THE BLOG
10/19/2008 05:12 am ET | Updated May 25, 2011

Wall Street greed and contributions should be illegal

In 2006, the big five Wall Street firms handed out bonuses to their worldwide employees equivalent to the GDP of Vietnam or about $70 billion.
Now to fix the mess, the big five helped create, will cost probably US$1 trillion, or an amount equivalent to the GDP of India. Some believe costs may hit US$2 trillion, equivalent to two foolish wars in Iraq or the British economy.
Frankly, every employee of these firms -- including U.S. Treasury Secretary Henry Paulson who made an obscene $800 million as head of Goldman Sachs before joining the cabinet -- should be sued on behalf of taxpayers to help defray losses they helped create.
But that won't happen because Wall Street firms were also the biggest lobbyists and political campaign contributors to both parties.
Now only two of the five Wall Street giants have survived and in a few weeks both of those - Goldman Sachs and Morgan Stanley -- will likely be taken out by bigger, heavily regulated entities.
No other capitalist country has perpetuated such greedy, reckless practices. Europe and Canadian financial institutions are properly regulated and clustered into a smaller number of conglomerates. These are headed by more conservative bankers who have not indulged in obscene payouts, bonuses and stock options.
Now the world's central banks are helping the Americans bail out their uncontrolled Wall Streeters -- unfair considering that they do a decent job of regulating themselves.
If Americans learn nothing from this latest fiscal crisis, it is that the role of government is essential in protecting capitalism and the absence of it, destructive.
It is also that governments should pay for election costs, as they do in Canada and other European countries, to eliminate the corrupt practices that have resulted from obscene campaign contributions.