From Alter Net:
Had AIG gone into chapter 11 bankruptcy or been liquidated, as it would have without government aid, no bonuses would ever be paid (they would have had a lower priority under bankruptcy law that AIG's debts to other creditors); indeed, AIG's executives would have long ago been on the street. And any mention of the word "talent" in the same sentence as "AIG" or "credit default swaps" would be laughable if laughing weren't already so expensive.
........... government helplessness in the face of massive taxpayer commitments illustrates better than anything to date why the government should take over any institution that's "too big to fail" and which has cost taxpayers dearly. Such institutions are no longer within the capitalist system because they are no longer accountable to the market. To whom should they be accountable? As long as taxpayers effectively own a large portion of them, they should be accountable to the government.
And this from Reuters:
CITIGROUP CEO gets $10.8M.
By Jonathan Stempel and Dan Wilchins
NEW YORK (Reuters) - Citigroup Inc (C.N) awarded Chief Executive Vikram Pandit $10.82 million of compensation in 2008, a year in which the bank required two government rescues totaling more than $45 billion.
Citigroup also said it had nominated four new independent directors to help it recover following the government bailouts.
About $7.73 million of Pandit's total compensation was a sign-on bonus awarded in January 2008, a month after he became CEO, succeeding Charles Prince.
Wall Street compensation has come under intense scrutiny, especially at banks that have received taxpayer money from the government's Troubled Asset Relief Program. Citigroup has received $45 billion of TARP money.
Late last month, the government agreed to a bailout that could give it a 36 percent stake in the bank. The government is also sharing in losses on $300.8 billion of troubled Citigroup assets.
Compensation for the 52-year-old Pandit was slightly higher than the $9.96 million that Bank of America Corp (BAC.N), which has also received $45 billion of TARP money, awarded its CEO, Kenneth Lewis.New York Attorney General Andrew Cuomo is investigating $3.62 billion of bonuses awarded late last year to Merrill Lynch & Co executives, just before the company was sold to Bank of America and posted a $15.84 billion fourth-quarter loss.
And a little more via Alter Net:
AIG Scrutiny: Basic Questions for Media and Congress Alike
Posted by Christy Hardin Smith, Firedoglake on March 16, 2009 at 8:02 AM.
You know it's bad when even the WSJ's headline screeches about growing wrath toward AIG's bonuses.
On This Week, Robert Kuttner made the point that auto workers take pay cuts while the big guys fund themselves bonuses -- watch and see if it doesn't piss you off, too.
Retention bonuses for companies on the brink of financial ruin are not new.
KMart paid them when they filed restructuring bankruptcy a few years ago to keep upper management who knew how to run supplier networks or other crucial components from jumping to a healthier business. Under certain stressed conditions, they can make good business sense.
What is most horrifying about this is how little the government appears to have known before doling out the next ladle of public bailout fundage: Did treasury know about these bonuses before doling out TARP monies? How much did they know? We have no idea at this point.
This all has to stop, now. The American taxpayer has been forced into funding these failing corporations. We didn't cause them to fail, corporate mismanagement and personal greed is the reason they failed.
The conservatard Rethuglicans say it would be socialism to nationalize these entities. These are the same people who said that welfare for the poor was socialism. Well what the fuck is it when the same taxpayer money is used to prop up failing banks and insurance companies!?! it's corporate fucking welfare, that's all it is! I am fed up with all the taxpayer dollars being shelled out to line the pockets of the greedy rich.
Enough of these get rich quick schemes! People like me have to work for their money, and I'm tired of mine being handed to some rich bastard just because they think they deserve it!
Any bank, or insuarance company who has received taxpayer money to bail out their failure should be nationalized imediately! Let the stockholders take the lose, they were in it only to make lots of money off other people's work anyway.