Gov't got Huge Bonuses before and during crisis
For those who think that big business and their greedy bonuses were responsible for the meltdown of the capital markets, you should see the bonuses that their regulators were getting. This went on both before and during the crisis (See http://bit.ly/abyY5m). It's enough to make you want to hurl. Not because the regulators didn't do their job. They couldn't. But because now, they have the audacity to say that the bonus culture was at the heart of the financial meltdown.
Banks weren't the only ones giving big bonuses in the boom years before the worst financial crisis in generations.The government also was handing out millions of dollars to bank regulators, rewarding "superior" work even as an avalanche of risky mortgages helped create the meltdown.
Just as bank executives got bonuses despite taking on dangerous amounts of risk, regulators got taxpayer-funded bonuses despite missing or ignoring signs that the system was on the verge of a meltdown. The bonuses were part of a reward program little known outside the government. Some government regulators got tens of thousands of dollars in perks, boosting their salaries by almost 25 percent.
During the 2003-06 boom, the three agencies that supervise most U.S. banks - the Federal Deposit Insurance Corp., the Office of Thrift Supervision and the Office of the Comptroller of the Currency - gave out at least $19 million in bonuses, records show.
Nearly all that money was spent recognizing "superior" performance. The largest share, more than $8.4 million, went to financial examiners, those employees and managers who scrutinize internal bank documents and sound the first alarms. After the meltdown, the government's internal investigators surveyed the wreckage of nearly 200 failed banks and repeatedly found that those regulators had not done enough.