Goldman Sachs, Toll Roads, Conflicts of Interest and BIG HONKING BONUSES
23 December 2007 at 11:03:54 AM
Saw via Dungeon Diary this morning that Lloyd Blankein, CEO of Goldman Sachs, who replaced Henry Paulsen, who is now firmly entrenched in the US Treasury position, got a HUGE bonus.
If there was any wonder why the rich are getting richer in America, here is a great example. Lloyd Blankfein, CEO of Goldman Sacks will be celebrating Christmas this year with a tidy $67.9 million dollar bonus. That’s $67,900,000 comprised of cash and some restricted stock. Exorbitant? Maybe but Goldman Sacks seems to have avoided the sub-prime mortgage debacle ...
Your critics presume the worst about Goldman’s conflicts of interest. What’s your response?
We take the management of conflicts very seriously. Investment banking has evolved in the past few years. The days of only providing advice are gone. Now clients ask us to advise, finance and, sometimes, invest alongside them. Not only is that easy to reconcile, being a major provider of capital is a good way of ensuring that the advice offered is effective. By the way, at least three quarters of everything we invest in is done at the behest of clients.
One would think that netting this type of money that allows a company to pay THAT kind of bonus ought to be outlawed, especially when at least some of it comes from crooked methods and bilking the public out of public highways.
Here, as a reminder is Mark Florian, COO of the Municipal Finance and Infrastructure Group who also manages the North American Infrastructure Investment Banking Business, testifying before the Texas Legislature in March of 2007.
P.S. Does it strike anyone else as more than unfortunate that the man who is right now in charge of the US Treasury, Henry Paulsen,is also the same man who was CEO at Goldman Sachs when they were accused of such things as conflict of interest? And whose response in the article quoted above was, basically, that people's *perceptions* of the confilct should be changed?