Can Wall Street give in?
Economist Katerina Alexandraki has one good idea with the excessive pay that Wall Street executives are getting this year – hand them out to the people who are on the brink of losing their homes. In her website, she posts, “The initiative is driven by two principles: First, that the solution to the bonus “problem” should be private-sector driven; and second, that the funds raised should be targeted to those who need it the most and who were possibly fooled the most.
“To this end, we are setting up a fund, whereby Wall Street professionals can contribute a portion of their 2009 bonus, which will be then directed towards providing debt relief to specific groups:
(a) low-income households and victims of predatory lending who either lost their home due to a home equity loan (HEL) or are facing foreclosure from a HEL; and
(b) long-term unemployed who are also facing foreclosure.”
This sounds too easy but I’m not getting a good vibe out of this initiative by Alexandraki even if she’s targeting those who didn’t take out loans that they couldn’t afford paying back in the first place. Don’t get me wrong with her intentions. Sure it’s a good way to help the victims of predatory lending but will anybody from Wall Street be so easily swayed to give in to her requests? Again, it’s not that easy.
First, other than a limited exposure created by BusinessWeek and some news websites for her petition, Alexandraki would need more publicity. In this time and age where philanthropy is often misunderstood by many to be their venue for self-promotion or corporate advertising, these rich folks need their 5-minute TV spot or their place in news sites as to how they sacrifice $100,000 in bonuses for the sake of charity. I’m not tolerating this behavior but I’m pointing out the situation that can block Alexandraki’s efforts.
Second, she’s looking for volunteers who will tap the consciences of these Wall Street execs. I’m thinking how they’ll do this. Hold a rally in front of Citigroup? Or write a letter to BofA’s Board of Directors? Some things need to be clarified first.
Perhaps, Alexandraki needs some backing from Kenneth Feinberg if she wants real results.