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AIG Is Going to Pay Itself How Much, Now?
Giant financial monster AIG is sticking it to the man. The man being Barack Obama.
After cashing in on $170 billion federal bailout money -- the stuff that's funded by your taxes -- the company is going ahead with $165 million in bonuses to the executives who helped cause the financial crisis, the Washington Post has unearthed.
The company's government-appointed chairman, Edward Liddy, defended the bonuses in a letter to Treasury Secretary Timothy Geithner. He said the bonuses must be given to the execs because they were already promised last year.
In other words, these company "bonuses" are nothing more than guaranteed cash pinatas that are rewarded regardless of how well or terrible the execs do. For those of us not wheeling and dealing in the financial world, here is an analogy to the situation:
You break your mom's favorite plates. She gives you $100 to go buy new plates. You take the money and buy video games for yourself instead.
Further, Liddy told Geithner that the bonuses are necessary to keep the most talented executives at AIG -- presumably the supposed talented executives who lit their company on fire and gave Wall Street a heart attack.
"We cannot attract and retain the best and the brightest talent to lead and staff the A.I.G. businesses -- which are now being operated principally on behalf of American taxpayers -- if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury," Liddy explained.
Again, that might be complicated. Here's another analogy:
Remember those video games you bought instead of the nice plates? You tell your mom you need them to keep you happy so that at some point in your life you might think about buying those new plates.
As many as 400 AIG buddies are getting the money. The most lucrative bonus is for $6.5 million. Seven suits are getting more than $3 million. That's not a typo.
Here's an analogy --
Oh, you get the idea. It's a boatload of money.
After cashing in on $170 billion federal bailout money -- the stuff that's funded by your taxes -- the company is going ahead with $165 million in bonuses to the executives who helped cause the financial crisis, the Washington Post has unearthed.
The company's government-appointed chairman, Edward Liddy, defended the bonuses in a letter to Treasury Secretary Timothy Geithner. He said the bonuses must be given to the execs because they were already promised last year.
In other words, these company "bonuses" are nothing more than guaranteed cash pinatas that are rewarded regardless of how well or terrible the execs do. For those of us not wheeling and dealing in the financial world, here is an analogy to the situation:
You break your mom's favorite plates. She gives you $100 to go buy new plates. You take the money and buy video games for yourself instead.
Further, Liddy told Geithner that the bonuses are necessary to keep the most talented executives at AIG -- presumably the supposed talented executives who lit their company on fire and gave Wall Street a heart attack.
"We cannot attract and retain the best and the brightest talent to lead and staff the A.I.G. businesses -- which are now being operated principally on behalf of American taxpayers -- if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury," Liddy explained.
Again, that might be complicated. Here's another analogy:
Remember those video games you bought instead of the nice plates? You tell your mom you need them to keep you happy so that at some point in your life you might think about buying those new plates.
As many as 400 AIG buddies are getting the money. The most lucrative bonus is for $6.5 million. Seven suits are getting more than $3 million. That's not a typo.
Here's an analogy --
Oh, you get the idea. It's a boatload of money.
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Shelley
11:53AM 11:53AM Mar 15th 2009
These guys wouldn't have gotten a dime if AIG would have "Gone Under" and by all intensive purpose they "Went Under" if not for TAXPAYERS bailing their looser ass's out! So let's pick up the clue phone America and stand up for what's right and wrong. These guys don't get a BONUS.... just like millions of us have lost our jobs or haven't seen a raise who, do they think they are???? Please....these guys are the smartest and the brightest out there???? Why reward them with a bonus for getting us in this mess. As far as I'm concerned they broke their contract when the Taxpayers had to step in and pay for any "bonus" they THOUGHT they should get.
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David Moyer
4:11PM 4:11PM Mar 15th 2009
EXCELLENT OBSERVATION, AND LOGICAL. NOW WHEN THE LEGAL TRANSCENDS FAIR LOGIC, SHOULDN'T FAIRNESS PREVAIL? SHOULD WE BECOME VICTIMS OF LAXITY?
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M.S.
11:50PM 11:50PM Mar 16th 2009
I don't disagree with you but I do have a few corrections to make; First of all it is not "intensive purposes" it is actually "for all intents and purposes" so the use of this phrase makes no sense at all in what you are trying to say. Many people misuse this quite often because they hear it as "intensive purposes" but if you think about it, "for all intents and purposes", makes much more sense when you hear how this phrase is used in sentences. The other thing is "lose" as in "you lose" does not have two "o's" that would be "loose" as in, "your tie is loose", this is another common mistake but a big one no less. The last correction is "ass's" the correct plural form of "ass" is "asses". There are some other mistakes I won't mention but I'm just trying to educate because I see these errors a lot. I am not trying to be mean nor do I intend to insult your intelligence in any way, I am just trying to help so you don't make this embarrassing mistake at work or in formal writing. I am not perfect nor do I pretend to be and I am sure someone out there might be able to find a few mistakes I am making in this posting.
I apologize I am just a little bit of a stickler when it comes to these things and I see major mistakes like the ones I mentioned. Other than that I completely agree with your statement.
I don't understand how you can call anyone the "best and the brightest" when they have run a company so far in to the ground that it helped to collapse the global economy. I by no means think that AIG was the only factor in the collapse of the economy but it was a huge one. I have never worked for a company where anyone received a bonus when the company did not make a profit, let alone when the company was in the crapper. I say if these guys leave because they don't get their bonus "Good RIddance". I just don't understand the logic behind these ridiculous statements. If you went to get your hair done and the hairdresser butchered you, bleached your hair to the point of falling out and then asked to be paid the cost of the service plus a generous tip would you be upset if your failure to pay resulted in them not doing your hair again? HELL NO!!! You would never want to step foot near that person again!!!! You would definitely not call them the "Best and the Brightest". What other job in the world (besides being President, Hello George Bush) would this ever equal you not being thrown out on your ass?!!??
If I'm doing the math correctly AIG actually only needs $169,835,000,000 from us, so why don't we just give them that and let the "Best and the Brightest" figure out a way to come up with the rest?
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anon
11:08AM 11:08AM Mar 15th 2009
A contract is illegal when it cannot convey a benefit
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Robert
1:40PM 1:40PM Mar 15th 2009
Pitchfork, anyone?
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Red
3:01PM 3:01PM Mar 15th 2009
Hey Matt
That aint all. Manchester United, the famous soccer team owned by Malcolm Glazer, sport on their bright red jerseys AIG. Why are we taxpayers supporting a rich man's toy?
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Mike
3:15PM 3:15PM Mar 15th 2009
I don't exactly trust a whole lot that comes out of Left wings articles...
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rrh2034271
3:26PM 3:26PM Mar 15th 2009
If you had employees that last you money, would they get a rais or a bonus or would they get fired? Dah? They would get fired, wouldn't they? (If not can I come work for you?)
As far as the Gov not being able to "do anything about it", then those Gov officials should be fired as well!
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Ken
6:58PM 6:58PM Mar 15th 2009
I suppose turnabout is fair play. All the bad debt that the financial companies created, are contractual. They created them, and are now bound to live by them.
They've decided, that since those particular contracts aren't making them any money, that the government should assume, or insure, those losses (what they are in business to do.) These mega losses are what you created as a way to make a mega profit, without thinking about the ramifications.
Here's an analogy for you. You tell your mother, that breaking her fine china will in fact, benefit her. Rightfully questioning the logic of such an endeavor, you concoct a story so convoluted, that by the time you're done, she agrees with you. Your now plateless mother reluctantly gives you money for more plates, which you don't buy, but spend on video games. When questioned about your not buying plates with the money, you explain that the agreement you entered into to break said plates may not have been the best idea, but you agreed to it. you toss her a package of paper plates, and keep the rest.
If the financial market relies on contractual strength, the unethical 'best and brightest' have shown that they have a double standard, where some agreements are not binding, those being the one's in the red ink. The one's that benefit themselves, are unbreakable.
Best and brightest? In a system where inventive stealing is the objective, they can absolutely take that title. The big question is, how long are we going to put up with it?
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maineddie
12:59AM 12:59AM Mar 16th 2009
When are you CITIZENS of AMERICA going to get off your comfy couches and stop the thievery, deceipt and corruption that Federal government has become? I advocate armed insurrection against our current political overlords as the only means of lasting change and salvation for the Citizens of the United States of America. A new Constitutional Congress must be formed with the avowed purpose of adding strict and unchangeable common sense provisions to the basics that our Founding Fathers,in their wisdom, graced us with over two centuries ago. CHANGE must be FOUGHT for!
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Ed
1:17AM 1:17AM Mar 16th 2009
Federal government wont change without a fight. They are still stealing, lying and cheating from YOU, Honest American Citizens! When written Laws take precedence over basic common sense, the system must be changed if we are to survive as a nation. Fight them, America! Fight them any way you can. If our Tree of Liberty demands watering with the blood of Patriots to grow strong, then so be it. FIGHT THEM!
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cc
2:54AM 2:54AM Mar 16th 2009
ABSOLUTE DISGRACE
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Cathy
8:28AM 8:28AM Mar 16th 2009
It is time for us as Americans to do something what I am not sure about but the ones that are getting these so called promised bonuses should have been fired a longtime ago before any of the money was RELEASED to AIG.
There are a lot of young people out of worksome freah out of college that could have been recruited. many of the up and coming executives from AIG could have also been promoted from within.
Not only should those Exec not get a dime of the bonus money but many of them should be Jailed for the Fraud they committed by pretending they knew anything about Banking or insurance.
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graeves
11:52AM 11:52AM Mar 16th 2009
They SCREWED AMERICA AND WANT TO GET PAID A BONUS because of a prior cpompensation agreement written before they knew how stupid they were.
Let this be a lesson to us all --- never ever do business with AIG. The outragous bonus payment speaks volumes as to AIG executives lack of good moral or prudent business judgement.
I say don't pay it, let these idiots sue for it. At least then they will have to disclose who THEY ARE. They would all be out of a job if it were not for the $170 billion in taxpayer funds.
Can you imagine what will happen when the condidential list of executives receiving such is eventually leaked. These people aren't Robinhood, rather they robbing us.
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Ron
8:29PM 8:29PM Mar 16th 2009
The bonus payout excesses at AIG are just the tip of the iceberg of what is happening with the other Wall Street bailouts including Bank of America. Working productive Americans are bailing out the same crooks that destroyed our economy along with 45% of the wealth in the world and now the American taxpayers and our children will be forced to live a far lower standard of living with reduced prosperity and opportunities due to this but only we pay the price.
Washington has bailed out the banks, Wall Street & their Washington special interests and much of the cost is added to the national debt to by paid by this and future generations while real estate and investments continue to fall. Find out what a growing repudiate the debt movement could mean for treasuries, the dollar, gold and the stock market and how this is a better alternative than Washington’s plans to monetize the debt in future years and tax and destroy our remaining wealth by depreciating the dollar.
The Campaign to Cancel the Washington National Debt By 12/21/2012 Constitutional Amendment is starting now in the U.S. See: http://www.facebook.com/group.php?gid=67594690498&ref=ts
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citizen
12:25AM 12:25AM Mar 17th 2009
I agree with the post about not doing business with AIG. The problem, however, is that they will post even greater losses and ask for even more bailout money. Either way they WILL get our money, as long as the government continues to bolster their mismanagement.
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Gary
7:20PM 7:20PM Mar 16th 2009
WOW!!. I have been recieving compensation payments through AiG for the last 4 years and so many months for a broken neck and other damage suffered in a motor vehicle accident. Not counting the last three months i have had no less than three of my attorneys, on my behalf, beg for me to recieve said payments in a timely fashion, every two weeks is my new pay day, and these people have had the nerve to reply in turn that they have had computer failures, one time lasting a month, during the Christmas 07/08 holiday, and that was why i had to wait 30 days to recieve compensation!!!. Mileage reimbursement checks under state law where i reside is to be addressed within 30 days, 9 months later i have yet to recieve mileage checks, my attorneys once again had to appeal to state special funds and workers compensation board to get this issue satisfied, still waiting as of this date. AND now they want to pay bonuses?? when they can't even pay the people they are contracted to support?. CHRIST!! when will this crap end??. Gotta go, i'm getting more pi$$ed by the minute, and aint nothing worse than half a cripple getting mad!.
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RL
7:18PM 7:18PM Mar 16th 2009
Contract or not - if these 'employees' can not on their own refuse the bonus considering the state of the economy and how their greed will be portrayed, then they all deserve to the judgement the Lord will repay them with in the end. If anyone is a customer of AIG -Wake up!! Send them a message and dump them!! It's not rocket science people they can not survive with out customers.
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Sports Fan
8:44PM 8:44PM Mar 16th 2009
Take away the "bonus money" and give them the rest. They however, have to do exactly what the money is intended to do for us. If they are the brightest then they will find a way to pay themselves without us footing their incompetence.
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Scott
8:25PM 8:25PM Mar 16th 2009
I still say that AIG should be allowed to collapse.. WHY is America insuring other countries? so that the other countries can file bogus insurance claims and thus bleed the insurer dry? how much of the worldwide payments lined the pockets of terrorists known or UN-known? If I own a business and I have contracts to fulfill but go bankrupt in the mean time my contractors are free to sue me.. has anyone EVER successfully gotten BLOOD out of a TURNIP? I know I haven't.. that is what chapter 11 bankruptcy is for. AS for AIG FIRE the B@STARDS let them sue for their ill-gotten gains and then let the supreme court set them straight. AIG is an albatross better left to rot. Politicians get way more money than they are worth (with few exceptions). and as far as the constitution.. constitutionally all our politicians are forbidden to have the offices they hold.. Then Corporate america is the grediest bunch of yayhoos I have ever run across.. CORPORATE america is nothing short of a band of thieves!!!!!!!!!!!!
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