Bonus Cuts Hurting More Than Top Wall Streeters

People in a wide range of jobs, accustomed to year-end bonuses to meet their expenses, are trimming back.

Comments: 125

  1. For those with loans, it is a sad situation. Debt burdens can be quite high. And there is no doubt that bonus money is a form of stimulus that makes its way through the consumer economy. But really, if your bonus money goes to "maintenance" where is the rest going? You should have plenty of money saved in that case.

  2. Is the NYT doing comedy and satire now?

    First I read "Anthony Abraham, 33, a management consultant in Chicago, is already figuring he will not be buying a new car, and has canceled a trip to Paris" for lack of a bonus which he had planned upon but then I read that he claims that "his bonus has typically gone to basic lifestyle maintenance, not frivolity, he said, adding, “It’s not the kind of money where I could head down to the Ferrari dealership.”

    Ummmm... so where exactly on the scale of basic lifestyle necessities does a trip to Paris fall on the list of priorities? Before the electric bill but after fixing the washing machine? Or is it the other way around?

    If he can't manage to live on $135,000 a yer including buying a new car - something that should only be necessary every 8 -10 years unless one is a travelling salesman - then he needs to pay someone to manage his budget.

    I will happily volunteer for the job and will only charge him 20% of everything I can save money on that he has been spending on of he thinks that a trip to Paris is basic lifestyle. I figure I should easily net around $15,000 - $20,000 from such a project!

    No wonder US households are broke!

    Seriously, anyone who knows that there is a possiblity a bonus may or may not happen, and that the amount of the bonus can go up and can go down but who treats it as a guaranteed amount of their income is most definitely a grasshopper rather than an ant. (Remember the children's fable? The grasshopper fritters away food and time while the ant diligently saves up for winter?)

    Bonuses are nice but are never ever to be counted upon for living expenses. When and if they come, at minimum (a) 3/4s should put into savings and (b) 1/8th used to pay down bills and (c) 1/8th for a special treat or trip. Never ever count on something that can change as easily as a bonus.

    Those in this story are grasshoppers who spent without a thought as to whether their 'bonuses' - something by definition that are vague and unpredictable - would actually be there. I definitely would not hire either of those men based upon their demostrated lack of judgment and planning.

  3. When basic financial advice consists of things like pay oneself first, don't budget raises or bonuses and live below your means, it's hard to feel sorry for people who have a six-figure income and get five-figure bonuses complain about meeting their expenses. The people in this articles are so out of touch, it actually MAKES the case for cutting bonuses. Maybe a smaller bonus is a well-timed wake up call for "trimming back" while you still have a job. In this depressed global economy, where does the Times even find these people? So you can't buy a new car or go to Paris or pay down your student loans. You also don't have to choose between paying rent or utilities or paying your student loans at all. I'm probably not the only person who thinks it this sense of entitlement that got us into this mess in the first place.

    By the way, I still managed to buy a car and go to Paris on a five-figure income and no bonus.

  4. At Citi the largest possible base pay is capped well under $200K - from the CEO to a Java programmer. The bonus is a deferred part of the comp, not a pat on the back or a "windfall." What people don't realize is that many people in IT or admin got screwed when their bonus went to zero -- effectively slashing their annual income, while the execs still got bonuses. Many people in these banks got zero bonuses, but the execs still got theirs.

  5. How does someone making 135,000 need a bonus for living expenses... Having said that I'd much rather the economy restarted and these folks got their bonuses.

  6. It may well be that many workaday Americans are trimming back their lifestyles because the bonus culture is disappearing. But a 33-year-old with a $135,000 base salary, expecting his bonus to be cut from $50,000 to $25,000, is hardly a sympathetic symbol for them.

  7. Oh, Poor Jan! He's going to have to cut back on big screen Tv's and McMansions....Gosh, the economy really is going South when they lose that bonus on top of the $108,000 they're already making. The word 'hurt' in this case might be considered hyperbole by most of the planet. Come on, Times. Really...

  8. Yonkers, New York

    19 February 2009

    Under the Obama Plan, only corporations which receive Federal bailout funds are required to limit the traditional bonuses they pay their top executives.

    Executives of all other corporattions or companies can continue to receive whatever bonuses those companies decided they can afford to give.

    As a rule, bonues are given away for good performance by executives and even employees--and only if corporations or companies do well and end up with net profits on their bottom lines.

    But top executives of corportions which suffer heavy and crippling losses and are in fact bankrupt and need Federal funds to bail them out do not deserve any bonus at all. If their boards and shareholders are on the ball, they should be kicked out for running their companies down.

    Mariano Patalinjug

  9. Its a pity bonus schemes are not lock-stock-and-barrel a part of more employment contracts. For those companies that have been savvy enough to build them into remuneration you can bet your bottom dollar they are relieved that some parts of their cost base are variable, and fluctuate on the prevailing health of the economy at a given time. Very few market analysts account for the fact that companies with flexible remuneration structures report better than expected results as variable compensation imposts are lower in "tough" years.

  10. The common man bonus cutting will have an impact - but excessive bonus for the WS honchos - who incidently are also replaceble and have miserably failed, should be taken away from the last three years. Bonus issued to these honchoes in future should also be risk based. More the risk higher the claw back 3 years from the date of bonus issue. Let us see how of these men have men left in them when bonus are linked to risks taken. Most WS honchoes are basically common pickpockets with a cheap wig for a mane.

  11. If they want to give out bonuses then give out $2,000 bonus stimulus cards which can be used for purchases at various stores around the country. It stimulates the economy and stops the complaining. $24,000 is more than a lot of people make working 40 hrs/week in a reality based job.

  12. Awwww let's vote in stimulus bill for them too since they are obviously ailing. Pardon me, but I don't feel sorry for them. I don't get a raise much less a bonus so no sympathy from. Guess you'll just have to scrimp and save like the rest of us.

  13. Visions of Clark Griswold come to mind- as his family was stiffed without the expected bonus. Look closer, 1) his family could have done without the pool, and 2) he made the down payment before he had the check in hand- not prudent.
    Referring to the several examples from the article, I don't feel an ounce of sympathy. The amount of the bonuses in case, far exceed the base salary of most Americans. Having to forgo your Paris trip this year does not constitute "hurting."

  14. It would be easy to rag on those who got big bonuses and used them to get into homes too big with TV's too big etc. It was the times for the upper middle classes. Times have changed for them too.

    I say, "...for them too," with a little smile.

    My recollection of bonuses going away began years ago. We once had a full, two week paycheck for a Christmas bonus. That ended five or ten years back. But when they took away the Thanksgiving turkey about five years back, we knew corporate America was only looking out for those at the top of the food chain.

    Basing one's lifestyle on the expected bonus was always foolish and risky. Now those who lived by the bonus will have to change. And it's going to be tougher for them than it was for us to give up that added paycheck and turkey.

  15. Welcome to the new reality. The days of big bonuses (sales related or corporate performance related) are over. Its going to take a little getting used to for everyone. We are back to the days of a 'bonus' being a 'bonus'. You don't count on getting it and you learn to live withing your guaranteed salary. If the bonus comes, great! If it doesn' doesn't.

  16. Even at this level it's really hard to feel sorry for these people.

  17. Thank goodness, yet another story about the plight of the well-off during these uncertain economic times. If I read another story about the sacrifices that people with 100K+ incomes are forced to make, I think I might scream. I only hope the guy with the sax can stay in his house so that his instrument can continue to have its own bedroom.

  18. Boo-hoo. They at least still have a very nice roof over their heads. Giving up a bonus or not complaining over a reduced one is patriotic during these times. We must all make sacrifices.

  19. Another heartbreaking portrait of struggling Americans. It leaves me wondering what I can do to help them. Perhaps if we all switch to single-ply toilet paper, we could save enough to set up a charitable fund... call it The Basic Lifestyle Maintenance Bailout...

  20. I've often wondered how my colleagues were able to survive on their meager paychecks---all without ever seeing a bonus. As a teacher I am constantly confronted with the reality that much of America has little to no sympathy for hard workers let alone teachers, but instead promotes the bonus crowd as being hard hit by these tough times. Really, we need to wake up to the real America!

    Why not write about the dire conditions in higher education where it's not unusual to find a college teacher surviving on less than $20,000 per year without benefits?

  21. I have no doubt that these people earned the bonus that they are not going to get because good old Washington says it is excessive. What good old Washington is not paying attention to is that employers all over the US are going to take this as a sign NOT to give their employees anything. ]

    These people are being paid for jobs performed, just like salesmen who get a commission on what they sell.

    What are the reps in Washington cutting? Certainly not their pensions which regular people like us have to work 20 or 30 years to get but they get it after one term in office.

    Imagine the savings if they worked it like Joe Smith? NAH This government is For the Congress, By the Congress and don't let anyone tell you different.

    I think the Government needs to stay out of this. In case no one has noticed. Everything the Government touches turns to garbage anyway.

    These people work for employers who know what they can afford to give for bonuses.

    Washington has no right to dictate. It is that simple

  22. Is it just me, or is something deeply wrong in this country, way beyond the partial loss of some end-of-year bonuses, when people still currently earning between $130 and $150-thousand dollars say they are struggling, have to cut back, and look for bargains?

  23. Once upon a time, I was a manager. Many of the management books about motivating employees say to be very, very careful about giving regular (annual) cash rewards and bonuses. The reason? Because people come to EXPECT the money. They consider it part of their regular SALARY. They expect the amount to go UP each year. And they become very, very grumpy and resentful if they don't get the money every year. I guess the financial services managers didn't have time to read any of those management books. Oops.

    This insane bonus cycle would have had to end sometime. It simply wasn't sustainable to give more and more people increasing bonuses every year. Sorry you all have to learn to live like normal people again. Most employees have never seen a bonus.

    [Far better, those experts said, for motivating employees, were non-cash rewards, like extra time off or a grateful boss, or low-cost fringe benefits like free coffee, or one-time cost extras, like comfy chairs in the break room, or event-triggered rewards (ex. we just finished a big projects - I'm buying everyone lunch).]

  24. get a real cars, Paris and a new Harley. just about as bad as the 30's! oh damn, almost forgot about the student loan.

  25. Then we should ALL get bonuses.

  26. Ohhh, boo hoo. How heartbreaking, poor people, instead of a $100,000 bonus they only get $50,000, or even worse, a paltry $25,000. When I reached the part about the guy not being able to buy a new car and canceling his trip to Paris I lost it, I still can't stop crying. Yes, this really reveals the hardships many Americans are going through, I can't imagine what I would do if I couldn't buy a house and 65" plasma TV with my yearly bonus.

  27. Wow. My heart really goes out to anyone whose bonus this year will only be slightly more than my yearly earnings. Granted... I'm a graduate student, but my goodness! If a 24K bonus isn't good enough for you, just go ahead and send it my way.

  28. I have no sympathy for people who decide to live on the largess of their employers. Either you earn a straight salary, or you get a draw against commission. Any other arrangement leaves the worker subject to the whims of the employer, who may, or may not give a bonus. Moreover, if a bonus is taxed as a capital gain and it is given regularly, and in amounts which exceed the salary compensation, then it is merely a means of evading income taxation and should be forbidden.

    Perhaps it is time to enforce the provision of the tax code that states that all imcome is taxable unless specifically excluded. There should not be any income earned in any way that is not subject to ordinary taxation unless the recipient can show that they personally have paid income taxes on those moneys in the past. Such a provision would eliminate capital gains treatment of money invested by those who themselves did not earn and pay taxes on the money that they invest. As to the argument that non capital gains treatment will destroy investment, balderdash, where else are they going to put the money, in their mattress. If the investors want to move away from the United States, fine, let them go. If you want to live here you have to pay regular income tax on everything that you earn unless you have already done so personally. That is what I would do. Fair is fair. The person who invests in the market should pay the same taxes as the person who works in a mill or on an assembly line.

  29. How tragic for him, his bonus represents four years of salary for a normal person. Talk about spoiled. HA!

  30. No trip to Paris, oh, I so feel for these people.

    You know, if I still owned student loans, I'd be paying them off before getting a new car and flying off to Paris, but, hey, that's just me, a financially responsible person. Maybe that's why I own my home with a paid off mortgage.

    And a single person blowing $135,000 a year on "lifestyle maintenance"?????

  31. Comment and satire indeed. The article literally reads like something I would expect to find in The Onion.

  32. I can't relate to this no matter how hard I try. There are millions of Americans who have had to get by in jobs that have never had bonuses. Truthfully I can't begrudge someone with a 6 figure job and a 5 figure year end bonus if they have earned it and it gives others something to aspire to. However, there is no point crying about how you can't afford a trip to Paris this year when there are people out there who work 50 hours per week without perks or bonuses just to cover rent, food, and student loans and know that they will never own a home.

  33. Sorry, I have no sympathy for such complaints. When we are willing to give underpaid public servants, such as teachers, fire-fighters, policemen, and others, such "bonuses" I will change my tune.

    Until then, I say "boo hoo."

  34. This is exactly the problem. Personal items like a big screen TV, a house, and toys are not tools of production. They are great for the individual but not society, not your neighbor, not the next generation.

    Large bonuses are great but they need to be taxed as windfall profits. One cannot argue that the bonus was the incentive to work in the first place.

  35. Somehow, when other folks are being asked to give up their homes, their meals, and their livelihoods, I don't have much sympathy for people earning "only" $135,000 per year being unable to afford a Ferrari. Of course they'll have to cut back during a depression. That's what happens to everybody.

  36. From Wikipedia:

    In 2007, the median annual household income rose 1.3% to $50,233.00 according to the Census Bureau.

    And that's household income, not individual. So this poor sap who only makes $135k a year (sob!) without bonuses is like a Wall Street broker to most of America. Satire indeed!

  37. This story illustrates how the economic crisis is more complicated than naysayers care to admit. Ex-Mayor Giuliani has already pointed out that the city used to look to Wall Street bonuses as not only an indicator of expected tax revenue, but a barometer of how others (restaurants, clothiers, etc.) would do. Of course, it's a lot easier to say "Bush is evil and he and Wall Street ruined the economy."

  38. It's incredible to me that the New York Times has persisted in reporting about the current downturn as though it were a regrettable slice in a golf game played on an island owned by a trillionaire. As millions of people lose their livlihoods, the Times is mourning the loss of some doof's trip to Paris.

    Who is this for?

    Who cares?

    It's bad enough that manhattan has become a sort of parallel Disneyland attraction --one whose price of admission is too often a trust fund. But to have the greatest newspaper in the world playing a fiddle's worth of bourgeois tripe as the whole ship goes down is too much to bear.

  39. Few years ago, former NBA player Latrell Sprewell claimed that a few-million-dollar-contract is not enough to feed his family. This is joke #1 I have ever heard of about compensation.

    Now the "His bonus has typically gone to basic lifestyle maintenance" is going to be #2.

  40. Guess what I did with my bonus?
    I put 70% of it in a 6months 3% CD.

    now there's an idea.

  41. "For example, 700 Merrill Lynch employees divided $3.6 billion in bonuses, for an average of more than $5.1 million each, even though the brokerage firm lost $27 billion last year."

    Since every one of these people ---- right down to the secretaries --- had substantial salaries, whatever happened to the gratitude felt by simply being employed, like all the rest of us??

    Bonuses split from BILLIONS??

    If Merrill & the rest of Wall Street had that much left over to divvy up, doesn't it imply that the fees these bastards have been charging us are beyond excessive?

    What an arrogant sense of entitlement!!

  42. Do these folks realize why average workers might have little sypathy for someone not getting a $145,000 bonus? Median houshold income is roughly 1/3 this guy's BONUS. And because of policies promoted by folks just lie this median income has not budged in a decade. Most people are wondering how they are going to buy food, not lamenting not being able to buy luzury items with a bonus. So boohoo. Spread that 145k to 50 families and it will make a big difference to them and do more than stimulate luxury markets.

  43. Poor Guy - I wish I earned 130K per year. I'd be living like a Queen and able to SAVE FOR RETIREMENT.

  44. Let's see....who regularly plans to go to a Ferrari dealership in their average year anyhow? Is this what we have come to expect from the average American? I think not. Where are the bonuses for America's teachers? How about the students with massive loans to pay off, just coming out of school.

    In today's economy we should be worrying more about those whose livelihoods are in jeopardy and not whether someone can afford to buy a new sports car.

  45. The only folks I can think of that deserve a 143K annual bonus are in Iraq & Afghanistan.

  46. And while were at it, lets not forget about all the new-poor headhunters, real estate agents, and various other deal-makers suffering out there, yikes - what a downturn this is! ...using the wine bottle index, I'm down to $10-12 bucks from a 2007 high of $40-50

    OK is the new great!

  47. Some people may no longer be able to buy a big screen TV or a saxophone? How will they cope?

  48. Wow, I have a really difficult time feeling any sympathy for these people. Bonuses should be based on success, and if you and your company are not making money, that is not success. I'm college educated and live very happily on 70,000 in New York City. Sure, I'd love to make more money, but right now I'm just exceedingly happy to have a stable job, because millions of us suddenly do not.

  49. Part of "globalization" is the reversion of wages to the norm. Did US think it would be exempt? Till your gardens, the days of peas and rice have returned. "meatless Tuesdays"? Try meatless months

  50. Excuse me for not feeling sorry for people like Anthony Abraham from Chicago. I work two full time jobs, make less than 75 grand between both jobs, absolutely no pension, and the only benefit is get is half of my health insurance paid. The only bonus I ever got was $100 cash at a Christmas party about five years ago from one of my jobs.

    I consider myself lucky. At least I can pay my bills however if I lose one of my jobs things are going to get a lot tougher.

    Anthony needs to get real!

  51. Waaah! He's not getting his $50K bonus. Waah! He can't buy a new car! Waah! He can't go to Paris for vacation! This is a story where 0.001% of people can relate to. And why is he still paying off his student loans after receiving a $140K bonus?

  52. I live in a one bedroom apartment, drive a 1999 Jetta that may be falling apart, and earn less than a quarter a year than this fellow's bonus. All of my income goes to basic necessities like food, shelter and medical co-pays; the only entertainment I spend on are sensible meals out (no more than about $15-20 per person), my dog, cable, and internet. I lost 25% of my retirement over the past year. My parents are nearing retirement age, and I haven't had the talk with them about how they're going to manage after putting my brother and I through school, especially now that their house, which was completely paid for thank God for small favors, is totally worthless.

    Am I supposed to feel sorry for this guy?

  53. Much as we love to instinctively criticize Reagan's 'trickle-down' economics, the inconvenient truth is that spending by people with money does create jobs that we may not notice in good times but disappear noticeably in hard times. Architects, interior designers, florists, artists, hotels, car dealers, delivery people, retail stores of all kinds suffer when people stop spending money. Consumer spending was excessive but many jobs were created through that spending and the adjustment to a more scaled back life, particularly by people who had much and spent freely, does affect everyone.

  54. Mr. Abraham should try getting a Federal civil service job. I make $120,000, after 20 years and with 3 degrees. Last year top bonuses were $1,750. This year no bonuses and they even canceled the award ceremony, no pewter cup to mark my 20 years with the government. Did these people do no planning?

  55. I do not fault the people in the article for complaining. Like many other Americans they simply do not know any better and come off as slightly uninformed and out of touch with the reality of life in these times.

    The Times managed to pick out two people who do not engender a single bit of sympathy.

  56. AnnS said it all. I could not work up any sympathy for either of the two people you profiled in this article.

  57. It is very difficult to feel any sympathy for the people discussed in this story. They are living very well and seem to be using their "bonuses" mostly for luxuries.

    One other thing. The article says that the businesses where the bonuses would be spent suffer. There seems to be some sort of idea here that the money paid in bonuses does not exist if it is not used for this purpose. The money will go somewhere else in the corporation and will be spent for something else, or by someone else at restaurants and the like. The money does not leave the economy.

  58. this article is a bit of a slap in the face to anyone making a typical working-class income, irrespective of the conditions of the national economic climate. i might have thought that the new york times had more important issues to which to devote its print space and resources than dolling sympathy out to people while providing them a rather vulgar opportunity flaunt their material excesses to the world.

  59. The next time I go to Walmart, I'll buy myself a box of generic kleenex so I can dry the tears of sympathy for those poor folk whose bonuses are larger than my annual salary.

  60. Gee, I wish I was as unfortunate as these fellows to have jobs in the $100,000-plus bracket.

    Call me cold and unfeeling, but I'm having a difficult time sympathising with two blokes who can't seem to manage their finances sensibly, and sound as if they are complaining about their base salaries.

    Wait; let me guess - they don't like paying taxes, either!

  61. My only comment on someone sad bcause they don't any longer get $147,000 bonuses is: poor thing!

  62. Seriously. Any article that contains the word 'bonus' or lack thereof and tries to evoke concern or sympathy from the reader is in a no win situation. Mr. Klincewicz, in your photo, doesn't exactly seem too stressed as he displays his toys all around him.

  63. After paying into Social Security for 45 years, my wife and I received a rise, 21 dollars for my wife and 37 dollars for me. You will please excuse me if I do not feel like commenting on the above bonuses. Thank you.

  64. A $400,000 automobile is ALWAYS politically incorrect.

  65. Six-figure salaries (or six-fiure bonuses) but this
    year ... NO BONUS! ohmigod. Cry me a river. Is it so
    hard to find people with real problems?

  66. Incentive pay and pay for performance schemes need to be seriously re-evaluated as a performance management tool. Clearly, as the article demonstrates, performance pay has become part of the basic pay package with an expectation that it will simply be paid out year after year regardless of performance. Given that the awarding of performance pay is a purely subjective exercise, it's not surprising to see the executive compensation abuses that give the holy grail of compensation systems (pay for performance) a bad name. A book on the Enron debacle outlined how bonuses are not linked to performance. A executive in the finance department restructured all of Enron's liability insurance policies but never was deemed worthy of getting a performance bonus. Years later when the house of cards fell, the only thing preventing the board of directors from being sued by shareholders was the liability insurances negotiated by the executive. Sometimes really good work just isn't reflected in year over year profits.

  67. Seriously?

    These guys earn over 100K a year before their bonuses. I'd like to introduce them to some of the people I've worked with, like the single mother with two kids whose welfare was suspended because she starting earning more than $400 a month are her fast food job. How about the immigrants earning $10 an hour who still manage to send 1/3 of their paycheck home to their families?

    I'm seeing more and more of these articles from the New York Times. Are these the kind of human interest stories that are supposed to evoke sympathy? If so, I'm just not feeling it.

  68. The issue is larger than a bonus, incentive, year ender and other perks.

    The issue is that 95% of Americans who also worked hard all their lives will never get any year end bonus nor relatively low expense medical care insurance, or a solid, secure retirement.

    The expectation of getting a bonus when that is corporate policy is really an expression of arrogance and entitlement that no Medicare, Social Security, Social Services, unemployment or other so-called entitlement recipient or average Main Streeter American could equal.

    The payment of bonuses is a simple transfer or redistribution of wealth from the many to the few, within the corporation and within our society.

    I remember on owner of a company stating that the company could not afford to continue medical insurance at no cost to the employees. This was followed by a statement that the company could not afford to carry on its books liability for a defined benefit retirement plan. The costs of both fringe benefits were conveniently shifted to the employees.

    When the company was sold for over one billion dollars the top executives walked away with millions, the owner with over $500 million and the employees who built the company were told that new corporate policy was 5% would be fired every year because in any company there were always %5 who deserved to be fired. Needless to say, no one at the top was fired except, as with all other employees, they had been around too long and were drawing top salary.

    All these anti-social, unfair, undemocratic, anti-worker and immoral actions were done in the name of competition, entrepreneurualism, free market and deregulation.

    Oh, and by the way, the company's original years of grwoth were protected by state regulation and law and although the company started and continued with a large union base, employees were told if they even mentioned the word for themselves, they were history.

    Yup. All power to those in power. All riches deserved or not to the rich. All power to the impotent!

  69. Oh yeah, my heart is bleeding for them. Get a grip.

  70. On behalf of the millions of minimum wage laborers in America including migrant farm workers, fast food chain workers, store clerks and those who clean the homes of people like Mr. Poor Me No Bonus, we say, "SO WHAT?" I am disgusted with the Times' recent articles about privileged whiners being unable to sustain obscenely bloated salaries, benefits, or bonuses while so many of us barely survive paycheck to paycheck - if we are lucky enough to have jobs. This man's "bonus" alone equals the annual wages of TEN full-time Burger King employees. Do some articles on what life is like for them instead!

  71. Let me get this straight...

    One guy had the debt of a student loan but thought he could afford Paris and a new car?

    And the other guy needed a 65-inch TV for his 5-bedroom house?

    Someone at the Times got the wrong end of the stick on this sad story.

  72. We never plan on my husband getting a bonus (I get one but it is pretty paltry compare to his) and it is never used as part of our daily household maintenance. In the past we paid off student debt and the likes. Those things have been put to bed so we now use it for: annual home improvements, paying forward on our mortgage, some for fun, some into our toddler's college fund, some goes to charities, some for vacation and some to a rainy day fund. We get the money and we plan out how we will spend it. Some years we get to do more things than others. But you are foolish and a fool, if you live a life that requires that you get so much in bonus.

  73. I'm not sure what the tone of this article is. That we're supposed to feel sorry for someone who can't afford a Ferrari? The base salary of most of these people is quite good. Or maybe it's that this is an unintended offshoot of the stimulus plan which is bad for the economy because people now have to stop buying 62" TVs? Yet another jab by the press at the stimulus package. This is a very strange article.

  74. I am perplexed why those individuals cited in the article who sell things rather than make things are compensated at such high levels. Logic dictates that if a product produces a profit for the manufacturer the individuals who actually made the product should receive the extra compensation. After all, we can do away with the middle man/woman who is just an unnecessay front for the product.

  75. Trying to make feel sorry for those who can no longer live in excess? Go look for another violin...

  76. $135,000. is more than 75% of the workers in the US earn in a year. If he failed to save for down economic times, that is his fault. Let him spend his time blowing his sax.

  77. They cannot live on $100.000?????

    Let me get out my little violin.

    I agree with AnnS.

  78. The ongoing chatter about bonuses and how people have come to count on them as earned income is just one more symptom of an economy built on phantom numbers. 401ks and the stock market is a good bet for your retirement funds. Real estate never depreciates, so go ahead and spend the equity of price inflation. Banks are fiscally responsible, mortgages never come due, bonuses are an ordained right and tomorrow is another day.

    Well, tomorrow is here and your bonus isn't, because just like those market profits and that home equity, it was never really yours to begin with. For every story like this, you could write one about people who didn't spend the last 20 years living in fantasy land. Please don't ask or expect the latter to sympathize. I'm already busy bailing out some of the former.

  79. Are you kidding? This guy needs a bonus on top of his $135,000 salary just for "maintenance", what is he trying to maintain? Somebody needs to teach these guys about what the rest of the US is going through. Its called budgeting, and it doesn't include trips to Paris. The coverage of the economic crisis continues to be mildly insulting.

  80. A bonus is defined as "a payment or gift added to what is usual or expected."

    If you are counting on your "bonus" to make vital payments AFTER a reasonable sized salary (and $135,000 a year base pay is MORE than enough to get by), you are not budgeting correctly.

    These are tough times; people are without food, housing, health care. Never mind trips to Paris for the time being. I have trouble sympathizing with those that learned to live in excess, and are unable to compensate when life does not meet their absurd expectations.

  81. Why has the Times gotten into the dismaying habit of asking me to feel sorry for people who earn several multiples of my own income? Are these articles about fat cats boo-hooing about their lost Ferraris meant to generate schadenfreude, or envy? If the former, they do a poor job of it. This is junk journalism. The crisis has greater implications than flatscreen TVs. This is like reading about someone who escaped the killings fields in Cambodia griping that they chipped a fingernail as they boarded a chartered helicopter to get away.

  82. I work for a social service agency that helps people who struggle to survive in the best of economic times. From this perspective I have a hard time feeling much sympathy for people who claim economic hardship because they have to give up their $400,000 cars or delay a trip to Paris. Perhaps the people featured in the article could use the opportunity of a reduced bonus to reflect on the billions of people world wide who live in abject poverty and can only dream of having such “problems.”

  83. Welcome to the real world, Anthony! $135,000 base and $50k in bonuses. I do not feel sorry for you at all. Sorry no new car this year and you're not going to Paris.

    I've worked hard all my life and make less that your bonus. Welcome to the real world.

  84. I'm sooo sorry little Anthony won't be buying a new car or going to Paris this year. Does this also mean he'll have to go to a food bank to eat, or is he losing his house? Maybe Jan Klincewicz, can take his baritone saxophone down to the local bus station and play for spare change to make up for his lost bonus. The sense of entitlement is unbelievable.

  85. What's "normal"? If most folks in the USA are pulling down $100k+ salaries and accustomed to a bonus on top of that - a bonus that frees all of us to travel, buy lots of things, etc., then why did we need a change in the last election? People making lots of money (most Americans, it would seem), just don't need a change, do they?

  86. Despite the fact that my contract runs out at the end of the summer and despite the fact that my entire salary (and I have a masters degree) is less than the $50,000 bonus that was referenced in the article, I have felt relatively blessed over the past few months because I know that it is tremendously more difficult for so many others. What is disturbing is that we have become accustomed to an economy and way of life that is based in these kind of structures that allow and even encourage such ridiculous bonuses, not to mention the disgusting inequalities between the rich and the poor. It is going to be painful to readjust, but we have to do it and get to a new place with greater equity.

  87. For a moment I thought I was reading The Onion and not The Times. C'mon! When will The Times take up a collection to help Bill Gates and Warren Buffett. Guys, stick to your knitting and stop doing satire. These overindulgents don't need anyone's sympathy, especially from The Times.

  88. A bonus is just that-- something extra if things go well. If it were meant to be something people depended on year after year, it would be called a salary. The argument that people have come to depend on their bonus to support their life style, or have taken on debt that depends on their bonus to meet their repayment schedule is simply an indication of bad financial management. Every business includes a safe harbor clause in their financial results: past performance is not an indicator of future returns. The English translation of that is "next year may not look like last year, so plan accordingly".

    If people choose to live with higher risk, they're welcome to, of course, but I'm not accepting the "people don't understand that bonuses are really an expected part of our annual income" line...

  89. Coverage like this is just sad. Normally I love NYT articles about finance, but this one is both poorly conceived and poorly executed. Does Mr. Richtel really expect those of us living on 20-50k a year to feel bad for slightly diminished (though still smug smile) of Anthony or anyone making 3- to 5-times our salary? Mr. Richtel I challenge you to do you job and instead of reporting on the plump and comfortable - get out of NY and Chicago - do some research and reporting on the other 80% of our country.

    And to Anthony - well gosh I guess Paris will have to wait, but don't feel too bad my parents worked their entire lives (a school teacher and a state employee incidentally) and never had the money to go. Both you and Mr. Richtel should be ashamed for making these kinds of complaints now or any other time.

  90. $143,000 bonus? We're struggling tp pay for insulin and supplies for my two children with type-1 diabetes on a median income, and there's no money to send the oldest to college. I'm not looking for a handout. Just fair play would suffice.

  91. A trip to Paris is "basic lifestyle maintenance"?

  92. Perhaps Mr. Klincewicz should consider trading his baritone sax for a very small violin. Oh how I weep for the affluent trying to maintain their basic lifestyle.

  93. Absolute rubbish. Try paying your student loan with a minimum wage job. Take your money and shut up.

  94. How come the NYTimes is so hard pressed to find regular people to cover in their economic coverage? First a story about how hard it is to live in New York on $500,000 a year, and now this. I don't know anyone who's gotten such an astronomical bonus, nor do I know anyone who considers a fancy vacation or a lavish house a "necessity." The Times is symptomatic of all that's been troubling our excess-oriented economy in the first place.

  95. The people portrayed in your story are not representative of most working class Americans.

  96. The examples given in this article, while not the obscene bonuses freely passed out to the Wall Street thieves, are stunning nonetheless. And the fact that their recipients are feeling the pinch now speak to a lavish culture of overspending. Before I was laid off, my salary from a 30-year career in journalism topped out at $87,000 annually supporting a family of four. The last and best Christmas bonus I ever received was a $50 grocery card, which of course did nothing to dent our $850 mortgage payment and the rest of our bills -- one auto payment (the 2nd car is 9 years old and owned free and clear), 401K contributions, $6,000 in paycheck deductions for health insurance, electric bills, auto and home insurance, food, cable, clothes, gas, fees for school and kids' activities, doctor co-payments, etc., and numerous other incidental expenses I can't even cite off the top of my head. And I was considered highly paid in our 20,000-circulation daily newspaper newsroom, while working 50 to 60 hours a week for years (no time for a second job, and my wife only worked part time so she could raise our children). We did manage to take two modest vacations per year (never did Europe), because we considered this family and relaxation time imperative. But even they had been shrinking in recent years.

    Had I ever been lucky enough to receive a $143,000 bonus on top of my regular salary, even just once, you can bet two thirds of that money would have gone into the 401K and college funds, while the rest would have been used to pay off the car, get way ahead on the mortgage, pay off any monthly credit card balance and fix up the house. If there was anything left after that, my wife and I would probably have felt justified to indulge in some luxury item, perhaps a larger TV, and I don't think that would have been out of line. The point is, a huge windfall like that would have made our current cash-flow lives easier for at least a couple of years while helping assure our solvency in retirement and the college education of our kids.

    I didn't go into journalism to get rich, certainly. But I'm sure my contribution to society was every bit as important and valuable as those of the gentlemen cited in this article. If they're feeling pinched now, they have only themselves to blame for living too high on the hog for too long. And if the companies that employ them are feeling pinched, well, it's easy to see why.

    Can anyone imagine what they'd do with a $5 million bonus? That would be like winning the lottery. Whose toil could possibly be worth that much relative to that of other hardworking folks who will never see that kind of money except in their dreams?

  97. So someone receives a big enough bonus to buy a house, a big screen TV and a saxaphone. Huh? Well I've NEVER received a bonus in my life from any job. And for him to receive one that is almost 3 times my annual salary....well I don't feel sorry for these fat cats. I'd be ever so happy if I could receive a $1k bonus from my job. As it is I'm just looking forward to my $700 tax refund check. These people make me sick.

  98. As a retired social worker who in a long career in child welfare never made more than $60,000 per year, it's hard for me to have any empathy for people described in this article. Large screen televisions and trips to Paris? There's something wacky about priorities here in the US and how different kinds of work are valued.
    I'm not complaining about my own situation. My husband and I live frugally. We've been to France a number of times. We have no debt. We're content to watch television on a small screen and we're happy with our lives.
    It will be character building for some of these high fliers to learn what it's like for regular folks in this country.

  99. I am getting sick of these articles featuring people who make more in bonuses than most people make in three years.

  100. Let me find my violin....

  101. So on a $160,000 compensation ($135,000 base plus reduced $25,000 bonus)the man can't survive. Cry me a river.

  102. Who are these people? It's just comical that I could be expected to relate to pains of their huge lost bonuses.

    I make in the upper $90s and support a family of 5 and I consider myself to be very lucky. And I can relate to others losing their base pay, especially when it effects their ability to cover necessities. But a trip to Paris? Having to sell the Bently?

    Look, I like having nice things and family vacations but where do these people think their bonuses come from? These amounts are egregious and can't possibly be a fair trade for the amount of work they did. I see plenty of people struggling daily under backbreaking conditions who are educated and hardworking and who are paid fairly for their production without such extravagant bonuses.

    We'd all love free money if it grew on trees. But then were would the value in money be? How about a return to a more fair vs. work system?

  103. This story is an absolute joke. Front page to boot. The writer is either incredibly deadpan or out of touch with 99% of the country.

  104. $143K and I'm supposed to feel...what? I could care less, hey Times go out and talk to the folks like me who wonder if next paying next month's rent is going to happen or not, if I'll have money for non-Top Ramen food, or if I can pay at least one utility. Get (expletive deleted)real.

  105. Some of us manage to live quite nicely on a fraction of Jan's $143K bonus - granted I don't have a saxophone - but I'll live.

  106. Bonus has strongly been missused for some time both by employers and employees. It is not a a regular income. It is something extra. But if this extra is exceeding the level of salaries, and suddenly there is no room for a bonus, you are in trouble. A lot of people will be in deep trouble now. Bonus shall not be take for granted as it has been for some time. The bonus system today belongs to dirty tricks department.

  107. You know what? Boo hoo.

    We don't do much. We don't go on many vacations at all, but guess what. We don't have debt and we are not hurting now. I do feel sorry for some folks, but not this guy.

  108. It kills me to read about these poor souls who make over $100K who didn't get their $50K+ bonuses when I make under $100K and didn't get my meager $5K one at the end of 2008. They get no sympathy here. Absolutely none. Whatsoever.

  109. I swear the NYT writes articles like this to enrage the rest of us. At least once a week the Times has an article showing how people are surviving the recession: firing their nannies, living off of only 100k a year... We're educated white collar middle class in Baltimore and there are several foreclosed houses around my house. I'm scared my neighborhood will fall to pieces, that we'll lose our jobs. How the heck do you expect us to feel about some guy who can't go to Paris this year? I realize wealthy people read your paper too, but try and have some sense of reality that the 90% of us live in.

  110. I was going to write something long and snarky, but I think these stories are great because they serve to show us what we become. Are we really happy with what we see in the mirror?

  111. OK, so I live in Houston, make 64K/year for a family of 4 (no bonus) - we are comfortable, but there are plenty of people who would look on in envy at my situation. A vacation means a day trip to Austin, cars are 7-10 years old (and paid for). These upper-middle class clowns don't exactly have me crying in my (cheap) beer. For the fact that they can still feed, clothe and shelter themselves they should thank their lucky stars.

  112. Sorry, there will be no violins. Mr. Abraham's 'base' salary is twice as much as most American's make. Welcome to the real world and see you in Wal-Mart.

  113. Don't you just hate it when you have to cancel that trip to Paris?

  114. This article seems to be an irresponsible apologia for the culture of bonuses. The bonuses that were issued in recent years were the results of unsustainable short-term profits derived from many investment shell games. It's sad that Matt Richtel seems to condone a culture of bonuses-even when the companies giving them have undermined the economic stability of this country. It's been said again and again, few Americans object to bonuses truly earned, but no one contributing to the ruin of a company or economy deserves them.

  115. Another provocative Times piece. It's seems the Times doesn't know anyone making $25k to $65k, even though that covers about 85 percent of the nation's households. The folks profiled here all make multiples of what an ordinary worker earns, even before their bonuses. No salesman taking home $123k a year ought to be worrying, and no 33-year old making more than $100k ought to have any trouble paying school loans. Dude, your first bonus should have retired your debts.

  116. How many Americans have lost their jobs and homes in this economic cataclysmic mess and the New York Times is profiling someone who is losing a bonus and has to scale back "to help pay for cars, trips, home renovations, and school tuitions and summer camp for their children." Astounding.

  117. An employee should receive competitive fair pay for work preformed. Extra compensation should be shared by all employees not a privileged few. The company promotes the bonus system as an incentive to go above and beyond than what is expected from the employee but is accomplishes the opposite.
    The problem is which group is eligible? Exempt, professional employees receive most of the bonuses. The great majority of non-exempt employees are not eligible for the extra compensation. However, without their daily work contributions the privileged group would not receive a bonus.
    The system reeks of fraud and discriminatory practices. Most of the bonuses are distributed to males because they are the ones that don’t have to rush home to pick up their kids from daycare. The males the “midnight oil” along with single females to perform the extra work that will reward them with a bonus.
    The irony is that bonuses are supposed to motivate employees it discourages those that cannot participate and opens the door for fraudulent accomplishments by those eligible to receive the extra compensation. We have witnessed this behavior, throughout this economic meltdown, displayed by the bank and mortgage employees and executives.
    Companies must review their pay guidelines and design a system inclusive of all employees that rewards honest work and accomplishments.

  118. I have to agree with AnnS on this story. The people in this article are crying over losing bonuses that are more than the average US salary, or even double that average salary. Really??? I have never once in my lifetime received a bonus. I have worked very hard for every penny - and in comparison to these 'sob stories' they really are pennies. This makes you wonder, has the NYT lost its bearings on this one??

  119. Since the average income, in the US, is $42,028, and the average, in the somewhat depressed City of Schenectady,
    is only $38,676, it real hard to feel any sympathy, for a fat cat who still makes 5 times that, even after his bonus is halved. Get Real, people!

  120. How about a little "Yankee thrift?"

    Earn a comfortable living, spend less than one earns, and save/ invest the difference. Simple concept. But, difficult for some to execute.

    Here is a "poster man" that exemplifies why our country is having these economic problems.

    A 33 year old mgt consultant uses his bonus to support his basic lifestyle maintenance. He uses it as though it is a normal part of his income and not a bonus (that could be used to build his personal wealth). I always consider a bonus as "extra" ...for above and beyond the normal performance and for use for "extras" I would not normally purchase. How about making the student loan disappear? Or build a cash reserve? Or increase one's investment cushion? Add to an IRA? Instead of paying off his student loans, it appears he planned on using his bonus to pay for a Paris trip and to purchase a new car....and make a "payment" towards his student loan...and not using the bonus $ to pay it off or pay a large chunk of it off.

    What part of the "I choose to transfer my income to someone else so they can become wealthy at my foolish expense" doesn't he understand? Did he sleep through arithmetic and the lessons of "compound interest" and "deferred gratification?" One doesn't need a college education to save money, build wealth, and enjoy financial independence. Doesn't this fellow apply some of his business training to his own situation? After all, as we manage our personal finances, we are really running a "small business."

    While I'm a little over the top about having or not having debt (an affectation of my childhood training by depression era parents), debt restricts one's choices and transfers one's personal wealth to someone else...whether it be a credit card, mortgage, car loan,trip to Paris, or T-bills sold to China. As this fellow is a high paid managment consultant (and presumably "smart"), why is he not paying himself first? If one can't manage their own affairs sensibly, how can they presume to give advice to others? I wonder if he has an "underwater" mortgage or just has one that receives minimum payments? Or maybe, he "can't save money or afford a mortgage."

    Call me Anthony, I'll show you how you can build wealth & financial security.

    ---observations from a thrifty Yankee

  121. $108,000 per year and a $24,000 bonus? My heart bleeds for you. It is going to be really difficult to add that solid gold slide trombone to your band.

  122. My heart goes out to all those poor souls who slave away yet cannot buy new saxophones, televisions and trips to Paris this year. I don't live in NYC anymore but when I did bonuses were skipped regularly with no real explanation. We didn't count on them - they were never contractual compensation. America is a country full of entitled slobs. Far too many Americans lack the grace or even sense to look at what's happening and realize the broader implications — ie: the person in front of you at the grocery store who is paying with food stamps.

    Explain to me why economic recovery should start with lining the pockets of greedy pigs and not people who truly need a break in life. They are forgoing more than European vacations.

  123. I really think that however widespread the use of bonuses is or was in this country, there remains a signal difference between what most people get--and the obscenely outsized bonuses--and overall compensation that a favored--or perhaps just well-connected--few have been getting.

    The fundamental truth is that some people have been raking more in, in the way of compensation, than there is any economic or performance justification--in which plutocrats have justified their bloated salaries and bonuses on the basis that those sums are what the other plutocrats are making. And they have pushed the bar ever higher--by threatening to leave and join some other organization.

    No where was this farce brought into sharper relief than last December--when Wall Street-on the heels of its second-worst 10-year performance EVER--proceeded to hand out bonuses that totaled up to the sixth biggest bonus pool ever.

    When called upon by an outraged populace to defend such extravagance in the face of such a dismal performance--the bleating response was twofold: they had to give the bonuses in order to keep their "best" people from leaving; and those "best" people really depend upon those bonuses--as part of their total compensation.

    I think Andrew Cuomo, the A.G. of New York, said it best:

    “‘Performance bonus’ for many of the C.E.O.’s is an oxymoron. I would tell them:

    a) you don’t deserve a bonus;

    b) where are you going to go? and;

    c) if you want to go, go.”

    Seriously--can anyone out there offer me a cogent argument for the societal and economic benefit of any one person being a "billionaire"? Or put forth a set of statistics showing a measurable leap in performance produced by adding zeros to somebody's bonus check?

  124. I am having difficulty feeling any sympathy for these folks. I live on less than $25,000 and have a rich life full of work I love, friends and family who are there for me, a home in a lovely neighborhood with kind and supportive neighbors. While I don't make it to Paris, Lake Michigan works for me. I've never bought a new car but am delighted when I find a low mileage, gently used, American auto that I nurse through as many years as possible. I think a little perspective and gratitude is needed here. I mean please...suffering on $135,000 a year.
    I believe these men need to meet some REAL poor folks and take some lessons on how to live fully within your means.

  125. At the risk of sounding "mean", I find it extremely difficult to feel sorry for anyone making a six- or seven- figure salary because they aren't going to get a bonus. Deal with it! There are those of us who make, if we're lucky, a mid FIVE-figure salary who have figured out how to survive in NYC. Admittedly, trips to Europe, luxury cars, expensive homes and every other manner of luxury is a nice perk, but none of this is by any means REQUIRED to live a decent life.

    I work in the financial industry, and I have watched folks in the highest-paid positions in my company receive bonuses this year, even if smaller than last year's, while those of us in "staff" positions will not even receive a miserly cost of living increase. Do you seriously expect us to feel sorry because you can't make it on a few hundred thousand a year? Perhaps a taste of a little less indulgement will help you gain humility and thankfulness for what you DO have. Grow Up!