5 myths about Wall Street pay days


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Published in The Washington Post October 25, 2009 by Roy C. Smith
The financial crisis is now more than a year old, and Americans are still angry — angry that the economy tanked, angry that they’re out of work. But mostly, people seem outraged by Wall Street bonuses. Seeking to assuage that ire, the Obama administration’s “compensation czar,” Kenneth Feinberg, last week announced plans to cut the pay of top executives at the seven companies receiving federal support through the Troubled Assets Relief Program. He has suggested that the cuts, which slashed pay for top executives by an average of 50 percent, should be a model for the rest of Wall Street and corporate America. In outlining the change, Feinberg has had to grapple with several misconceptions about Wall Street bonuses — myths that have circulated since the beginning of the crisis.

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