There’s been a lot of controversy over the $450 million (total) bailout of AIG. They’re not the only pigs at the taxpayer-funded trough, but their feckless arrogance at giving bonuses to incompetent CEOs responsible for its nosedive into default, and the subsequent payoffs to overseas banks, has really pissed off already fed-up taxpayers.
Some brain-dead people even thought putting them back in charge to “straighten out the mess” was a good idea. Why? So they can screw up again? To be fair, I’m angry at both AIG and the politicians who gave AIG the money to skate right out of its irresponsible mistakes.
This whole economic crisis was a train wreck just waiting to happen. Politicians mandated that banks make loans to people least likely to repay them, and used OUR money to bail them out. To top it off, the government loaned money to corporations that got into trouble by making bad business decisions, and bailed them out, too.
That’s why Congressional hearings are a joke. If anything, the rank and file taxpayers are the one’s who should be holding hearings on the Congressional and Senate assholes who approved the bailouts.
Elected officials, (Christopher Dodd in particular) helped write “contractual” loopholes, to ensure that AIG could use the money as they saw fit, with no stipulations. No wonder, since several members of Congress and Senate on both sides of the aisle, received donations from AIG.
For those who are just as angered for the same reasons, no explanation is necessary.
To people who make the excuse that AIG is simply “abiding by the terms of your contracts with your employees”, you’re dead wrong on this, and here’s why:
The bonuses, per se, are not the problem; it’s the source of the bonuses. It’s taxpayer anger over being forced to bail out FAILURES.
I’m a capitalist. If you profit through hard work, risk, perseverance, and smart business decisions, more power to you. Capitalism is supposed to reward SUCCESS. If you fail, don’t dig into my pocket for rescue. If these CEOs were being paid off with shareholder’s funds, I wouldn’t be angry.
Funny how those who disagree with forking over money to failures are being accused of having “wealth-envy”. Newsflash: I didn’t spend 30 years as a Soldier paying taxes on a salary equal to a Congressman’s lunchtab just to be accused of “wealth envy”. I knew the job was dangerous and underpaying when I took it. I didn’t expect to get rich, but by the same token, I didn’t expect to get accused of “wealth-envy” for objecting to obscene bailouts.
Like a wise person once said: “I don’t envy the rich or pity the poor”.
The socialists in power do have wealth envy and want to take even more from those who have and give to those who do not. They’re inflicting massive government interference in the economy, instead of allowing free enterprise to take its course.
That’s how a Socialist government works.
As for contractual obligations: Was it shareholder money? NO. Was it money that AIG had leftover from profits? NO. It’s ours. It was taken by the government against our will and given to a failed business in the name of “bailout”. I don’t give a damn about their contracts. Let them get sued. Let them go into bankruptcy like every other business that goes tits up.
It’s not just a bailout; it’s a lack of integrity and accountability. Even some state governors are turning down stimulus money because they know they will be forced to spend it on pork. AIG has no shame. But again, they’re just another pig at the trough.
A commenter on Neal Boortz’ site asked this question: “Are you angry with an athlete who signs a huge contract and then underperforms, yet still gets paid? Or an entertainer who makes a bomb of a movie and still gets paid? I’m not.”
I answered: Neither am I. Are they overpaid? You bet. BUT IT’S NOT MY TAX MONEY, EITHER. It’s money paid by owners and executives that put their own money at risk, NOT ME. Apples and oranges.
Given the fact that these CEOs are already making millions, and getting additional bonuses on top of that, disallowing money that didn’t come from AIG in the first place, wouldn’t put a dent in their lifestyle.
And just look at what AIG has done with OUR largess, under the guise of “contractual obligation”. Do those wild parties they threw come under the same contract?
These bonuses were guaranteed in a contract not agreed upon by those who foot the bill. We, the benefactors, did not sign the contract which the government is indirectly “honoring” with our money. I don’t recall MY signature being on any AIG contract. Under any other circumstances involving normal business transactions that would be illegal.
A legal example: My car insurance company was sued in a class action suit, and as a paying CONTRACTUAL customer directly involved in the financing of said company, (through premiums) I get a settlement. That’s fair, because I signed a contract with the company and I’m getting back some of MY OWN money. People not included in the contract are not liable.
Though we never agreed to a binding contract, we are being held liable by proxy, for AIG’s failure.
How is that legal?
AIG CEO Edward Liddy opined that these contract agreements were in place in 2007, before he took over.
I don’t care if the retention bonuses have been in place since 2007, that’s not what the bailout money was intended for. It was supposed to put AIG back in the black and prevent it from going into bankruptcy (where it belongs), not pay for bonuses. So, when all is said and done, AIG committed fraud. And, they’re still in the red.
Spread the wealth.
A commenter on TigerHawk’s website pointed this out:
I wasn’t sure what to make of Liddy until I read his Washington Post op-ed. Conclusion: he’s a self serving liar. On his one dollar compensation: from Financial Times, “Compensation for Mr Liddy, who took over the embattled firm as chief executive in September, consists entirely of stock grants in 2008 and 2009.
He will not receive an annual bonus for those two years but, depending on his performance, will be eligible for a special bonus in 2010.” (Link: http://www.ft.com/cms/s/0/1fa2351c-bb5c-11dd-bc6c-0000779fd18c.html?nclick_check=1)
On executive compensation he brags that bonuses were reduced by 56 percent from 2007 to 2008 without noting that AIG stock fell from 57 dollars to under two dollars in that time frame, that the 2007 bonuses were hugely inflated to begin with and that it was in 2008 that AIG almost went belly-up and needed the multi-billion fed bailouts.
At the end of the editorial he states that “The business unit that was the source of our greatest losses is being shut down” without closing the loop to say that that business unit is the very same Financial Products Group whose retention bonuses he defended earlier in the editorial.
This was a deliberate attempt to mislead.
Small points perhaps but points that are indicative of the dishonest nature of the op-ed and, I believe now, the man himself. Also note that it was Liddy who defended last year’s absurd 440,000 dollar luxury spa AIG executive retreat as “a standard industry practice.”
Expect more “contractual obligation” excuses to come up every time corporate heads are questioned about their own CEO ‘bailouts’, in lieu of rescuing their companies.
You’re not going to solve the problems of a company like AIG by throwing more money into the pit.
American taxpayers are sick of being gouged for pork barrel projects, a bloated welfare system, scientific “studies” on everything from the “climate change” hoax to the sex life of insects, and propping up failed corporations.
We’ve had it. WE want a bailout.