So locking the stable door after the horses looted the barn and burnt it to the ground before bolting.
By law, Bankers should be paid no more than public officials.
https://www.tagesschau.de/wirtschaft/weltwirtschaft/credit-s...
How were shareholders OK with this? After all, top executives are still "just" employees of the real company owners - stock owners.
And who is going to make sure they do amazingly well in the interviews for a role like this but people who would have no problems making their bosses really love them?
Credit Suisse paid a decent dividend [1]. Also, calling a spade a spade, the Saudis are this cycle's German landesbank: dumb money.
How would you intend to enforce this? Declare a law that no banker must be paid more than than the current highest government salary? Who defines a "banker"...does that same rule apply to the CEO?
I understand that Credit Suisse is a poorly-run and incessantly corrupt company, but many times, people suggest "hey, that should be a law!" without thinking it through.
Salaries of government employees and public officials are already dictated by laws in most countries, so this isn't like it is some sort of new area of legislation that doesn't have decades of legislation and case law for reference.
By law.
> Declare a law that no banker must be paid more than than the current highest government salary?
No. Simply have a law that employees of a bank that has been deemed "too big to fail" will be regarded as public employees (which they effectively are) and are paid according to the BAT, the Bundesangestelltentarifvertrag, in Germany. Other countries will have similar official regulations as to how public sector employees are paid.
"Too big to fail" = "Too big to bonus"
> Who defines a "banker"?
Employees of a bank that has been classified as systemic, as too big to fail. If the risk is public, the pay is public. If you want private pay, your bank must be small enough that the public does not carry the risk.
> ..does that same rule apply to the CEO?
Of course. Especially to the CEO.
> ...without thinking it through.
Just because you haven't thought this through doesn't mean I haven't.
> Credit Suisse is a poorly-run and incessantly corrupt company
This isn't a singular problem of Credit Suisse. 2008 was just the same, only (so far) on a larger scale. I am usually extremely loath to declare simple/moralistic causes for what appear to be complex and systemic issues.
But in these cases, it really was that simple. The bankers knew that it was a sham. They kept the sham going because they wanted to get theirs before the music stopped. When the music stopped the public had to bail them out. And the bankers were still rich. Because profits were privatised and risk was socialised.
Fool me once, shame on you, etc.
But then all the experienced bankers will leave for another country. We can't not let them leave.
The government is already bad enough.
(No, this doesn't make any sense either)
If the risk is privatised, the profits can be privatised.
If the risk is socialised, the profits are also socialised.
Simples.