OK, that’s way too strong. But Alistair Darling’s new super-tax on bank bonuses sounds like a good idea, on first read. Or as Justin Fox puts it, why the heck not?
Are we afraid that the best and the brightest will leave high finance and pursue other occupations? That strikes me as a good thing: everything we know suggests that the rapid growth in finance since 1980 has largely been a matter of rent-seeking, rather than true productivity. (As Paul Volcker says, it’s hard to come up with any clearly productive financial innovations of recent decades other than the ATM).
Or are we worried that it’s just unfair to discriminate against high-earning bankers? Bear with me while I stop laughing. More seriously, the whole sector has just been bailed out at immense taxpayer expense. Some payback seems entirely reasonable.
So, the details need analyzing. But on the face of it this looks entirely reasonable.
10 December 2009
10 December 2009
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