Let's say you are an AIG employee

Pekelo · Mar 18, 2009

You work for the insurance department and your part of the company made money. You got a bonus. Now the CEO is asking for at least half of your bonus back.

What do you do???

DataCruncher · Mar 18, 2009

I think Liddy is focusing on asking the bonuses back from the financial products division, not insurance division

nutmeg · Mar 18, 2009

I'm a taxpayer. I want you to keep all of your bonus, I'll never miss the money.

CoralReef · Mar 18, 2009

Top 10% of income earners pay 70% of all income taxes. So, all you poor a-holes that are crying about the bailouts of banks and AIG need to STFU. You're not paying for it anyway.

slacker · Mar 18, 2009

These employees signed a contract to continue working for a period after their job was gone. Seems the government and the employees in question entered into the contract in good faith.

One significant point that emerged from the testimony of AIG's Edward Liddy is that the bonuses that have stirred controversy were all, within AIG's financial products division, retention bonuses, not performance bonuses:

LIDDY: Congressman, I -- I think the contracts that you are reading from have to do with performance bonuses. No performance bonuses at F.P., zero. It's a different issue than the retention bonuses, where we basically said to people, "You have a job. That job's going to go away after you wind down the book of business that you manage. If you'll stay"...

(CROSSTALK)

FRANK: So you're talking about the only bonuses that were paid recently were the retention bonuses?

LIDDY: Yes.
***
Liddy: What we asked them to do was to stay, do a specific amount of work, and if you do that, at the end of that period of time and you've done that work, we will give you a retention bonus. That's what those payments were. So they did the work. They reduced the risk from that $2.7 trillion down to $1.6 trillion. And the American taxpayer is better off because we have less risk.

AIG hired (or retained) employees to supervise and wind down the financial products division's book of business, then well in excess of $2 trillion. Since the business was being wound down, these jobs were not great career opportunities. So AIG entered into agreements with its employees that if they would stay for a given period of time, they would earn a bonus. The bonuses that fueled the current controversy were paid to employees who held up their end of the bargain by remaining with AIG.

So an employee is promised a bonus if he stays on and works another year in what would otherwise be a dead-end job; in reliance on that offer, he stays and works for a year. Now Congress wants the bonus back. It's hard to understand how that comports with anyone's idea of fairness, let alone legality.

Remember when George Bush was "shredding the Constitution?" Ah, those were the good old days! Now we have Congressional Democrats trying to give themselves political cover by advocating patently unconstitutional legislation singling out a few hundred employees of a single company for a "tax" that would reclaim money that they were promised, and earned, with the full knowledge and consent of the Federal Reserve and, it turns out, Congress.
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From wikipedia

A bill of attainder (also known as an act or writ of attainder) is an act of legislature declaring a person or group of persons guilty of some crime and punishing them without benefit of a trial. Bills of attainder are forbidden by Article I, section 9, clause 3 of the United States Constitution.
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I will bet that the Constitution and the rule of law holds and the employees get their money.

The Nephilim · Mar 18, 2009

These employees signed a contract to continue working for a period after their job was gone. Seems the government and the employees in question entered into the contract in good faith.

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Wow, some good faith, I am directly responsible for losing $60 Billion dollars and when told that my job is now history I get to agree to stay on to prevent the company losing any more money due to my complete incompetance and for that I get a nice fat million dollar bonus. The sense of entitlement is staggering, I f**ked up but wait if you promise me a million dollars then I will try not to F**k up anymore, wonderful, wish I got paid like that.

eagle · Mar 18, 2009

The chairman admitted that mistake had been made and gave a reasonable explanation about those bonuses. He has to solve two problems - to calm down the public wrath and at the same time to keep his employees satisfied. I think the solution he has taken is the best possible. Now, we all (public/congress and AIG employees) should accept and move on to focus on the bigger problem.

slacker · Mar 18, 2009

This is just political misdirection pointing to $168m which is nothing on a day when the Fed created $1 TRILLION out of nowhere. Are you indignant and pissed about the Treasury purchase today. Or are you not worried about it because you got a 90 point bounce in the Dao?

bathrobe · Mar 18, 2009

I do not think the bonuses are warranted since the company is recieving the largest bailout in history. On the other hand if I worked at AIG and received one, I would feel different.
If I were a college student right now analyzing the clearest path to the top spots at the largest companies in the U.S. I would possibly come to the conclusion that I should simply fuck up and that would be a clear path to the top where I could the fuck up more than anyone else in the history of the job had. I would then be fired after a year in which I would collect 100m-1b.

The lesson I would take away is the new losers win culture that has taken over here.

eg Stan O'Neal.............John Thain

Ticketwatcher · Mar 18, 2009

Liddy made an interesting argument for paying the bonuses. It was the doomsday argument. If these people were not paid that AIG would blow up and therefore probably the whole financial system would blow up.

And you know what, I trust Liddy more than I trust ANY Gubmint official. The guy had nothing to do with AIG and he is not being paid a red cent.

I say pay the blackmail money.

These AIG boys and girls have the power to destroy the financial world in their hands. Up until now I always thought that kind of financial power in this country was held by the likes of helicopter Ben, congressional heads of appropriation committees, Treasury Secretaries and yes even the POTUS.

But evidently those boys and girls are impotent when compared to the nameless, faceless boys and girls at AIG who just received a 160 mil.