One man's voice Thoughts, rants and commentary of a simple man

AIG: How to not pay attention to details

Unless you have been living under a rock for the last few days you have no doubt heard of the controversy brewing over AIG retention bonuses that are about to be paid out to their executives and other members of the division that has been alleged to be at the heart of our economic melt down. In essence what is at issue is the fact that AIG is stating that it must pay out about $165 million in retention bonuses to executives and other employees because it is contractually obligated to do so. Everyone that is hearing that dribble is asking the same question: "WTF?".

Somewhere along the lines AIG is claiming that they agreed to pay these bonuses prior to taking any bailout money from the government. They state that they had already had these bonus payment obligations when they secured bailout money and that as a result they have no choice but to issue the bonuses.

"Some of these payments are coming due on March 15, and, quite frankly, AIG's hands are tied," [AIG Chairman Edward] Liddy said, adding that he found the arrangements "distasteful."

Distasteful indeed. Perhaps I am missing something, but doesn't the US government now own 80% of AIG? And can't the government, who now owns AIG, renegotiate these "obligations"? It would seem to me that A) when AIG got their first installment of cash from the tax payers that this should have been seen; and B) just because these bonuses were previously promised does not mean that they need to go ahead and be paid.

I am sure that this could potentially pose a hardship to some AIG's employees, specifically the millionaire executives that helped land our country in the mess we are in (and incidentally who helped facilitate the hardest of hardships that we as a country have faced in the last 60 years). But seriously, employees that suck at doing their jobs as bad as those that did this to our country should not be rewarded for that anyway, so it makes sense to me to put that $165 million to use somewhere else. Perhaps in helping people get out of the crap they are living in.

Regardless, I am glad to see president Obama stepping in and trying to look good in the face of this debacle by trying to block the bonuses. Sadly I think it will be too late to affect any real change in this mess. Still, at least someone in government is trying to upend this thing.

I just wonder who in government dropped the ball on reading through the details when we first agreed to give AIG all this cash. I know that in September of last year, when the government agreed to give AIG $85 billion, both Barney Frank and Nancy Pelosi objected to it and criticized the move. Maybe they saw something wrong at the time? Probably not, since they were so on board with the continued bailouts offered by their comrade Barack Obama (bipartisan bishmartisan). Whatever the case, someone in power totally screwed up when throwing all this money toward AIG. It should have never happened to begin with, and now we are faced with trying to keep control over something we had no control over to begin with.