Let me be specific: If you didn’t like reading about A.I.G. brokers getting millions in bonuses after their company ”” 80 percent of which is owned by U.S. taxpayers ”” racked up the biggest quarterly loss in the history of the Milky Way Galaxy, you’re really not going to like the bank bailout plan to be rolled out soon by the Obama team. That plan will begin by using up the $250 billion or so left in TARP funds to start removing the toxic assets from the banks. But ultimately, to get the scale of bank repair we need, it will likely require some $750 billion more.
The plan makes sense, and, if done right, it might even make profits for U.S. taxpayers. But in this climate of anger, it will take every bit of political capital in Barack Obama’s piggy bank ”” as well as Michelle’s, Sasha’s and Malia’s ”” to sell it to Congress and the public.
The job can’t be his alone. Everyone who has a stake in stabilizing and reforming the system is going to have to suck it up. And that starts with the brokers at A.I.G. who got the $165 million in bonuses. They need to voluntarily return them. Everyone today is taking a haircut of some kind or another, and A.I.G. brokers surely can be no exception. We do not want the U.S. government abrogating contracts ”” the rule of law is why everyone around the world wants to invest in our economy. But taxpayers should not sit quietly as bonuses are paid to people who were running an insurance scheme that would have made Bernie Madoff smile. The best way out is for the A.I.G. bankers to take one for the country and give up their bonuses.
I live in Montgomery County, Md. The schoolteachers here, who make on average $67,000 a year, recently voted to voluntarily give up their 5 percent pay raise that was contractually agreed to for next year, saving our school system $89 million ”” so programs and teachers would not have to be terminated. If public schoolteachers can take one for schoolchildren and fellow teachers, A.I.G. brokers can take one for the country.
Tom? When Barry returns the campaign contributions AIG sent him, then we can talk about taking one for the country.
Link here:
http://www.opensecrets.org/orgs/toprecips.php?id=D000000123
Perhaps the Vice-President and the Secretary of State could take one for the country as well
What about the bonuses for Freddie Mac and Fannie Mae? Are those being returned? What does Congress have to say about those?
If Congress had done its job right, we wouldn’t be having this conservation about the AIG bonuses. But since contracts were signed (and wording included in the stimulus bill upholding those contracts) and the stimulus bill not put out for public consumption before it was voted on so people would know about this (even though the bonus information is a year old), let’s not now create a rabble mob mentality for the AIG execs. I think what Sen. Grassley said was despicable and I think it’s laughable to see Rep. Barney Frank act indignant about the whole thing. It is NOT a good thing for people to lose faith in their government’s ability to govern. And it’s NOT a good thing for the government to start going after private citizens because they don’t like their pay structure.
Here’s link to the info on the Fannie Mae bonuses – http://finance.yahoo.com/news/Fannie-plans-bonuses-of-up-to-apf-14679491.html
The two biggest political recipients of AIG cash: Pres. Obama (who signed the bill assuring they would get bonuses) and Sen. Dodd (who made the verbatim change to assure the execs got their bonuses) They are complete hypocrites when it comes to AIG. Americans should be appalled and outraged at Congress and the President.
[blockquote]Rep. Paul Hodes (D., N.H.) declared that the AIG employees’ contracts containing the bonuses “should be held to be invalid or unenforceable on the grounds of public policy.†(No one is sure exactly what that is supposed to mean.) Rep. Barney Frank (D., Mass.), chairman of the Financial Services Committee, suggested that the government use its status as 80-percent owner of AIG to sue and recoup employees’ contractually obligated bonuses. “They gave themselves contracts that insulate them from the losses,†Frank complained. “We’re the effective owners of this company. We ought to exercise our rights as the owners . . . . Let’s bring a lawsuit, as the owners, against people who really did damage to the company.â€
But Frank, Hodes, and 244 other congressmen — all Democrats — voted last month for a stimulus package that explicitly allows TARP funds to be used for such bonuses. To be precise, President Obama’s $789 billion stimulus package contained the following provision, which deals specifically with executive compensation at AIG and other companies that receive TARP money:
The prohibition required under clause (i) shall not be construed to prohibit any bonus payment required to be paid pursuant to a written employment contract executed on or before February 11, 2009, as such valid employment contracts are determined by the Secretary or the designee of the Secretary.[/blockquote]
http://corner.nationalreview.com/post/?q=OTlkOTFjNmE3ODdiMzZjZjdhYWVjYTMwMDVkZTMzOTI=
And if this is not enough, from the same article:
[blockquote] Rep. Ed Royce (R., Calif.) read this statutory language to the subcommittee twice during the hearing’s early-afternoon session, just in case anyone was unaware. The executive compensation loophole was not merely a holdover from President Bush’s original bailout plan. It was laid out in clear statutory language that was enacted and signed by Democrats over vigorous Republican opposition. The provision was inserted in conference committee by Senate Banking Committee chairman Christopher Dodd (D., Conn.), one of the biggest beneficiaries of political contributions from AIG employees.
As Royce noted, “Some Democrats were aware of the bonuses, and went out of their way to protect those bonuses.†President Obama was one of them, but you would not know it from his dramatic performance on Monday, when he addressed the issue of AIG bonuses. “I mean, how do they justify this outrage to the taxpayers who are keeping the company afloat?†Obama asked. “This is not just a matter of dollars and cents. It’s about our fundamental values . . . excuse me, I’m choked up with anger here.†[/blockquote]
In a civilized society contracts are not subject to the political winds and angry mobs. Sure we are all outraged. Equally sure the contracts a real, binding, and known to and included in the bailout bill. The sudden outrage doesn’t have an ounce of integrity.
And then there’s href=”http://news.yahoo.com/s/politico/20090318/pl_politico/30833″>this:
Please remember that the Democrats, in ridding Washington of the “Republican Culture of Corruption” ,seemed to give Franks and his fun with Fannie and Freddie a pass and gave Senator Dodd a get out of jail free card for his “special†loan from Country Wide! Which has been worst some one tapping his foot under a toilet stall or the Fannie and Freddie debacle?
A friend of mine suggested that each state fund and provide the salary, salary increases, housing and staff, by constitutional amendment for each representative and senator giving control of these clowns (democratic and republican) back to the states. A bill would be passed by each state legislator each year to the funding.
The plot thickens:
[blockquote]March 19 (Bloomberg) — Senate Banking Committee Chairman Christopher Dodd said the Obama administration asked him to insert a provision in last month’s $787 billion economic- stimulus legislation that had the effect of authorizing American International Group Inc.’s bonuses.
Dodd, a Connecticut Democrat, said yesterday he agreed to modify restrictions on executive pay at companies receiving taxpayer assistance to exempt bonuses already agreed upon in contracts. He said he did so without realizing the change would benefit AIG, whose recent $165 million payment to employees has sparked a public furor.[/blockquote] http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aT_tMXRy2vDs
I think we need to go back to the days when Senators were appointed by each state’s House of Representatives — and subject to recall.
Jim, your idea would work well to!
I’ll go along with putting it back the way it was.