Should Bad Behavior Be Rewarded?
Published: January 24th, 2012
By: Jim Mullen

Should bad behavior be rewarded?

When money managers are asked why they deserve tens of millions of dollars for pushing around other people’s money, the answer is always, “the risk.” They took the risk; they made the bet and won. To the victor go the spoils.

That makes a lot of sense. When you take a big risk, you deserve to make a lot of money. You deserve the beachfront house, the private jet, the second home in Aspen. Sure, that’s the same thing drug kingpins say, but there’s one big difference: When drug dealers make the wrong bet, they go to jail. When money managers lose a bet, they get a bonus.

“Oh,” you might say, “but the money managers didn’t break the law.” Really? Who told you that? Oh, the money managers.

I had a friend who chased down a purse-snatcher in Manhattan once and tackled the thief in a busy midtown crosswalk. The first thing out of the purse-snatcher’s mouth was, “I didn’t do anything!” He kept yelling that at the top of his lungs. When the police arrived, they wanted to arrest my thief-tackling friend instead, until the woman whose purse was stolen finally set them straight.

So all the Wall Street money managers are yelling that they didn’t do anything. I keep wondering, when are all the people whose purses were stolen going to set them straight?

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