Fred Goodwin’s pension

The Heresiarch writes about Fred Goodwin’s pension:

Only a misery-guts, only the most mean-spirited, envy-ravaged spoilsport could possibly begrudge Sir Fred Goodwin his generous pension.

I guess that makes me a mean-spirited envy-ravaged spoilsport, then. Goodwin has utterly fucked the company he was running, leading to a loss of £24 billion — the largest in British corporate history. So he’s harmed RBS shareholders and because the company had to be bailed out by the government, he’s also cost the taxpayer plenty. Both the shareholders and the taxpayer deserve compensation from his incompetence, so not only should his pension be cancelled, he should have to repay any performance bonuses he has had.

But where I most disagree with the Heresiarch is this:

Of course Goodwin doesn’t “deserve” a pension of getting on for £700K at the age of fifty. But nor would anyone else.

A pension of £700k (note correct use of lower case) works out as about the same as a lump sum of £16 million. I contend that some workers are with that, specifically those workers who produce an added value of that or more. For example, an electrical engineer might design a way of making power stations 0.1% more efficient — if this was used worldwide, it would save about a billion quid a year. Or a musician might make music that gives pleasure to millions. Or an Internet startup might build a search engine that allows people to find information on websites more efficiently. All these people can be said to have produced more than £16 million of wealth, so it’s entirely reasonable if they are well rewarded.

How much wealth has Goodwin produced? About minus 24 billion. He’s produced negative wealth, so deserved to be paid a negative amount; he no more deserves to be rewarded than someone would do if they threw a brick through every window in the country, causing billions in damages.

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One Response to Fred Goodwin’s pension

  1. Pingback: Morals and Ethics and Carnal Forbearance - Scottish Roundup

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