When discussion of an auto industry bailout began to circulate, some people pointed out, as evidence of the shameful sloth of its unionized work force, the United Auto Workers’ jobs bank, in which employees continue to get 95 percent of their base pay and all their benefits if they are laid off. In the heyday of the program (before the most recent round of contract negotiations), the jobs bank cost GM almost a billion dollars a year, which is to say, slightly more than GM was paying out in dividends to its stockholders.
Imagine that, paying people who aren’t doing any productive labor for your company! Any corporation that suffers such indolence does not deserve to suck at the federal teat. (And indeed, the UAW indicated that it would accept an end to the jobs bank program as one of the strings attached to a bailout.)
Inside what’s left of Wall Street, investment bankers are doing all they can to cope with a business that is disappearing before their eyes. Yes, there are tens of thousands of people still with jobs. They just don’t have much work. Debt and stock markets are virtually shut, merger volume is down by 28%, and whole lines of structured finance are closed for good…
For now, the coping is taking the form of prolific meeting-taking. Ten of 11 people interviewed described, with unexpected eagerness, how now is a good time to “connect with clients” or “build relationships.” One boasted of spending just two days a month in the office, while another ex-J.P. Morgan employee boasted of two breakthrough meetings — just hours before he was fired.
The bankers say that the most substantive conversations are, surprise, those with companies in urgent need of cash. These companies will listen to anyone who may have a creative idea or two. With markets frozen, there is little work to actually complete. “What’s your definition of business?” snapped one Merrill Lynch executive.
The article also mentions in passing that on the brave new Street, “a $700,000 salary is deemed generous”. O the humanity.
(Disclaimer of vested interest: We drive a 1999 Ford Windstar minivan which truly lives up to the motto “Fix Or Replace Daily”. And when we finally replace it, we’re not going to the Big Three.)
via Making Light