End the insanity
How much help in the form of health care, education and infrastructure could the money that AIG has paid out in "retention bonuses" to executives in its financial products group have provided?
The most recent $165 million in bonuses was just a portion of the $1.2 billion AIG has paid out in bonuses across the board in a company that lost $100 billion last year and which has accepted $183 billion in taxpayer support.
How much could this money have helped all of us instead of a greedy few?
Obama economic adviser Larry Summers says the government simply can't break the contracts that AIG had with executives, even as the treasury is forcing auto companies to break their labor contracts as a condition of receiving Troubled Asset Relief Program funds.
Why not? I doubt these executives have many options available to them in the form of offers from other companies eager to hire them after they caused the collapse of the world's largest insurer. They should be forced to stay, without pay, to clean up their mess!
Bonuses are supposed to be a reward for a job well done, not a foregone conclusion for simply staying in a job that you obviously were not very good at in the first place. The cook at the local fast-food restaurant knows that if he burns too many burgers he will be out of a job. I doubt that cook thinks that if he burns the place down he'll get a bonus to stay!
This move by AIG is insanity, and the insanity must end now!
J. ERIC PERSUN
Larry Summers was only able to posture for a day, feigning outrage at the AIG bonuses while saying there really was nothing he could do. He tried to placate public sentiment telling us not to be "vengeful" but the fury grows. I agree with him that vengeance is not the appropriate sentiment but a demand for justice is.
We need to see AIG turned around, not dealing in hedge funds and corrupt financial instruments. We need reforms that will change its way of doing business. We see clearly that the present crew, who are bound to defend their mistakes, are not the ones to do it. Not vengeful fury but a calm sense of the inevitability about the need for public intervention should guide us.
We need the government to take over direct control of AIG (of which the public now owns 80 percent) by an executive act of nationalization or a court act placing it in receivership. Then just as calmly and deliberately we need the government, acting in our interest, to institute reforms that restructure and clean out the management and practices of AIG.
This is the only practical way to put AIG's house in order.