In today’s installment of The Audacity of Greed, we bring you the story of Andrew Hall:

In a few weeks, the Treasury Department’s czar of executive pay will have to answer this $100 million question: Should Andrew J. Hall get his bonus?

Mr. Hall, the 58-year-old head of Phibro, a small commodities trading firm in Westport, Conn., is due for a nine-figure payday, his cut of profits from a characteristically aggressive year of bets in the oil market.

There is little doubt that Mr. Hall is owed the money under his contract. The problem is that his contract is with Citigroup which was saved with roughly $45 billion in taxpayer aid.

   What the article fails to question is this: is anyone worth $100 million? Paul Krugman partly answers the question:

The Times report suggests that he makes money mainly by outsmarting other investors, rather than by directing resources to where they’re needed. Again, it’s hard to see the social value of what he does.And there’s a good case that such activities are actually harmful.

For example, high-frequency trading probably degrades the stock market’s function, because it’s a kind of tax on investors who lack access to those superfast computers — which means that the money Goldman spends on those computers has a negative effect on national wealth. As the great Stanford economist Kenneth Arrow put it in 1973, speculation based on private information imposes a “double social loss”: it uses up resources and undermines markets.

   And concludes:

Neither the administration, nor our political system in general, is ready to face up to the fact that we’ve become a society in which the big bucks go to bad actors, a society that lavishly rewards those who make us poorer.

   I agree with the last point. But, I think Krugman avoids a more fundamental question: should anyone be paid $100 million even if the bucks go to "good" actors? I believe the answer is an emphatic no. This is one of the worst parts of our so-called "free market" system–the idea that the market will decide how to allocate rewards.

   The problem is that the the market is run by people, not some abstract entity. And the people who run the market decide that high compensation should go to a small group of people–because the people who decide that are, in fact, the people in that small group. That works out nicely, huh? It’s not some objective process–it’s highly subjective.

   And, so, then, even the "good" actors–I suppose those are people who don’t break the law and don’t tank the financial system–get outsized rewards. And the problem with that seems pretty obvious: what’s left on the table for the 99 percent of people who also contribute to "good" behavior? Not much. And that is the true issue here.