All the world’s a stage,
And all the men and women merely players;
They have their exits and their entrances,
And one man in his time plays many parts…
Last scene of all,
That ends this strange eventful history,
Is second childishness and mere oblivion,
Sans teeth, sans eyes, sans taste, sans everything.
William Shakespeare 1564-1616
There were plenty of actors reciting their lines and creating theatrics for the markets on Tuesday when news “broke” that The Northern Trust Bank had spent lavishly on a golf tournament in Los Angeles. The irksome part, I guess, is that the bank had accepted bank bailout funds.
No less than Maureen Dowd chimed in:
Talk about being teed off.
The economy is croaking and bankers are still partying at a golf tournament here on our dime.
It’s a good argument for nationalization, or better yet, internationalization. Outsource the jobs of these perfidious, oblivious bank executives to Bangalore; Bollywood bashes have to cost less than Hollywood ones.
The entertainment Web site TMZ broke the story Tuesday that Northern Trust of Chicago, which got $1.5 billion in bailout money and then laid off 450 workers, flew hundreds of clients and employees to Los Angeles last week and treated them to four days of posh hotel rooms, salmon and filet mignon dinners, music concerts, a PGA golf tournament at the Riviera Country Club with Mercedes shuttle rides and Tiffany swag bags.
Barney Frank and John Kerry were apoplectic:
“This behavior demonstrates extraordinary levels of irresponsibility and arrogance,” Frank wrote in a letter to Northern Trust’s chief executive. The letter was signed by 17 other Democrats on his House Financial Service Committee.
“I’m sick and tired of picking up the newspaper and reading about another idiotic abuse of taxpayer money, while our country is on the brink,” Kerry said in a statement after sending a letter to Treasury Secretary Timothy Geithner.
Similar concerns were expressed when AIG spent money on a lavish conference at a spa after being essentially “nationalized.”
I am no bank apologist. In fact, my position has been clear. Let them fail. No more dollars for bailouts.
But the problem here is not with the banks and their executives. Expecting them to act differently just because they’ve received taxpayer money to plug the holes created by greedy, selfish, incompetent, self-serving hubris is too much to ask. Banks, investment companies, large insurers and brokerages have been receiving government support in the form of laissez faire attitudes towards off-shore tax havens, weak accounting rules and accountants’ enforcement of mark-to-market, lax enforcement of antitrust provisions regarding double-dealing by ratings agencies, good-housekeeping seal approvals intended to lull investors into complacency provided by the government-sanctioned oligopoly called the Big 4 audit firms and various billion-dollar tax breaks for a while.
I no more trust the bankers to do the right thing with free, no-strings attached money than I trust my beloved, cupcake of a Rottweiler Rosie alone with my nieces and nephews. She can eat a remote control whole, batteries and all, and then lick my toes with a smile.
The problem is the bailouts. They were rushed in, with no conditions, expectations, controls or frameworks for monitoring. And we put the firms who were responsible for looking the other way while it was all happening in charge of developing the controls and monitoring.
What kind of a Twilight Zone are we living in?
Don’t take my word for it. Here’s Elizabeth Warren’s opinion.
Treasury Secretary Timothy Geithner, like his predecessor Henry Paulson, also has failed to articulate a clear strategy for the $700 billion rescue, said Elizabeth Warren, head of the Congressional Oversight Panel for the Troubled Asset Relief Program. The bailout is now called the Financial Stability Plan.
“These general frameworks do not provide an adequate foundation to oversee Treasury’s activities or to measure the success of the TARP or the Stability plan,” Warren, a Harvard Law professor, told the House Financial Services subcommittee on oversight today.
Ok, I promised you some Riviera Country Club scoop. I was chatting on Saturday with a friend who has it. The word about the sponsorship and its conflict with the bailout funds was already out on Saturday. But it took until TMZ.com, of all pubs, reported the info on Tuesday for the Congressional talking heads to start bloviating.
What he said:
Truthfully, this is, in my opinion, a huge joke.
I’m no fan of the banks, etc., but so far as I can see, Northern Trust is getting shafted here. First, not one media report I heard yesterday mentioned that this was a PGA Tour event (i.e. a well-known, high-profile promotional vehicle), instead simply saying that they “hosted a golf tournament” – as though it was some private getaway for executives. TMZ (I’m told) even made a big deal that participants were “being driven around in Mercedes” – those being being tourament courtesy cars that are provided free!
One might reasonably argue that given the state of things, the evening parties might have been curtailed a bit, but Northern Trust is trying hard to return the event to its former glory, spending LOTS of $$$ on promotion, upgrading the event’s temporary facilities, etc. The PGA Tour is an ideal marketing vehicle for them, and in my view, they did zero wrong here.
The LA Junior Chamber of Commerce (why “Junior?”) which runs it has been mailing it in for at least five years, partially (perhaps) because the previous sponsor, Nissan, had largely lost interest after moving their HQ to Tennessee. Historically, this was one of the two or three biggest events in golf (not counting the four Major championships) and Northern Trust seems intent on rebuilding that status with a larger purse, more advertising, more perks to attract elite players (read: Tiger), etc.
For all I know, they might be the biggest robber barons on earth. But in this particular instant, while a really shrewd mind might have scaled back the evening events for cosmetic reasons, they did nothing whatsoever out of line relative to any large professional golf event.
So far as I can see, they did NOTHING that every other sponsor of a PGA Tour stop doesn’t do – save for doing it on a slightly larger scale than many (but certainly not all) because they’re trying to rebuild the event, and because this is L.A.
This whole thing is ludicrous, and grossly unfair – and that’s coming from a Democrat who absolutely blames Wall Street. But NT is getting shafted here.
Barring any malfeasance as yet unreported, this is much ado about NOTHING.