Official Banker Backlash: Record Bonuses While Families Struggle to 'Stay Afloat'

Morgan Stanley, meanwhile, is preparing to defer 65 percent of compensation for its 25 top executives and tie a quarter of their compensation to firm performance measures, a person familiar with the bank's compensation plans told It established clawback provisions last year, the person said. (Morgan Stanley made headlines over compensation last month when Mack became the first big bank CEO of 2009 to announce that he was forgoing his annual bonus, a move that Mack also made in 2007 and 2008.)

Bank of America told ABC News that it, too, is tying its compensation to bank performance -- specifically, the bank's stock price -- and that it also will defer much of its bonus awards.

"We understand the anger felt by many citizens," Moynihan said at today's hearing, explaining that Bank of America's compensation pool this year will be greater than last year's but "certainly not back to pre-crisis levels."

JPMorgan is expected to devote a smaller percentage of its revenues to compensation than it did the year before, though actual compensation levels will probably rise because the bank's earnings were significantly higher in 2009 than 2008. In October, the bank reported third-quarter earnings of $3.6 billion, nearly seven times its earnings for the same period the previous year.

At today's hearing, Dimon defended his firm's pay practices.

"Before the financial crisis and since, we have used a disciplined and rigorous approach to compensation," he said in prepared remarks.

JPMorgan is scheduled to announce its final 2009 compensation totals on Friday, with others making their own announcements next week. As of the first nine months of 2009, JPMorgan set aside $21.8 billion for compensation, second only to Bank of America, which reserved $24.2 billion.

For the Obama administration, such astronomical sums are not only infuriating, but also damning. Since the administration took office in January 2009, President Obama and his economic team have vowed to change the ways of Wall Street.

On Jan. 29 of last year, President Obama denounced Wall Street's bonuses as "shameful" and "the height of irresponsibility."

"There will be a time for them to make profits and there will be time for them to get bonuses," he said. "Now is not that time."

In May, Treasury secretary Tim Geithner stated, "I don't think we can go back to the way it was. That would not be responsible for us, not good for our financial system. So I think we're going to need to see very, very substantial change in practice."

And in September the President delivered a stinging speech on Wall Street, declaring, "We will not go back to the days of reckless behavior and unchecked excess at the heart of this crisis, where too many were motivated only by the appetite for quick kills and bloated bonuses."

Not Enough Change?

Just last month, Obama again voiced his frustration with the big banks.

"They don't get it," he said in a "60 Minutes" interview. "They're still puzzled why it is that people are mad at the banks. Well, let's see. You guys are drawing down $10 million, $20 million bonuses after America went through the worst economic year that it's gone through in decades and you guys caused the problem."

"I did not run for office," he said, "to be helping out a bunch of fat cat bankers on Wall Street."

Despite all the administration's tough talk, critics claim little has changed.

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