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AIG Bonuses
Yar
Registered User regular
Registered User regular
Let's get this out of the GOP thread.
They've already agreed to that as well. THe 2009 bonus structure is being overhauled.
Well, the government didn't stipulate which contracts they should and should not make good on. And I don't think I much approve of the assumptions you're saying they should have assumed. You say they should pay back all their CDS debt to foreign banks, even though those foreign banks failing maybe ought to be what happened since getting so heavily invested in CDS is a big part of what caused this mess. And, you know, they aren't American and this is American tax money. But they shouldn't honor compensation contracts to employees. Because those employees are villians or whatever. I don't get it.Again, all the money was used to fulfill contractual obligations. A whole lot more money (like 100 times more) went to fulfill contracts with foreign banks than did contracts with domestic employees. Your argument doesn't really hold much of anything. You're saying that AIG just shouldn't be paying money they owe their employees, because you want to continue to believe that there are villians there who deserve their punishment.
Paying off financial obligations to another bank or business is not the same as paying off bonuses to people who work there. The government could have said "hey, you don't have any fucking money. Here is some money to pay off other banks and insure your shit so you don't go under", the government has no obligation give them any money, and they do not have to give them money to pay off employees that wouldn't even have a paycheck.
These people can then sue AIG. Maybe by the time the company turns around and makes a profitAIG could pay off their contractual bonuses.
nexuscrawler wrote: »@Yar: I think you're deflating their base compensation. My friend is still a junior banker at one of the smaller firms on Wall Street and made $60,000 in base salary her first year on the job while receiving an $80,000 bonus at the end of her first year. That is not lower-middle class, not by a long-shot, particularly for a single person with no children (and it doesn't count all of the perks that came along with her job, like black car service and meals). $60,000 is a lot of money right out of college, with little work experience other than internships at financial institutions. It's hardly lower-middle class, even in NYC.
Really, people who make $60K need to be denied their bonuses? How far does wealth hatred reach? $50K? $40K? I think the answer is, "anyone who makes more than me."Yeah, I agree. Populist outrage might actually hurt the recovery because, like it or not, additional bailouts of financial institutions are going to be necessary. We haven't gotten anywhere near the bottom of this, considering the massive amount of toxic debt still gumming up the sheets of Citigroup, BofA, etc.
I think people have their hearts in the right place (this isn't FAIR!) but the sad truth is that it isn't fair but we have to live with that for now so we can fix what's broken to get our economy going again. We can save the grandstanding and arm waving for AFTER this is all over (and hopefully, we can change things so we don't have to do this again any time soon).
Yeah I guess I'm just looking for a little more detail and direction in people's wrath. The media likes to throw big numbers and weighted words at you, and I just am dumbfounded at the amount of rage that even the President himself seems to pretend at all this, without even knowing the specifics and the rationale.
The current CEO has only been there a few months, coming in after much of the bailout money, and he was put there by the government. He makes $1/year, and all the executives already voluntarily gave up all 2008 bonuses and 2009 raises. He is the one saying that these remaing bonuses to non-execs are owed and cannot be cancelled. We aren't talking about executives anymore. At some point you ahve to accept that in order to keep doing business, people have to be paid what they were told they'd be paid.
True ebnough
They contractually will have to pay the people their money. however saying it's "just how they do business" is silly. Maybe it's time they fundamentally reevaluated how they do business because their current model obviously sucks some serious cock.
They've already agreed to that as well. THe 2009 bonus structure is being overhauled.
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How about you read before you reveal yourself to be a fool? Here's AIG's white paper on the source of these bonuses, the retention plan. This was not a performance bonus. Also And the white paper indicates a clear solution Remove this restriction and you're done.
ed
Financial Products produced almost all of the losses in the company. AIG overall is relatively well run, almost all the fan-hitting-shit came from this one office.
QEDMF xbl: PantsB G+
I don't recall all this standing on principle about the wall between private enterprise and federal involvement from the companies when they were desperate for federal funds to stay in business and I certainly don't recall all this meticulous concern for contract law when we were talking about how overpaid the autoworkers were.
It's pretty clearly a case of the people in question at AIG being absolute idiots on the matter, but if I'm being 100% honest I'm overjoyed. The dumbasses just handed the administration an air tight case for why the financial sector needs to be nationalized and then resold under new management and a political firestorm to drive everyone on both sides of the aisle into full throated support. It's no longer a matter of will the banks and AIG be nationalized and the shareholders and executives wiped out, it's a matter of when Obama feels like pulling the trigger.
The government should have stipulated not to pay bonuses. You act like we are taking something from them, like the government owes it to them to pay their bonuses even though the contractually obligated private company is broke dick.
Nobody would be "punished" for everything. The government not giving you a million dollar bonuses they have no obligation for is not being "punished" it's not getting a god damn free hand out. By your logic if I demand the bonus my company did not give me last year, because they didn't have the money, the government must pay it to me and if they don't it's punishment.
I'm sorry but that's bullshit.
The government should give them money for business obligations to banks and to help free up credit to prevent the entire system from falling apart. Giving them money to pay bonuses has nothing to do with keeping the system from crashing down.
If you're going to bail the bank out then yes, a lot of local employees and foreign banks who perhaps deserve to be thrown to the wolves as an example to others will get free passes, bonuses even. It might not be pretty but your options are either let the banks fulfill their contracts with bailout money, nationalize them completely, or let them fail. If the government is going to dictate to the bank which obligations to pay and which not to then your fooling yourself if you think that isn't nationalization.
http://consumerist.com/5170898/ny-attorney-general-to-aig-you-have-until-400-pm-to-give-us-the-names
Edward M. Liddy, Chairman & CEO American International Group, Inc.
70 Pine Street New York, NY, 10270
Re: AIG Compensation Investigation
Dear Mr. Liddy:
The Office of the New York Attorney General has been investigating compensation arrangements at AIG since last Fall. We were disturbed to learn over the weekend of AIG's plans to pay millions of dollars to members of the Financial Products subsidiary through its Financial Products Retention Plan. Financial Products was, of course, the division of AIG that led to its meltdown and the huge infusion of taxpayer funds to save the firm. Previously, AIG had agreed at our request to make no payments out of its $600 million Financial Products deferred compensation pool.
We have requested the list of individuals who are to receive payments under this retention plan, as well as their positions at the firm, and it is surprising that you have yet to provide this information. Covering up the details of these payments breeds further cynicism and distrust in our already shaken financial system.
In addition, we also now request a description of each individual's job description and performance at AIG Financial Products. Please also provide whatever contracts you now claim obligate you to make these payments. Moreover, you should immediately provide us with a list of who negotiated these contracts and who developed this retention plan so we can begin to investigate the circumstances surrounding these questionable bonus arrangements. Finally, we demand an immediate status report as to whether the payments under the retention plan have been made.
We need this information immediately in order to investigate and determine:
(l) whether any of the individuals receiving such payments were involved in the conduct that led to AIG's demise and subsequent bailout;
(2) whether, as you claim, such individuals are truly required to unwind AIG Financial Product's positions;
(3) whether such contracts may be unenforceable for fraud or other reasons; and
(4) whether any of the retention payments may be considered fraudulent conveyances under New York law.
Taxpayers of this country are now supporting AIG, and they deserve at the very least to know how their money is being spent. And we owe it to the taxpayers to take every possible action to stop unwarranted bonus payments to those who caused the AIG meltdown in the first place.
If you do not provide this information by 4:00 p.m. today, we will issue subpoenas and seek, if necessary, to enforce compliance in court.
Andrew M. Cuomo
Attorney General of the State of New York
cc: AIG Board of Directors
^
What's funny about this was the UAW was beaten with the "well if the big three go bankrupt you get nothing so you have to deal with this".
Kinda like "well if AIG and CITI go bankrupt you get squat so you will have to............. oh wait!
If you read what I wrote - which was in the above quotation they you so helpfully cut out - you'd see that everything I said is absolutely backed up.
QEDMF xbl: PantsB G+
Remember, the rules are different for anything that's white collar.
Especially if those white collar workers are friends with the Treasury Secretary.
Capitalism is more fun when it's practiced with pitchforks and torches.
How many private policemen can 450 million dollars buy?
Depends on the criteria for awarding the bonus. It's perfectly possible for individuals to do their jobs well, and meet the goals asked of them and for the company to still do badly.
Are they breathing? Success!
Apparently all of them did!
Think of these as retention bonuses. You agree to give your "talent" a large lump sum of money so they won't leave.
So, all they needed to do was stick around? How is it that AIG does not owe them this money then?
yeah
that might cause the company to fail
I kind of don't remember when anyone suggested docking UAW workers retroactively. These employees are already losing their money going forward.
Because AIG had to go begging to the government to stay afloat, so now we get to make some rules as to where that money goes?
I refer you to
Seriously, the AIG CEO was warning about a brain drain if they didn't continue paying bonuses. If that did happen, would we fucking notice? We need to get all of those fuckers the hell out of the industry, not retain them. They suck at their jobs.
Yeah, this right here. AIG and its employees are now welfare queens, so I'm perfectly fine dictating the money owed to its employees. ESPECIALLY since just about by definition, none of the people receiving these bonuses are working class. If they can make more money by quitting and working somewhere else, I'm all for it and suggest they do so.
It's a retention bonus. Typically given to the brains of a unit or people with important knowledge of the company. If you stick around past date X you get a bonus, it's in your contract so they know you won't leave before said date.
AIG does owe them this money, nobody disputes that. The issue is that the government could have stipulated the money was for fixing their financial mess and not for paying bonuses. But we were told we can't put any strings on the money. So they took the money and gave out the bonuses and the company is still royally fucked.
LOL
I think it would be completely fair to ask the individuals to whom AIG owes this "bonus" pay to renegotiate for their long term interest. If not, the company for which they work may no longer receive funds and they may be looking for a new job. That seems like the proper analogy to what was said to the labor union, yes?
The problem is that was their option last year. They could have quit, and gone looking for employment at firms that were not failing. However AIG offered them more money to stay, to compensate them for the fact that they might have greater difficulty finding work later.
They upheld their end of the bargain. Pay them and move on.
QEDMF xbl: PantsB G+
That's true. There are plenty of very good employees at AIG who turned nice profits. They are getting bonuses they deserve. Plus, a lot of people who screwed things up have expertise we need to fix our financial markets. We can't purge everyone we don't like without thinking about the unintended consequences.
This is what I mean when I say that I'm worried about populist outrage actually hurting us. We cannot, as Obama says, govern from anger. Our anger is justified, yes, but it doesn't help us make the policies necessary to fix things.
AIG is broke, they don't have the money to pay them.
AIG went broke, and so now we the people are paying their bonuses because if we don't AIG will lose talent and fail. o_O
Yes. Limed for truth.
Then AIG promised money that is honestly, not theirs to give. They are perfectly free to quit now, and take the salary they have been paid.
I'm sorry, I think the free-market seats are over there... can I see your tickets please?
A Citi building to bombed in Athens recently, so it's not that far fetched now.