You guys miss the point...AIG is insolvent...living on taxpayer dime. Liddy should never have promised bonuses using taxpayer money. It’s just plain wrong. You can not reward an employee based on how he/she is doing in one division or whatever if the company is failing...this is what got Wall Street in trouble in the first place. Plenty of failing companies shelled out big bucks in salaries and bonuses;many went under (Lehman) or were bought out (Wachovia, Bear ) leaving the stockholders to pay the price. You can not divorce compensation from how a company is doing...the whole company not just one unit or division.
“AIG is insolvent...living on taxpayer dime. Liddy should never have promised bonuses using taxpayer money.”
I realize that AIG is insolvent.
Was Liddy responsible for the retention bonuses?
Then they should have told the people last year that there wouldn't be any retention bonuses. That way nobody would have been working for a salary of $1 in the first place, and anyone who didn't feel he/she was compensated properly would have walked out the door MONTHS AGO.
You're missing the point. Those contracts were already in place at the time Liddy came onboard. They were legal contracts, lawful and binding. And now our government is treating them no better than trash.
That is a falsehood. The bonuses were promised prior to the infusion of government money. The bonuses were originally supposed to be paid from the profits made by selling off profitable segments of the newly dismantled company.
The falsehood is just another example of demagoguing on this issue.
The government had a choice: let AIG go under or arrange a bailout. They chose bailout. In order to make a bailout work, you need to keep the workforce. Hence the retention bonuses, which were duly approved in the original legislation, thanks to the efforts of Chwissy Dodd and Treasury officials, and enacted and signed. So, our stinkin taxpayer money is duly squandered (or not, if it was really vital to save AIG).
And the folks to get mad at are Congress and the President, not the AIG employees working to make the bailout as successful as they can. Congress and the President must not be allowed to welsh just because they now fear voter disapproval of the deal. Because, if they can screw these people, they can screw all of us.
It's worse than that, it was AIG Financial Products that tanked AIG, in 2008, under DeSantis, AIG FP lost 41 BILLION dollars. AIG 2008 10K Perhaps it wasn't the fault of DeSantis, but I am wondering what these guys did that was worth million-dollar bonuses.
MortMan:The bonuses were promised prior to the infusion of government money. The bonuses were originally supposed to be paid from the profits made by selling off profitable segments of the newly dismantled company.
So...where are the profits. See above. According to Liddy, the bonuses were promised in early 2008 because AIG saw FP as a continuing operation and wanted to set minimum pay levels for 2008 and 2009; once AIG hit a liquidity crisis caused by this division shouldn't the "mission" have been reconsidered as well as the bonuses?
Truth29:If we wanted to break the contracts, there was a process to do that through formal bankruptcy. That wasn't done.
Yep, that was the way to do it.
Once the government is seen as not a trustworthy partner, the costs of any public private partnership will go up with a further risk premium.
That would be a good thing, companies might not be so quick to rush to DC to beg for taxpayer money.
Perhaps not relevant...but interesting...there is a Jason DeSantis of who worked at AIG-FP of Redding CT who contributed $2100 to Chris Dodd's presidential campaign in 2006, and in the last election cycle AIG related contributions went 66% to Democrats. Is "Jason" "Jake," or is AIG-FP a family affair?
AIG also has a plan that will recoup and repay everything it owes to the government in two years.
This had nothing to do with the "bonuses".
Maybe you have noticed there has been no more talk of the unconstitutional bill taxing those people 90% of their money, that's because the bill has been quietly dropped and will not be brought to a vote. It was all political theatre.