Mar
22
The past week has seen a huge surge of anger directed toward the AIG leadership over the retention bonuses they paid out to some of their employees (in a few cases, ex-employees). Yes, it is horrid that AIG, a public company that has taken billions in Federal assistance (meaning I, as an American tax payer, now own part of AIG myself) paid huge and gross bonuses to the very employees that lead the company to the brink, it is worse the deception being played out in Washington.
This very issue was questioned months ago by Congress, but at the behest of President Obama and the Democratic leadership an exemption was placed on these very bonuses that everyone is now so worked up over. If the Democrats were truthful and forthcoming we would have all had the opportunity to enter our opinions – instead the debate was behind closed doors where there is no accountability. Senator Chris Dodd lied directly to the public regarding his responsibility for the exemptions saying he had nothing to do with the ammendment that opened the way for the AIG bonuses. On Wednesday he completely reversed that statement and announced he was the man you enter the ammendment and made the changes. Dodd, as we all know, is a leader of Democrats in the Senate and campaigned for president just last year.
More importantly than Dodd’s bold-faced lies, however, are Obama’s weakness over the whole “scandal.” Dodd stated the Obama administration “asked for modifications.” And now Obama is spouting his own innocence saying he knew nothing about the bonuses until last week despite the fact the Treasury Department has known about them for months. Isn’t Obama the President, and the Treasury works for him? Either he is lying or he has chosen poor leaders for his department.
It is time to stop giving the Democrats so much slack. They have been making blunder after blunder and passing the blame on to others. They must be held accountable for their actions and deeds. Unfortuantely, their actions prove them to be inept, power-mongering individuals who are not in Washington to serve their country.
More about Chris Dodd’s duplicity: CNN.com
So, the administration shouldn’t be upset about what a private company is doing with taxpayer dollars? The real question here is: Why is a company that’s broke not fighting to claw back these bonuses that are going to the employees that got the company in such deep trouble in the first place?
Keep in mind, all of the bonus money is going to employees of AIG Financial Products, a division that the company is shuttling out the door, as it is the sole reason the company needed a bailout in the first place. The head of that unit, Joseph Cassano, pocketed over $280 million in compensation over that amount of time, by selling more credit-default swaps than the company had collateral to cover. Cassano was let go in 2008, but was retained as a “consultant” for $1 million per year.
What the government should have done was take over all of AIG, since the US bartered with the EU to maintain regulation over the company. They should have sold off the profitable portions of the company, while stripping the credit default swap financial products off of the books. The money for those defaults is being paid to other banks that bet against mortgages as a form of insurance, like Goldman Sachs, JP Morgan Chase, Citi, and Bank of America. Unfortunately, the Republicans have shown that they will attack this as “socialism” of the banking system, even if it is the prudent thing to do. There’s no amount of political capital in the world that Obama could use to make a case for this type of action, because the GOP is more concerned about winning elections and scaring the electorate than governing properly.