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March 18, 2009
Latest on the Bonus Sideshow
The BBC reported last night that the US Treasury Department will hold back the amount of the bonuses from the next round of bailout money to AIG.
Ailing insurer AIG will pay back the hugely controversial bonuses it awarded after taking public bail-out money, the US treasury secretary says.In a letter to congressmen, Timothy Geithner also said $165m (£116m) would be taken from $30bn the firm is due to get as part of its government bail-out.
While it will hopefully quell foolish suggestions to create highly targeted (and therefore highly illegal) income tax brackets of 100%, this resolution has not derailed today's AIG hearing before Congress, where relieved outrage has not abated
The remarks did not assuage the anger expressed by both Democrats and Republicans in response to the bonus payments to workers at AIG's financial products unit. Frank called the payouts "wholly unjustified," while other lawmakers took aim at the firm's management
and clever new names for the firm were presented.
"AIG now stands for arrogance, incompetence and greed," Rep. Paul Hodes, D- N.H., said.
Congressman, you've made it awfully tempting to fill in the acronym CONGRESS.
The real outrage, of course, is Congress placing AIG (and other private corporations) in a position to hand out tax dollars to begin with as part of a very expensive and highly quizzical effort to stop or shorten the fiscal slide created in 1995 by Congress itself, along with the Executive Branch. Every indignant word spoken at that hearing today to the hapless Mr. Liddy should be reserved instead by that congressperson for a quiet session with a mirror.
UPDATE
Question for Congressman Frank: in view of the death threats received by AIG management and employees, is it altogether prudent to be requesting the names of those who received bonuses?
UPDATE 2
And a follow up, sir. Will you also be requesting the names of those employees at Fannie and Freddie due to receive bonuses? [H/T Drudge.]
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Can't figure which is more embarrassing, a duplicitous Congress or the amateurish White House. I'm deeply embarrassed for my country as we witness this devious clownfest in Washington DC.
Posted by: Tim at March 18, 2009 7:01 PMWe are in deep deep trouble in this nation. We are without genuine leadership on either side of the aisle as we face daunting challenges both on the economic and national security front.
The founding fathers are turning over in their graves.
I would have preferred they got no taxpayer money at all. Same goes for Citibank, BofA, GM, Chrysler, etc. There would be far less long-term impact on the American people as a whole if they were just left to fail.
The dolts in congress, most of whom have never had to run a business or keep a real job, don't understand that in order to attract real talent, these firms have to offer contracts that are competitive in the industry. I'm not talking about the folks at the top who are ultimately responsible for the firms' performance, but the key middle to upper management people who keep things moving. They are like the vegetable vendor to the restaurant supplier who can't pay its bills. If the restaurant gets an influx of cash, they pay the vendors, a) to stay out of court, b) so they don't have to tell the customer, "sorry, no salad today sir". If AIG doesn't meet it's contractual obligations to its managers, they are free to take their talents elsewhere. Probably not something AIG, nor its customers can afford to have happen.
But I wonder, (not really), why the Big Three auto labor contracts aren't under the same viscious attacks? Since GM is running on taxpayer funds, should taxpayer money really be going to pay for the egregious salary and benefits negotiated by the UAW?
Hey, if were going to break contracts on behalf of the taxpayers, lets go to town on that!
Posted by: George at March 18, 2009 7:53 PM