Bonus bashing is NOT attacking wealth creation

Banker bashing (and CEO rewards in major businesses) continues to be much in the news. Much of the comment is about how to cut complex remuneration packages down to 'reasonable'. At a detail level some useful proposals are debated - including how do you define 'reasonable'. There are also some spirited defences of the current incentive system & resultant remuneration outcomes which include some valid comments. But the ALL miss the point. Few people would object to wealth creation. Few people would object to wealth creators getting rich. The problem is that, more often than not that is not what is happening. If it was we would see a fall in unemployment - not a rise & a growth in the economy. It has been said that we need a banking industry to oil the wheels of commerce. Of course we do but the banks are not lending to precisely those wheels. Instead we see that too many banking activities are for the benefit of the banking industry. Huge rewards are not 'earned' in the minds of ordinary citizens who struggle to get by, by shedding thousands of staff and seeing a share price tumble. Most of us do not get well paid for turning up at work and then getting triple pay whenever we do anything, be it good or bad. Then there is the ' we have to pay for scarce talent' myth. In a splendid letter to the FT of 11th Feb, Stella Pantelides points out if Boards had a Nominations Committee that was doing its job they would be identifying talent lower down the hierarchy who could increase the supply of potential CEOs. But that would dispel the 'scarcity' argument. Until these issues are effectively addressed bonus bashing is justified. I'm not holding my breath that George Osborne will deal with them