Gross: Wall Street Considers Early Bonuses if Bush Tax Cuts Get Slashed

In perhaps one of the starkest examples of why the Bush Tax Cuts for rich people need to be cut, Wall Street is considering speeding up its notoriously fat bonuses in case their disproportionate tax breaks come to an end. Generally offered at the beginning of the year, Goldman Sachs and other firms may dole out the dough this month in lieu of being taxed more under an Obama plan. The fact that they're freaking out about their end-of-year cash cows just as the unemployment rate nears 10 percent is disgusting, but not surprising––as the Timesreports:

Wall Street firms pay out billions of dollars in bonuses each year. In good years top executives can receive bonuses worth tens of millions of dollars. Even midlevel financial workers often earn above $250,000 a year, and they receive most of their compensation as bonuses paid early in the new year.

Extending the tax cuts for all Americans with taxable income over $250,000 for joint filers ($200,000 for single filers) would cost the country about $40 billion next year, according to the Joint Committee on Taxation, and it would cost $700 billion over the next decade.

Currently the highest rate for taxable income is 35 percent; that would increase to 39.6 percent if the Bush tax cuts expire this year.

The top five Wall Street firms have put aside nearly $90 billion for total pay this year, and they are expected to raise that amount using their end of year earnings. That would make this year one of the best ever for bank pay.

So yeah. The country's in a grave recession, families are struggling by their bloody fingernails to survive, and Wall Street has a record year not long after it gets bailed out. Sounds about right. Here's the rest of the piece.

AlterNet / By Julianne Escobedo Shepherd

Posted at December 6, 2010, 4:41am

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