Last year, 25 hedge fund managers earned a combined $22 billion

If I were a major shareholder, the first thing I'd demand is that a test of managers' worth be done. Set up a few theoretical funds with spreadsheets, full of what-ifs such as how much money is invested in total, and with goals for each fund (such as a certain amount of gain, or safety). Then, take some people with minimal finance experience, like new college grads, and pay them $50000 a year each; pit them against the hedge fund managers for the same funds.

For a few months, everyone has to try to work those fake funds; they must use real market values and suggest decisions based on real data, but obviously the funds contain no real money and the effects would just be calculated. Here's the best part: since the real managers are making over 100 times what the grads would make, they had better have some pretty damned impressive results. If the grads come anywhere near what the managers do, the managers will automatically have their pay docked accordingly. In other words, if they aren't astronomically better when applying their "experience" to a few simple tests, why the hell would any investor continue to tolerate paying these managers so much?

What's the justification for management fees at all, let alone such a steep one? Their cut of the profit in fat years should be enough to keep the doors open in lean ones. Such fees also create a perverse incentive to simply get as much money under management as possible.