American International Group (AIG), the insurance corporation at the heart of the world financial meltdown, got the US government to bail them out to the tune of about US$170 billion in taxpayer money, who paid out a large chunk of that to other financial instituions, and who just reported a US$61.7 billion fourth quarter loss, is in the news for the wrong reasons again. This time, they are paying out bonuses to the very same executives who got them, and the rest of the world, into this mess in the first place.
You read that right. They're getting bonuses in the region of US$165 million for getting AIG, and by extension their investors and now, almost everyone else, into a chasm of quick-sinking manure. President Obama got this right when he asked "How do they justify this outrage to the taxpayers who are keeping the company afloat?". All the reactions in that story is pretty much justified. It flies in the face of reason and logic that you get rewarded for reckless greed when people are losing their jobs and comapnies are shutting down. I wonder why on earth do they still have a job?
Leaving aside the morallity of this (since I don't care much for morals, and since we're talking about bankers here), there is no reason to reward failure of this scale. However, the news also mentioned that these bonuses were legally binding; which means that either they have hoodwinked whoever was in charge at the time to approve the bonuses way ahead of time, or someone in charge of this litte piece of insanity failed to engage his brain when he approved it. Quite possibly, both these factors were in play.
Recklessness, blind greed, stupidity and insensitivity. That's quite enough to fill any reasonable man or woman with anger. People want these payouts stopped, and rightly so; unfortunately, I don't think that will happen.
Despite all that anger, I don't think Senator Grassley's reaction was too appropriate. Thanks for the laugh Senator, but no thanks.
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