The Hindu Business Line : Greed Inc.

At a time when most companies in the US and the UK have to be propped up by hundreds of billions of dollars (or pounds) of taxpayers’ money, the reckless abandon with which the top executives of those companies are lavishing bonuses and other perks on themselves beggars description. Within a few days of receiving a bailout of $122.8 billion from the US Government, the top executives of the giant insurance company AIG gave to themselves an outrageous bash at a luxury resort.

New stories of similar instances of vulgar exhibitionism by failed companies saved by taxpayers’ money are hitting the headlines. Here is a particularly nauseating one. It is reported that in early 2008, just as Merrill Lynch CEO John Thain was preparing to slash expenses, cut thousands of jobs and exit businesses to fix the ailing securities firm, he was also spending company money on himself.

To wit: $1.22 million to refurbish his office, by hiring on payment of $800,000 the famed celebrity designer Michael Smith, who is currently redesigning the White House for the Obama family for just $100,000; $131,000 for two fabulous rugs; a “mahogany pedestal table” for $25,000; a “19th Century Credenza” in Thain’s office for $68,000; a sofa for $15,000; four pairs of curtains for $28,000; a pair of guest chairs for $87,000; a “George IV Desk” for $18,000; six wall sconces for $2,700; six chairs in his private dining room for $37,000; a mirror in his private dining room for $5,000; a chandelier in the private dining room for $13,000; fabric for a “Roman Shade” for $11,000; a “custom coffee table” for $16,000; something called a “commode on legs” for $35,000; “Regency Chairs” for $24,000; “40 yards of fabric for wall panels,” for $5,000 and a “parchment waste can” for $1,400.

The private sector top bosses in the UK are in a rush to give to themselves huge bonuses before any crackdown occurs. For instance, the Royal Bank of Scotland (RBS) will pay close to £1 billion in bonuses, just months after it was rescued by a £20 billion taxpayer bail-out.

Obscene display

A report in The Times reveals that Lloyds, which has taken £17 billion from the Government, is ready to give away hundreds of millions of pounds as bonuses, while Barclays, to which the Bank of England has given billions of pounds in loans and guarantees, is bent on giving even larger bonanzas.

In the US, the amounts that the senior executives of companies have lavished on themselves have exceeded $20 billion. No wonder, the President, Mr Barack Obama, is incensed, castigating it as “the height of irresponsibility (and) shameful”. He has since imposed a pay ceiling of $500,000 per year for the top brass.

In India too, the media is agog with reports of the founder-chairman of Satyam Computer Services, Mr Ramalinga Raju, having more than a thousand designer suits, 321 pairs of shoes of the latest fashion, 210 leather belts and a telescope priced at more than a crore of rupees.

The Forbes magazine in its website talks of a 27-storey skyscraper being built in Mumbai by Mr Mukesh Ambani, which, it says, could be the world’s largest and costliest home with a price- tag nearing two billion dollars. “When the Ambani residence is finished, completing a four-year process, it will be 550 feet high with 4,00,000 square feet of interior space,” it says.

The Government should lose no time in bringing forward legislation to stop such obscene display of irresponsibility and shamelessness on the part of the country’s business tycoons. Otherwise, India will get into the same predicament as that of the US and the UK.

B. S. RAGHAVAN

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