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Read the Case Scenario Goldman Sachs is an expansive financial services company. Many clients are institutional:

Read the Case Scenario

Goldman Sachs is an expansive financial services company. Many clients are institutional: private companies and government organizations wanting to raise cash seek Goldman's help in packaging and then selling stock or bonds. On the other side, private investors—wealthy individuals wanting to multiply their riches—receive a hearty welcome at Goldman because they have the cash to purchase those stocks and bonds. Ultimately, Goldman Sachs is a hub where large companies, governmental powers, and wealthy people come and do business together. 

Executives at Goldman Sachs are among the world's highest paid. According to a New York Times article, "At the center of Goldman's lucrative compensation program is the partnership. Goldman's partners are its highest executives and its biggest stars. Yet while Goldman is required to report compensation for its top officers, it releases very little information about this broader group, remaining tightlipped about even basic information like who is currently a partner."  

The rest of the article investigates this shadowy partnership. The conclusions: "Goldman has almost 860 current and former partners. In the last 12 years, they have cashed out more than $20 billion in Goldman shares and currently hold more than $10 billion in Goldman stock." 

This tally of accumulated wealth in Goldman stock doesn't even include the standard salary and cash bonuses the partners receive, but leaving that aside, here's the math: $30 billion divided by 860 divided by 12 should give some sense of the wealth each of these corporate stars is accumulating over the course of a year. To give a provisional idea of how large the number of dollars is here, when you try plugging $30 billion into an iPhone calculator, you find the screen can't even hold a number that long. Using a different calculator yields this result: $2.9 million per partner every year. 

The 2.9 million can be compared with the salary earned by the average American: $50,000 a year. The Goldman partner gets that in less than a week. This huge money explains the clawing fight that goes on inside Goldman to become a partner. The odds are long. Each time the books are opened to admit a new class, only 1 of 330 Goldman employees makes the cut. It is, in the words of one former partner, "a very Darwinian, survival-of-the-fittest firm." 

In the public comments section of the New York Times story about Goldman, a person identified as GHP picks up on the firm's characterization as a "Darwinian, survival-of-the-fittest" place. He wrote, "The French revolution was also very Darwinian, let's give that a try." During the French Revolution, the wealthy and powerful were rewarded with a trip to the guillotine. 

Probably, GHP isn't just annoyed about how much money executives at Goldman make, he, like a lot of people, is peeved by the fact that the company was bailed out by the federal government during the 2008-09 financial crisis. Had the taxpayers (people making $50,000) not kicked in, Goldman might've gone bankrupt, and all that money its partners accumulated in stock would've vanished. As it happens, the US government's bailout was masterminded by US Treasury Secretary Henry Paulson. His previous job was CEO (and partner) at Goldman.

Source: Used from Creative Commons Attribution - NonCommercial ShareAlike 3.0 Unported license without attribution as requested by the work's original creator or licensor.

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