What’s Good for Goldman Sachs is Good for Everyone?

A spokesman for Goldman Sachs defends their pay practices:

…[A]ccording to a Goldman adviser, Wall Street’s record pay is necessary “to achieve greater prosperity and opportunity for all”:

A Goldman Sachs International adviser defended compensation in the finance industry as his company plans a near-record year for pay, saying the spending will help boost the economy. “We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all,” Brian Griffiths … said yesterday at a panel discussion hosted by St. Paul’s Cathedral in London.

At the same time that Wall Street’s pay has skyrocketed, pay cuts in other sectors “are occurring more frequently than at any time since the Great Depression.”…

A defense of inequality and trickle down in one statement. That’s a political winner. By the way, there’s little evidence for either claim. Trickle down doesn’t work, and recent increases in inequality have not led to higher economic growth than we had before.

About Mark Thoma 243 Articles

Affiliation: University of Oregon

Mark Thoma is a member of the Economics Department at the University of Oregon. He joined the UO faculty in 1987 and served as head of the Economics Department for five years. His research examines the effects that changes in monetary policy have on inflation, output, unemployment, interest rates and other macroeconomic variables with a focus on asymmetries in the response of these variables to policy changes, and on changes in the relationship between policy and the economy over time. He has also conducted research in other areas such as the relationship between the political party in power, and macroeconomic outcomes and using macroeconomic tools to predict transportation flows. He received his doctorate from Washington State University.

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