The controversy over RBS CEO Stephen Hester's bonus had a lot of the digerati discussing the dark days of 2008. But few thought the British government would harken back to the dark days of 1621.
That year was the last time a knight of the realm was publicly degraded.
After failing to stem controversy about Hester's bonus (he caved and forwent it) the coalition decided to strip former RBS CEO (Sir) Fred Goodwin of his knighthood (since he already took his bonus).
Goodwin avoided the big public degradation faced by Francis Mitchell in the early 17th century, also for questionable business practices.
"Mitchell's degradation at Westminster Hall took the form of his spurs being broken and thrown away, his belt cut and his sword broken over his head. Finally, he was pronounced to be 'no longer a Knight but Knave'. After the ceremony, he was made to march through the streets to the Tower of London where he was imprisoned."
Goodwin, nicknamed Fred the Shred for his cost-cutting style, just has to stop using "Sir." But he also joins a Cambridge spy and Nicolae Ceausescu as losing the modern-day honor.
While the whole thing may seem antiquated, it is an interesting way to handle the anger against bankers, their compensation and their role in the subprime crisis. It's clear lots of people want some kind of comeuppance, but unlike the head of Tyco or the guys at Enron there's not a lot of evidence of a crime. There's no law against the incompetent getting paid and the recklessness of 2008 is an extension of the Wild West spirit of the U.S.
Unlike the U.K., the U.S. doesn't have any knighthoods to take away.
We are pretty good doing this with sports, though. Baseball, especially, is good at the roundabout punishment of people it thinks have somehow brought the game into disrepute.
So, along with an asterisk for every earnings record set during the TARP era, I suggest we open the Banking Hall of Fame.
First, find a small town like Cooperstown or Canton that has a tenuous folklore connection to the first bank in America. Then vote in the inaugural class (Alexander Hamilton, J.P. Morgan, Pete Rose's bookie). Have financial journalists vote on a class each year. And then just give the subprime era CEOs lifetime bans.
Justice and capitalism and sports all in one.
(Have an idea for a banking Hall of Famer? Tweet @TSTContinental.)
