Monday, March 16, 2009


A.I.G. used to stand for American International Group. Today it stands for Arrogant Institutional Greed.

The big international company which has received more than 170 billion in taxpayer bailout money is paying nearly 165 million in bonuses to many of the same people in the business unit whose decisions lead to the companies catalyst for collapse last year. The total amount of “retention” bonuses is $450 million over the next few years.

The argument is that the bonuses are needed to keep the most skilled executives. Skilled? Are not some of them the ones who brought the company to the brink of disaster? Isn’t this the company that wrote trillions of dollars’ worth of credit-default swaps backed by subprime mortgages?

Like a lot of Americans I don’t understand the intricacies of company and government finance; it’s not my field of interest.

I do understand greed when I see it. I do recognize arrogance when I see it. I know of inappropriate bonus transactions and alleged obligations and I don’t like what I see.

It seems that a body of legal analysts looked at the AIG contracts promising the bonuses and apparently said they were contracted early last year before any bailout money was given and legally must be paid. Hogwash.

If the company had been allowed to default, to go bankrupt, which I understand could disrupt the economic system of the world, where would the bonus money promised have come from?

It seems to me that at that point all contracts are null and void and all promises negated. The American taxpayer, who now owns nearly 80 percent of the company, should not be responsible to pay contracts or bonuses agreed to before it ever got involved. Come on…where is common sense?

And as for keeping the “skilled” executives. How many do you think will put AIG financial Products Unit on their resume when they look for a new job?

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