Gee, was it that long ago that those financial wizards were hanging their heads low for creating one of the greatest financial disasters in history? And didn't it seem like yesterday that they were meekly looking to lawyers to get them out of trouble? For a while there, lawyers seem to have the upper hand.
That didn't last long. As mega I-banking bonuses crept back, Wall Streeters started treating lawyers like dirt again. Goldman, Sachs--as you might know--just announced a compensation pool of $15.38 billion. And that's actually down 5 percent from the year before. But compared to the standard associate bonuses distributed by most big law firms this year ($35,000 tops), it's a no-brainer that I-bankers pity their lawyer counterparts.
In The Wall Street Journal, former I-banker Evan Newmark asks a question that seems to befuddle many bankers about the lawyers who toil on their deals--namely, why would anyone so smart opt for the low-paying job of being a servant to the titans of finance?
Why work at Cravath or Skadden Arps or S&C when you could work at Goldman Sachs? Why throw yourself into Wall Street’s ring knowing you’ll be stuck as a cornerman for the rest of your life?
Consider your career. Four years for your B.A. Three years for your law degree. Another six to eight years of 24/7 partnership-track servitude.
And after a dozen dreary years of study and apprenticeship, your likely reward is to take orders from arrogant 35-year-old Wall Street bankers for another decade or two.
It's a perennial question that many lawyers ask themselves. In 2007 I reported on how the proximity of Wall Street riches crippled lawyers--materially and psychologically (see "Rich Lawyer, Poor Lawyer"). One Am Law 100 partner lamented that lawyers were "just one step ahead of the doorman" compared to the bankers.
Cornerman, doorman--you get the drift. Newmark also calls lawyers "second-class citizens" and "well-paid functionar[ies]." And Newmark keeps rubbing it in: "You don’t negotiate the price of a merger between two CEOs. You don’t pledge billions in bank money for bridge loans or stapled finance. And you don’t get to schmooze at Davos with Tony Blair or Steve Schwarzman."
Not getting invited to the cool parties hurts, but then Newmark hits below the belt: "At least the bankers are honest with themselves. They’re in it for the money. . . . Wall Street’s lawyers aren’t all that different. They too are ruthless in negotiating fees for their services. They don’t walk away from clients because of some principled, high-falutin’ objection to a deal."
At this point, I really think Newmark is truly insulting. Sure, lawyers want to make money, and some will go to the mat to secure their fees--even when the amount is only in the tens of thousands of dollars (which must strike I-bankers as truly pathetic). But seriously, do lawyers hold a candle to bankers on the greed front? The answer, I think, is way too obvious.
In any case, should bankers gloat just because they are the higher-priced whores?
When the going was tough, bankers wanted lawyers to hold their hands. Now that they're living high on the hog again, bankers are dismissing lawyers as nerdy, gutless fools. Such arrogant ingrates.
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Photo: Courtesy of Wall Street/20th Century Fox