That's what we need to say to these AIG Execs who can't live without their bonuses. I agree with Rep. Barney Frank:
And by the way, it does appear to me that we're rewarding incompetence. Forget about the legal matter here for a second, these bonuses are going to people who screwed this thing up enormously, who made terrible decisions. . . Maybe it's time to fire some people. We can't keep them from getting their bonuses, but we can keep some of them from continuing in their jobs. I am very skeptical that these "retention bonuses" these people got "retention bonuses" well if they were in high school they wouldn't have gotten retention, they would have gotten detention . And the time has come now to probably look at it and get rid of some of them.
(I only transcribed part of it)
This AIG crap is really getting on my nerves. We keep hearing about how AIG is too big to fail, and how we can't do anything that runs afoul of the employment contracts well, we can FIRE their asses. Like Rep. Frank said, we now own a lot of that company, and those people are FAILING and FAILING HARD. Why do they get rewarded continually? The fact that they are STILL giving bonuses even after they were supposedly reprimanded by the Obama Administration shows a serious lack of respect. Why would we even want to keep these people on? They were incompetent and fucked up, when you fuck up, you get fired. Look @ the Republicans, they fucked up, and the American people FIRED them.
AIG has agreed to Obama administration requests to restrain future payments. Treasury Secretary Timothy Geithner pressed the president's case with AIG's chairman, Edward Liddy, last week.
"He stepped in and berated them, got them to reduce the bonuses following every legal means he has to do this," said Austan Goolsbee, staff director of President Barack Obama's Economic Recovery Advisory Board.
REDUCE the bonuses? No, STOP the bonuses. I'm sure those people won't end up homeless. I'm all for giving the Obama Administration the benefit of the doubt, but I feel like they are failing, and failing HARD on this point. Now they are trying to cover their own asses and give excuses for why we shouldn't blame the government for giving the loans, but I'm not buying it. If we are the only reason they are staying afloat, we should have some say in stuff like where the money is going. If Congress AND the White House don't agree with the bonuses, well then they need to stop TALKING and DO SOMETHING about it. I don't want to hear anymore talk. We've been hearing about how AIG is still living high on the hog since the TARP funds were first dispersed. It's like AIG KNOWS the government won't REALLY do anything to them, so they are going to do whatever the hell they want, and it's really pissing off EVERYONE (well I guess everyone who isn't working for AIG). And I guess Obama and Geithner are going to "address" the AIG bonuses when they talk to the small business owners, I'm no holding my breath that they will say something different than what they've said before.
And if they don't want to stop the bonuses, then DON'T GIVE THEM ANYMORE MONEY! They don't HAVE to take the money, they can continue to fail just as well without it. If you watch the whole video of the Frank Interview on the Today Show, Merideth asked him about the banks who are saying they don't want the money because they don't want to comply with the requirements to get it, and he basically said "Well good, they can give it back. We aren't forcing anyone to take the money." It's just like those Governors who don't want to take money from the Recovery and Reinvestment Act because they don't want to comply with the Federal requirements to get the money, well fine, we can give the money to people who need it and will actually USE it to help the country.
Breaching contracts is not good form, so get rid of the contract by firing the execs who can't even give up their precious bonuses in light of the fact that they don't deserve them. Most employment contracts are at-will anyway, so they probably don't even need a REASON to be fired (although they have given us PLENTY of reasons to fire them).
[UPDATE 12:05 PM ET] Just got an email from MoveOn:
Dear MoveOn member,
If you had to find one single group of people to blame for our economic crisis, you'd definitely have to consider the financial products division of AIG.
They made huge, bad bets on the housing market that have cost taxpayers $170 billion...so far. That's more than $500 from every American.1
But get this: The Washington Post just reported that these people are receiving $450 million in bonuses—and they got their first installment yesterday.2 They destroyed our economy, and now they're being rewarded for it with our bailout money!
We can't let this stand. Treasury Secretary Tim Geithner and Congress need to do whatever it takes to get our money back.
Can you sign our petition today and then pass it on? We'll deliver it to Secretary Geithner and the congressional committees that supervise AIG. Clicking below will add your name:
After you sign, please forward this to friends and family to make sure the outcry is impossible to ignore. The petition says: "Under no circumstances should the AIG executives who helped create the financial crisis receive bonuses. That's our money and you should do whatever it takes to get it back."
The government may need to get creative to recover these bonuses, but where there's a will, there's a way. And some folks in Congress get it. Representative Barney Frank and Senator Russ Feingold are already investigating ways to get the money back.3
Secretary Geithner already shamed AIG into reducing the bonuses they planned on paying out. But seven executives in the financial products division still received bonuses of more than $3 million each. These people wrote literally trillions of dollars in insurance contracts—those infamous credit default swaps—that they could never hope to cover. And they're getting huge bonuses for perpetrating this fraud.
AIG's main defense is that they have to honor the contracts with these employees. But let's be clear: AIG would be bankrupt and these folks would already have been laid off if it weren't for the government's massive infusion of money. The big car companies took far less taxpayer money, and they're modifying their contracts with autoworkers. AIG should do the same with its employees.4
Geithner and Congress need to do whatever it takes to recover that money.
Wall Street has proven over and over that it's incapable of policing itself. So our elected representatives need to. Sign the petition below and we'll deliver it to Secretary Geithner and Congress to let them know that we're counting on them to step up. Clicking here will add your name:
Thanks for all you do.
–Daniel, Eli, Peter, Tanya and the rest of the team
[UPDATE 12:35 PM ET] Here's what Obama had to say about it just now:
But before I talk about the new steps we're taking to get credit flowing to small businesses across our country, I want to comment on the news about executive bonuses at AIG.
This is a corporation that finds itself in financial distress due to recklessness and greed.
Under these circumstances, it's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?
In the last six months, AIG has received substantial sums from the US Treasury. I've asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole.
I know he's working to resolve this matter with the new CEO, Edward Liddy, who came on board after the contracts that led to these bonuses were agreed to last year.
This isn't just a matter of dollars and cents. It's about our fundamental values.
All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multi-million dollar bonuses. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules.
That is an ethic we must demand.
What this situation also underscores is the need for overall financial regulatory reform, so we don't find ourselves in this position again, and for some form of resolution mechanism in dealing with troubled financial institutions, so we have greater authority to protect the American taxpayer and our financial system in cases such as this. We will work with Congress to that end.
(emphasis is mine) Yeah, I'm not convinced. I do think he's angry about it, I don't really think they are going to be able to stop it. He just choked on his words and joked that he was "choked up with anger."
[Update 4:05 PM ET] Just heard on MSNBC that AIG is ramping up security because they are worried about the fallout over these bonuses. I'm looking for a link now.