

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It's enough to pay the health insurance premium for the average American family ($13,375) 1.7 million times.

It's enough to upgrade 191 million computers to Windows 7 operating system (priced at $119.99), or to buy 115 million iPhones at $199.99 (provided the recipient was willing to sign a two-year contract).

Or, apparently, it's enough to reward the employees of Goldman Sachs for a bonanza trading year, at a firm where average employee compensation was recently $622,000 -- and likely to be greater this year.

The $23 billion figure could leave some American taxpayers woozy -- the US government bailed out Goldman Sachs with a multi-billion payment last year, which the firm has since repaid.

But while Goldman is likely to pay its biggest bonuses ever to employees, the firm pays very little in taxes worldwide. In 2008, the company was said to have paid just $14 million in taxes worldwide, and paid $6 billion in 2007.

The firm's corporate tax rate? About 1 percent. According a prominent tax lawyer, “They have taken steps to ensure that a lot of their income is earned in lower-tax jurisdictions.”

Sorkin says Goldman's CEO is trying to hold off criticism by making a big charitable donation.

"Now there’s talk inside Goldman that it is considering making a huge charitable donation — perhaps more than $1 billion — as a way to help deflect the criticism," Sorkin says. "Such a donation would be a welcome gesture that would no doubt benefit many needy organizations. But it would most likely be seen for what it is: a one-time move to draw attention away from where most of the money is really going. A large charitable donation also raises questions about the company’s fiduciary duty to its shareholders; it could be seen as giving away profits that ostensibly belong to them."

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Story comments are below...
  • allfactssupportmypositions
    If you wonder why YOU are broke, it is because these leeches are sucking all the cash out of our economy, and there is nothing left for you. BANKS CREATE NOTHING. They are necessary, but shouldn't be the ones making most of the money....

    wellwellwell is right. I didn't expect Obama to be able to do much about the "ruling class" and he hasn't. Face it folks. America serves "them" and not the other 99% of us.

    Tax assets not wages.

    The Answer To Most Of America's Problems.

    Tax wealth not work. (Ralph Nader)
  • theghostpony
    Two reasons to enact a Corporate Death Penalty...

    Goldman

    Sachs
  • alfredo
    Capitalism, capitalism, capitalism. I% owns 95% of all assets and the bottom 99% owns 5%. What a love story!
  • Guest
    If the 9/11 highjackers had flown their planes into AIG & Goldman Sachs, they'd be heroes now.
  • jimbo701
    I really don't know what to make of this. It seems impossible that almost every business in the country is cutting jobs and benefits yet Goldman Sachs is paying out insane bonuses to very highly paid employees. Given that their survival is due to the US taxpayer one would think they'd show a little humility about their good fortune. Something is very wrong here, ESPECIALLY given the fact they only paid 14 million in taxes last year. Pigs at the trough.
  • damixaustex
    Stocks and financial system blew out, Government came to the rescue. Stocks rise, they take bonus?? What about putting some of that money in reserve for the next blowout?

    They're pulling the money out before Congress has time to regulate them. It's on the horizon and they know it.
  • maninwarren
    It's on the horizon? Why, because Congress answers to the voters and not their corporate sponsers? Dream on.
  • saltydawg77
    Didn't you get the memo? The U.S. government is a subsidiary of G/S.
  • rollandmiller
    The Bonuses are a slap in the face of the US Government and the American people.

    How dare they!

    This must be the largest Casino in the World playing with investors money.
  • wellwellwell
    Isn't it nice how Obama is not going after these people..protecting them..Change, change you can count on:)
  • lazardlover
    isn't it terrible that that bank is making a profit and you couldn't be bothered to go to a decent college and get a job with them? waa waa waa boo fucking hoo get a job

    boo hoo GS are paying a big bonus to staff, staff obv. don't pay taxes because of a special rule no-one's ever heard of but I'm going to imagine exists, waa waa waa
  • Joy4
    It makes me angry that the hogs are rolling in money, while so many are just struggling to survive. Many jobless people would peel grapes all day for a job, if they could get it.
  • No thanks
    Welcome to the Goldman States of America
  • texanarch
    At the least, there should be protesters in front of all the Goldman Sachs offices across the country. These bastards should be confronted by the citizens. They should not be able to walk out of their offices, ever, without seeing someone in their face. This company has been gaming the system for almost a hundred years. They are the problem. They are thieves. They are uncaring greedy bastards. I know that the Goldman Sachs offices her in Dallas are in the Crescent Building off of McKinney Ave.

    In fact.....
    Atlanta

    Goldman, Sachs & Co.
    3414 Peachtree Road, NE
    Suite 600
    Atlanta, GA 30326
    USA
    Tel: +1 404 846 7200

    Boston

    Goldman, Sachs & Co.
    125 High Street
    17th Floor
    Boston, MA 02110
    USA
    Tel: +1 617 204 2000

    Chicago

    Goldman, Sachs & Co.
    71 South Wacker Drive
    Suite 500
    Chicago, IL 60606
    USA
    Tel: +1 312 655 4600

    440 South LaSalle Street
    Suite 1600
    Chicago, IL 60605

    Dallas

    Goldman, Sachs & Co.
    100 Crescent Court
    Suite 1000
    Dallas, TX 75201
    USA
    Tel: + 1 214 855 1000

    Houston

    Goldman, Sachs & Co.
    1000 Louisiana Street
    Suite 550
    Houston, TX 77002
    USA
    Tel: +1 713 654 8400

    Jersey City

    Goldman, Sachs & Co.
    30 Hudson Street
    Jersey City, NJ 07302
    USA
    Tel: +1 212 902 1000

    Directions to 30 Hudson [PDF]



    Los Angeles

    Goldman, Sachs & Co.
    Fox Plaza
    Suite 2600
    2121 Avenue of the Stars
    Los Angeles, CA 90067
    USA
    Tel: +1 310 407 5700

    Miami

    Goldman, Sachs & Co.
    First Union Financial Center
    200 South Biscayne Blvd.
    Suite 3700
    Miami, FL 33131
    USA
    Tel: +1 305 755 1000

    New York

    Goldman, Sachs & Co.
    85 Broad Street
    New York, NY 10004
    USA
    Tel: +1 212 902 1000

    Goldman Sachs Asset Management
    32 Old Slip
    17th Floor
    New York, NY 10005
    USA
    Tel: +1 800 526 7384

    Philadelphia

    Goldman, Sachs & Co.
    Mellon Bank Center
    1735 Market Street
    26th Floor
    Philadelphia, PA 19103
    USA
    Tel: +1 215 656 7800

    Princeton

    Goldman, Sachs & Co.
    701 Mt. Lucas Road
    Princeton, NJ 08540
    USA
    Tel: +1 609 497 5500

    Salt Lake City

    Goldman, Sachs & Co.
    295 Chipeta Way
    Salt Lake City, UT 84108
    USA
    Tel: +1 801 884 1000

    San Francisco

    Goldman, Sachs & Co.
    555 California Street
    45th Floor
    San Francisco, CA 94104
    USA
    Tel: +1 415 393 7500

    Seattle

    Goldman, Sachs & Co.
    719 2nd Avenue
    Suite 1300
    Seattle, WA 98104
    USA
    Tel: +1 206 613 5500

    Tampa

    Goldman, Sachs & Co.
    2502 Rocky Point Drive
    Suite 500
    Tampa, FL 33607
    USA
    Tel: +1 813 288 7500

    Washington DC

    Goldman, Sachs & Co.
    101 Constitution Avenue, NW
    Suite 1000 East
    Washington DC 20001
    USA
    Tel: +1 202 637 3700

    West Palm Beach

    Goldman, Sachs & Co.
    777 South Flagler
    Suite 1200 - East Tower
    West Palm Beach, FL 33401
    USA
    Tel: +1 561 650 1600

    Stop by their offices, or give them a call. I am sure that they would be glad to hear from you.
  • donofcali
    Your tax dollars in action. This is TARP money that was given to these bankers by their cohorts at the Treasury. This is the way our Plutocracy works.
  • moi2cents
    Plutocracy? Ha!
    At best it's a kleptocracy.

    I don't think they've been "our" dollars in any sense at all for quite some time. They just let us borrow a few from our corporate masters every now and then.
    The very best thing we could do (I mean BESIDES preparing the torches, pitch-forks, tar, and feathers) would be to demand legislation that would prevent congresspersons and their staffs (and families of same) from insider trading.
    Sometime when you feel like you aren't pissed off enough, listen to the story NPR did about this. Pay attention to how much greater the returns on investments made by our lawmakers are than returns realized by everyone else.
    Oops, never mind. Pay no attention to the man behind the curtain.
  • donofcali
    Plutocracy:
    1. Government by the wealthy.
    2. A wealthy class that controls a government.
    3. A government or state in which the wealthy rule.

    It's close to kleptocracy, but in America's case it is all done within the "legal" framework. What we need to do is burn that framework to the ground.
  • moi2cents
    Correct definitions, of course...
    But if you extend your line of reasoning, it being done within the "legal" framework, you run into some problems. (That currently one must use the quotation marks seems a bit of a problem to me.) I think it's pretty apparent that influence is peddled as a matter of course in the US congress. Campaign contributions buy influence and votes. And whether there are campaign contributions or not, there always seems to be a quid-pro-quo. Individuals exemplifying this ethical implosion are too numerous to list. Billy Tauzin comes immediately to mind.
    While chairman of the House Energy and Commerce Committee, which has oversight of the drug industry, he shopped for a better gig. Guess who he went to work for as soon as soon as he left the house? Bingo! He's the head of the Pharmaceutical Research and Manufacturers of America (PhRMA). Oh yeah, he also lobbies for 'em.
    There's Phil Gramm, chairman of the Senate Banking Committee from 1995 through 2000. He long championed banking deregulation, "he played a leading role in writing and pushing through Congress the 1999 repeal of the Depression-era Glass-Steagall Act, which separated commercial banks from Wall Street [...], inserted a key provision into the 2000 Commodity Futures Modernization Act that exempted over-the-counter derivatives like credit-default swaps from regulation by the Commodity Futures Trading Commission. Credit-default swaps took down AIG, which has cost the U.S. $150 billion thus far."
    "Gramm was one of five co-sponsors of the Commodity Futures Modernization Act of 2000. One provision of the bill is often referred to as the "Enron loophole" because some critics blame the provision for permitting the Enron scandal to occur. [...] Gramm's wife, Wendy Lee Gramm, was on the board of directors of Enron when it collapsed, and she was named in many of the Enron shareholder lawsuits."
    Guess who Phil-my-pockets Gramm works for?
    "As of 2009, Gramm is employed by UBS AG as a Vice Chairman of the Investment Bank division. UBS.com states that a Vice Chairman of a UBS division is "...appointed to support the business in their relationships with key clients." He joined UBS in 2002 immediately after retiring from the Senate."
    Guess who those "key clients" are?

    I'd go ahead and call it violation of at least the spirit of the law. And you may not believe (yeah, it's probably a stretch), but it looks an awful lot like theft to me. He misappropriated the money he was paid to represent constituents, instead using his time to set himself up.

    <sigh>...never mind. You're right.
    And yeah, "burn that framework to the ground"!
  • profitnot
    I hate to take away some fuel for your fire, but Goldmand-Sachs paid back the TARP money that they received. I agree, however, that it feels rotten to see those lucky SOBs profit like that. Tell me you would turn down your bonus if you happened to be working there.

    http://www.financialstability.gov/docs/transact...
  • Name
    A bunch of scum sucking leeches.
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