On January 15 there was an article on BBC news online titled JP Morgan Chase reports $3.3bn profits, followed by the sentence “Wall Street bank JP Morgan Chase has reported profits of $3.3bn for the last three months of 2009.” The article continues to compare the last three month profits of 3.3 billion to the total profits of 702 million at the end of 2008. The total profits for the year of 2009 were 11.2 billion where as the total staff compensation (salaries and bonuses) is around 27 billion. And investment bankers as individuals made a grand total of about 9.3 billion.
Ethical Issue: The investment bankers received a bonus that was 21% higher from the previous year, even though the company (JP Morgan Chase) lost 2.2 billion just in credit card business in the year 2008. So where is all this money coming from, that investment bankers are receiving? President Obama stated “If these companies are in good enough shape to afford massive bonuses, they are surely in good enough shape to afford paying back every penny to taxpayers"
Aristotle would argue the two senses of wealth being the art of acquisition which has limits; once we reach what we need we don’t need it anymore and the art of wealth-getting where riches and property have no limits. But are there are really no limits? Aristotle believes that business is necessary but looks down on corporation as a whole. Aristotle states that “true wealth is limited, but money making has no limit” (70). If JP Morgan is giving out 9.3 billion dollars in bonuses Aristotle would argue that the company should share when it is essential, if poverty levels are going up and companies are distributing billions of dollars in bonuses, then those individuals should pay taxes, and not be given special treatment.
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I definately agree that if JP Morgan can pay out the extra earnings or the profit earned in bonuses, they should first pay back the bailout money they recieved to help get them to a profit in the first place. It is the taxpayers money that helped the bank to reach a profit, so rightfully once the bank gets to that point they should give the money back. This is were we see that today people don't agree or follow the way Aristotle thought. Although the backs can limitlessly earn money from our money they shouldn't, according to Aristotle, because they are gaining more then they need to achieve living well in Aristotle's eyes.
ReplyDeleteI must agree that investment bankers should not receive huge bonuses when our economy is in a deficit and as a result many people are unemployed. It is often said that money is power, in Aristotle's book "Politics" he mentions that people often have a perverted view about wealth and that to truly live well one must not seek profit (money), but those things that maintains life. However, he did not address the reality that people thrive on having power and that money is power to most people. This may be the reason why some people desire more money. Just think about people like, Oprah Winfrey and Bill Gates do we look up to them because their philanthropists or because their wealthy individuals with influence and power?
ReplyDeleteI totally agree with what you stated in your blog about wealth-getting has its limits, heck, everything has its limits. If one puts too much air pressure in a tire, it would blow up; if one stays in the cold for too long, he would freeze. I believe the creation of money was based on fair exchanging or trading solely, so people would have a better idea of what their goods valued when engaged in the open market. With that being said, what JP Morgan did was to create a bigger gap between the riches and the poor in a huge gap that's been already existing between the two. I do not think that's the idea behind wealth-getting, that's called being greedy.
ReplyDeleteI guess it is hard to change someone's mentality sometimes in today's world where everything is involved with money, unless we change our fundamentals on the meaning of money, and understanding the true meaning of living, that would never be changed.
I have to agree with you as well. The banks and corporations are completely are out of control. It seems as if the rules or the laws don't apply to them. Their profits and bonuses grow despite the bad economy. They never give anything back to the customers besides high interest rates. The least they should do is at least be involved in corporate social responsibility. For example, all these banks donated money money to Haiti, but whats a million dollars from a company that made 3 billion dollars in profits just for one quarter. I think they could offer more than that because individuals made bigger donations than that. It seems that all they care about is profit and its something Aristotle would disagree with. Unfortunately it doesn't look like anything is going to change in the near future until we actually start treating these banks like they treat everyone else.
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ReplyDeleteFor starters great article and good argument. I say this because you have a good valid argument regarding the fact that they need money to stay alive; and since the goverment rushed to their assistance with bailout money, they should pay back their debt before distributing bonues. Also we need to remeber that JP Morgan in banking idustry, so creating a profit off money as a result creating more money. Hopefully president Obama can get his bill passed that will tax theses banks who turning around a profit with money we lent them
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