Let me start off this post with a personal observation: Any entity with 80% ownership of a company should be able to stop that company from doing anything it chooses to stop, should it so desire. The US Government, thanks to the various bailout resolutions, owns about 80% of AIG. So to say that the government “couldn’t stop” those bonus from being paid is ridiculous. Sure they could have. They chose not to.
Those bonus contracts were explicitly protected by law when the Porkulus bill was signed so any issue arising from the government stopping those bonus payments – meaning, any lawsuit that would have followed – was the direct fault of Congress (specifically Senator Dodd whose staff put the provision into the law) and of the President (who signed it). So the fault, here, lies not with AIG and certainly not with AIG’s CEO Liddy but with the people now screaming at the tops of their lungs to get the money back.
Which means that all of those fellow Americans of mine who are issuing death threats to employees of AIG are woefully misguided both in the effort in the first place and in the target in any case. Shame on you all and knock it the hell off. I fully support law enforcement investigating every one of you and tossing your idiot posteriors in jail.
However, the flash-bang of this whole sordid event is serving to obscure the bigger issue and the White House is making very sure to keep people as focused on AIG’s bonuses as possible. Why? Listen to Bob Owens of Pajamas Media and Confederate Yankee:
But while the ire of Congress and the media focus are on the $165 million that AIG paid out in bonuses to their executives, the president is hoping you won’t notice the $100 billion in taxpayer bailout dollars that AIG paid out to other banks, including $58 billion to foreign banks and $36 billion given to French and German banks alone.
The Obama administration is allowing AIG to bail out the rest of the world with your tax dollars.
So by all means, the president is happy to have you railing at “evil” but relatively small potatoes AIG executive bonuses, as it points your outrage away from his own far more costly executive abuses.
There was, in fact, some media mention of this before the AIG bonus debacle was broken but the media sure seemed happy to switch horses quickly once the bonus story was available. I think the notion that AIG handed out bonuses when the only way they could afford such a move was when taxpayers were on the hook for the money was definitely in the “not good” category. However, most of those people who got those bonuses are Americans living and working here. The money AIG sent to Deutsche Bank and the French banks went to people and companies who definitely aren’t living or working here. That money just flowed right out of the country and is being used to prop up foreign firms and entities.
And American taxpayers had the obligation to do this… why?
There’s a darker undercurrent to all of this that Owens’ story goes into in detail. If you look at the firms who got the bailout cash and cross-reference them with donors to Obama’s campaign last year… well, there’s a surprising amount of overlap. Read the story I linked for the details.