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Mar. 17th, 2009 01:07 pmOne of the mistakes we in the UK often make is that we assume that the Americans pay as much attention to us as we do to them. Just a few nanoseconds' thought would show this to be utter tosh and any encounter with MidWestMan in Vegas would confirm it; The US pays absolutely no attention to what is going on in Britain at all.
Further proof was provided this morning when Fred Goodwin II ("This time it's real money"), aka, the AIG bonus debacle, hit the headlines. "Obama pledges action to block $165m bonus payments by AIG", ran the headline in this morning's FT, indicating that no-one in the US had even noticed the announcement at the end of February by the now strangely reticent Harriet Harman that Sir Fred "should not count" on receiving his pension. The tone has now changed, with Lord Minus now saying that "it's still not too late for Sir Fred to do the right thing". Do the right thing? Is he sure? This is Sir Fred Goodwin we are talking about, the man who is pissing all over you. What on earth makes you think he might "do the right thing". Indeed, what he's done instead of handing back some of his £700k a year is (and all credit for blinding chutzpah here!) taken £3m of it in advance. Marvellous.
The government in the UK has finally realized that opprobrium is just about its only weapon, and it doesn't look to be that powerful a weapon at all.
So, the portents for the young Obama administration (Obamalets?) are not good. The AIG guys have, like Sir Fred, got their contracts tied up well. Chances might be slightly higher in the US because performance-related bonuses just might, just might, stand up less in court than pension rights in the UK — the latter having been sealed up and encapsulated in such watertight laws that taking any of the money back from Sir Fred would require legislation undoing 19 years of legal thinking (passim Robert Maxwell and the Mirror Pension Fund). Indeed, the people really rubbing their hands in the US and in the UK are probably the lawyers. Despite talk of 20% layoffs at the big corporate lawyer firms (most of whom, I am pleased to say, have the wisdom to subscribe to my august publication), I would think that over the next few years there will be bundles of business appearing in the "I owe, you owe" market.
The lawsuits flying around re Madoff seem to hint that it hasn't sunk in with a number of people that this is not a case of money being "stolen". You can't steal what wasn't there in the first place, except in thousands of people's imaginations. If you look at what went into Madoff, calculate what he spent, and what he paid out in "interest", then it's not difficult to see where all the money went. The difficult question is, to what extent do you penalize the "guilty" investor in order to help the "innocent"?
This is the basic confusion that is arising that no-one seems to be addressing. Already it's stated that someone who had his or her money invested in Madoff, but was unaware that that was where it was, should not have to pay the "interest" back (the legal difficulties of getting hold of it aside), while there is talk that those who borrowed cheap to invest long with Madoff "deserve all they get".
Splitting up morality from factual loss is a muddy area that lawyers love. It's an easy area to exploit (I could do it myself at great length, but, you will be pleased to hear, I won't) and it doesn't have to be burdened with hard numbers. We can all remember how Clay Davis performed in front of a Baltimore jury (The Wire, Series Five), and hard numbers had nothing to do with it.
All of this also comes down to a muddying of the words "justice" and "the law". It's no use a lawyer, or a judge, saying that they represent both, because as far as I can see, the correlation between the two is distinctly negative. To say that you are fighting for both leads to inherent contradictions. But lawyers love contradictions, because it allows them to argue on either side when it suits their purpose.
+++++++++++
Further proof was provided this morning when Fred Goodwin II ("This time it's real money"), aka, the AIG bonus debacle, hit the headlines. "Obama pledges action to block $165m bonus payments by AIG", ran the headline in this morning's FT, indicating that no-one in the US had even noticed the announcement at the end of February by the now strangely reticent Harriet Harman that Sir Fred "should not count" on receiving his pension. The tone has now changed, with Lord Minus now saying that "it's still not too late for Sir Fred to do the right thing". Do the right thing? Is he sure? This is Sir Fred Goodwin we are talking about, the man who is pissing all over you. What on earth makes you think he might "do the right thing". Indeed, what he's done instead of handing back some of his £700k a year is (and all credit for blinding chutzpah here!) taken £3m of it in advance. Marvellous.
The government in the UK has finally realized that opprobrium is just about its only weapon, and it doesn't look to be that powerful a weapon at all.
So, the portents for the young Obama administration (Obamalets?) are not good. The AIG guys have, like Sir Fred, got their contracts tied up well. Chances might be slightly higher in the US because performance-related bonuses just might, just might, stand up less in court than pension rights in the UK — the latter having been sealed up and encapsulated in such watertight laws that taking any of the money back from Sir Fred would require legislation undoing 19 years of legal thinking (passim Robert Maxwell and the Mirror Pension Fund). Indeed, the people really rubbing their hands in the US and in the UK are probably the lawyers. Despite talk of 20% layoffs at the big corporate lawyer firms (most of whom, I am pleased to say, have the wisdom to subscribe to my august publication), I would think that over the next few years there will be bundles of business appearing in the "I owe, you owe" market.
The lawsuits flying around re Madoff seem to hint that it hasn't sunk in with a number of people that this is not a case of money being "stolen". You can't steal what wasn't there in the first place, except in thousands of people's imaginations. If you look at what went into Madoff, calculate what he spent, and what he paid out in "interest", then it's not difficult to see where all the money went. The difficult question is, to what extent do you penalize the "guilty" investor in order to help the "innocent"?
This is the basic confusion that is arising that no-one seems to be addressing. Already it's stated that someone who had his or her money invested in Madoff, but was unaware that that was where it was, should not have to pay the "interest" back (the legal difficulties of getting hold of it aside), while there is talk that those who borrowed cheap to invest long with Madoff "deserve all they get".
Splitting up morality from factual loss is a muddy area that lawyers love. It's an easy area to exploit (I could do it myself at great length, but, you will be pleased to hear, I won't) and it doesn't have to be burdened with hard numbers. We can all remember how Clay Davis performed in front of a Baltimore jury (The Wire, Series Five), and hard numbers had nothing to do with it.
All of this also comes down to a muddying of the words "justice" and "the law". It's no use a lawyer, or a judge, saying that they represent both, because as far as I can see, the correlation between the two is distinctly negative. To say that you are fighting for both leads to inherent contradictions. But lawyers love contradictions, because it allows them to argue on either side when it suits their purpose.
+++++++++++
