They Don’t Want To Nationalize The Banks, But How About AIG?

8:57 pm EST March 15th, 2009 | News | 5 Comments

Because AIG is all about giving away our tax dollars to a bunch of rich-ass Cramer and Santelli types again and again and again with their bonuses. Only in the biggest of big business can a failed enterprise have the chutzpah to give bonuses to these scoundrels.

UPDATE: Sen. Russ Feingold is asking the treasury secretary how we can revoke these bonuses AIG is paying out with our money.

U.S. Senator Russ Feingold is urging the Obama administration to explore legal options to cancel $165 million in bonuses the American International Group (AIG) intends to pay its executives, despite receiving taxpayer-funded bailout money. In a letter to Treasury Secretary Timothy Geithner, Feingold requested to know what legal options have been explored for canceling the bonuses, recouping the money from the recipients, or suing the executives for breaching their fiduciary duties to AIG shareholders.

“As you know, the federal government has provided AIG with $170 billion in taxpayer money and currently owns 80% of the company,” Feingold wrote. “I share your outrage that a company which has been bailed out by the taxpayers for its mistakes would turn around and pay its executives such a staggering sum of money.”
Feingold, who voted against the Wall Street bailout, also questioned AIG’s defense of the bonuses. As reported in the New York Times, AIG’s government-appointed chairman, Edward Liddy, claimed in a letter to Geithner that the bonuses are needed because otherwise, AIG “…cannot attract and retain the best and the brightest talent to lead and staff the AIG businesses.”

“Since some of the recipients of these bonuses may have been responsible for the practices that drove the company to the brink of collapse – jeopardizing the financial system – I am sure many Americans will question whether they are indeed “the best and the brightest” and whether they deserve this level of taxpayer-subsidized compensation,” Feingold wrote.

If the White House is smart – both politically and practically, they’ll find a way to bring the hammer down on AIG.

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5 Responses to “They Don’t Want To Nationalize The Banks, But How About AIG?”

  1. Sean D. Martin says:
    March 15, 2009 at 9:25 pm

    I know, of course, nothing about the details of the contracts. But I’m extremely skeptical that they cannot be contested, particularly given the current state of affairs at AIG.

    Were these bonuses to be paid out regardless of circumstances? Were there no performance goals or other requirements that had to be met before the bonus was “earned”? It is near inconceivable that lawyers, who excel at picking things apart and re-interpreting what conditions must be met before an obligation has to be paid, couldn’t find any reason to refuse, or at least significantly reduce or delay, these bonuses.

  2. agilog says:
    March 15, 2009 at 9:51 pm

    if people are outraged, do something about it.

    protest aig offices.

    don’t let them get away with this comfortably and without consequences.

  3. revenantive says:
    March 15, 2009 at 11:27 pm

    This is, of course, all contrary to spirit of capitalism.

    AIG should have bitten the dust right along with Lehman Bros. Sure, there might have been catastrophic financial fallout, but isn’t this already a catastrophic situation? Terms like depression and phrases like ‘worst in 80 years’ don’t get bandied about among top level execs very often. Almost to a man, these idiots all subscribe to a completely phony optimist mindset.

    Walk into any major corporation or organization in this country…and who do you find running the show? It’s the 7 Habits of Successful People and the Who Stole My Cheese true-believer. This is the type of person who is getting these bonuses.

    The little guy who handles your AIG Auto Insurance barely makes $35k a year, but that guy won’t get much help. Unfortunately, after his bosses are finished raping and pillaging the company little guy busted his butt for, he’ll get a ticket to the unemployment line while his well compensated bosses will jet off to his off-shore tax shelter.

    After 40 years of conservative hegemony, this is what America stands for.

    Thanks for fucking over my country, you big money, big business bastards!

  4. Rheinhard says:
    March 16, 2009 at 12:20 am

    I am not sure whether I’ve posted this here before, but it’s important: I have a friend who lives a few blocks away who formerly worked in the insurance industry. He said it was well known among everybody in insurance that AIG was always the most reckless and systemically corrupt entity in the biz. They regularly encouraged their employees to ignore regulations, because the penalties owed for the transgression (if it was caught at all) were far less than the $ that could be made by doing the illegal action.

    AIG should be allowed to die, and its execs heads mounted on pikes up and down Wall Street as a warning to the next 10 generations not to pull this shit again (with apologies to Vir Cotto…)

  5. Duros62 says:
    March 17, 2009 at 3:09 pm

    If the government now owns 80% of the company, doesn’t that make the government a majority stockholder? Do we get no say at board meetings? Does the government have the muscle to disband the board of directors completely?
    Serious question.