Obama will try to stop AIG from using bailout money for $165 million in bonuses

[Hemidakota]

My understanding was that AIG basically was the "insurer's insurer"--it underwrote insurance policies on all the mortgage and other securities deals that went south. AIG might legitimately have been the one financial entity that really was "too big to fail".

But then, maybe I just believe that because the AIG bailout happened on Bush's watch.

We have our government pension tied to this company. This is sad to note this issue.

[Islander]

The dumb leading the blind....go figure.

[Moksha]

My understanding was that AIG basically was the "insurer's insurer"--it underwrote insurance policies on all the mortgage and other securities deals that went south.

Yes, they were able to insure that bad loans happened and that their inevitable failure would be really big. Should the chutzpah for this monumental blunder be rewarded with bonuses or should indictments be handed down?

[Fiannan]

Kinda interesting considering the spin doctors in the White House:

Obama Officials Sought To Keep AIG Bonuses: Dodd - Financials * US * News * Story - CNBC.com

and...

WASHINGTON (AP) — Obama administration special envoy Richard Holbooke was on the American International Group Inc. board of directors in early 2008 when the insurance company locked in the bonuses now stoking national outrage. Holbrooke, a veteran diplomat who is now the administration's point man on Pakistan and Afghanistan, served on the board between 2001 and mid-2008.

During that period, AIG undertook the aggressive investment strategies that led to a near-collapse and forced a multibillion-dollar federal bailout.

President Barack Obama has insisted his administration was not responsible for AIG's financial woes, and a White House spokesman said Thursday that Holbrooke was unaware of AIG's decision to award retention bonuses to key employees.

"Mr. Holbrooke had nothing to do with and knew nothing about the bonuses," spokesman Tommy Vietor said.

Close to $165 million in bonus money was paid last weekend.

It remains unclear whether AIG's decision to grant the bonuses ever came before the board. A Holbrooke spokesman declined comment, referring calls to the White House.

The Associated Press: Obama envoy Holbrooke served on AIG's board

Change!

[FunkyTown]

Kinda interesting considering the spin doctors in the White House:

Obama Officials Sought To Keep AIG Bonuses: Dodd - Financials * US * News * Story - CNBC.com

and...

The Associated Press: Obama envoy Holbrooke served on AIG's board

Change!

Bush had Iraq as his albatross, Obama looks like he's going to have this Stimulus package as his albatross. Frankly, everyone knows that this sort of thing is going to happen. The companies are contractually obligated to pay the bonuses they promised to most of these people and they aren't going to give up their bonuses for the good of the country.

This is one of the reasons this stimulus package is flat-out wrong. It's going to cost every American man, woman and child thousands of dollars to provide these. If these companies created unsustainable bonus structures, they should fall by the wayside. If they are selling products aren't buying, they should fall by the wayside.

It will cause issues, but that's what capitalism does. Trying to hold on to obsolete business standards and practices just results in good money being thrown after bad. Sadly, people are too selfish to see that hard times are ahead and, because of that, worse times will be coming. It saddens me that a man with real dreams, who honestly wants to change America(And I believe Obama believes in what he's doing, despite what others on here might think) for the better is falling prey to the ignorance and selfishness of Wall Street. He's a good man, but he needs to know who his friends are and who are no friends of America.

He reminds me of two great Presidents in the past: Roosevelt and Coolidge. He has the ability to speak to Middle Class America like Coolidge without the Laissez-Faire capitalism of that man. He has the New Dealism mentality of FDR. I agree with everything he has done so far, with the exception of this whopper of a bad idea: The Stimulus package.

Actually, here's a question: If the stimulus package fails, how should the US go about recovering? Is there a way to rebuild an economy from the ground up without resorting to the past?

[beefche]

I'm blaming Congress more than Pres. Obama. THEY are the ones who pushed this stimulus bill thru so quickly (of course at the urging of the White House). THEY are the ones who placed the statement in the bill which allowed these bonuses. THEY are the ones who are now passing laws to tax these bonuses out of existence....which is REALLY scary to me. They are gaining more power and more power allows for more corruption. I think the Democratic run Congress thinks they have a pass now that the White House is Democrat. I was disappointed that more senators (Rep OR Dem) didn't vote down this bonus taxing legislation....at least to give time to look it over for possible problems.

[Moksha]

I'm blaming Congress more than Pres. Obama.

Yes, but in defense of Congress, they forgot they were dealing with business executives who of course would seek to line their pockets with this loot. In Congress's innocence they forgot about the story of the fox and the scorpion crossing the stream.

[Just_A_Guy]

Yes, but in defense of Congress, they forgot they were dealing with business executives who of course would seek to line their pockets with this loot. In Congress's innocence they forgot about the story of the fox and the scorpion crossing the stream.

They knew exactly who they were dealing with. Campaign donors.

[Moksha]

They knew exactly who they were dealing with. Campaign donors.

Yes, they would remember that.

[Madriglace]

Yes, but in defense of Congress, they forgot they were dealing with business executives who of course would seek to line their pockets with this loot. In Congress's innocence they forgot about the story of the fox and the scorpion crossing the stream.

Congress innocence ... is that like military intelligence????

[Palerider]

They all knew there were bonuses included.....Obama can say he didn't know.....he was part of the Senate and had to know....they all knew it

[Just_A_Guy]

Dear AIG: I Quit

DEAR Mr. Liddy,

It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:

I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.

After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.

I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.

[a-train]

Is there a way to rebuild an economy from the ground up without resorting to the past?

What 'past'? What are we talking about?

There is only one way to build an economy: production.

-a-train

[a-train]

Hey, if you've had enough of Congress handing out money to their cronies, support Ron Paul and the Campaign for Liberty.

-a-train

[FunkyTown]

What 'past'? What are we talking about?

There is only one way to build an economy: production.

-a-train

I respectfully disagree. An economy is an almost living thing. You can no more have an effective economy through overproduction than you can through massive payouts.

A bartering system is an example of an economy, for instance, as is a capitalist economy. There have also been economic systems created based upon man-hours worked or a valuation based system.

The issue with our current economic model is that it's a 0 sum game. I'll give you an example:

If a country had $1 to split amongst it's government, people and corporations and it started with this split: $.50 for the people, $.25 for the Government and $.25 for the Corporations, here's how it would work:

The People work enough man-hours to garner $.20 in wages. $.05 of that goes to the government. Now, we're at $.70/$.05/$.25.

The Government hires people and companies, spending $.05 on people and $.10 on roadways/health care/education, etc. Now we're at $.75/$.15/$.10

The people then spend their funds, making certain to save 10% on a rainy day. 10% of this is taxed and sent to the government. This now works out to be $.07/$.71/$.22

Now, we're at an impasse: Unless wages skyrocket, the people can no longer spend as much. This will result in companies, which developed quickly to deal with demand, to be bloated and will result in layoffs. This will in turn reduce the workforce and available funds. The problem with our current economic system is that each sector can only grow at the expense of another sector.

There are some exceptions to this, of course: My proposition was a closed economy in one country. By preying upon another country, you can reduce -their- economy and keep them perpetually in poverty. By using 'economic trickery' like increasing production(See the bubble economy problem) to decrease prices, you can effectively allow the smaller and smaller funds available to one particular group(Most likely the people) to hold their own in worth until production can no longer be increased.

The issue is that groups that are increasing do so only at the expense of living vampire-like on another group. If any group fails to grow, the whole system becomes stressed and eventually collapses.

[Madriglace]

I saw a piece on a Seattle station the other night where they said that the a state got 1.5 mil of pork from the stimulus package to research why pigs stink .... what???? They had an entire list but that one was the most rediculous ... but not by much ... so I remembered it.

[Elphaba]

I saw a piece on a Seattle station the other night where they said that the a state got 1.5 mil of pork from the stimulus package to research why pigs stink .... what???? They had an entire list but that one was the most rediculous ... but not by much ... so I remembered it.

If it doesn't make sense to you, google it!

What's the big deal about pig odor? - War Room - Salon.com

Of course, if any of these people actually bothered to go back and do a little research about what they were discussing, they'd know it's not really funny after all. Pig odor is more than just a smell; it's dangerous stuff that cause serious health problems, both physical and mental, in people. It can even contribute to asthma in children.

One study of people living near large hog farms in North Carolina, for instance, concluded "persons exposed to odors from intensive hog operations experienced 'more tension, more depression, more anger, more fatigue and more confusion' than a group of unexposed persons."

A 1998 workshop about the subject, held at Duke University and featuring 50 experts, came to the conclusion that "Our current state of knowledge clearly suggests that it is possible for odorous emissions from animal operations, wastewater treatment, and recycling of biosolids to have an impact on physical health. The most frequently reported symptoms attributed to odors include eye, nose, and throat irritation, headache, nausea, hoarseness, cough, nasal congestion, palpitations, shortness of breath, stress, drowsiness, and alterations of mood."

And here are the conclusions from one study, from Iowa no less, that compared people living near pig farms (CAFOs) with a control group not exposed to livestock odor:

[N]eighbors of the swine operation reported significantly higher rates of four clusters of symptoms previously documented to represent toxic or inflammatory effects of the respiratory tract among confinement workers. One cluster reported by swine CAFO neighbors includes symptoms such as coughing, sputum production, breath shortness, chest tightness, and wheezing. A second cluster includes symptoms of nausea, weakness, and feelings of dizziness. A third cluster consists of headaches and plugged ears, while a fourth cluster encompassed symptoms of a runny nose, scratchy throat, and burning eyes. Most notable is the fact that for the first time the configuration of respiratory symptoms among neighbors was documented to be consistent with the scientifically well-established pattern of respiratory health problems among swine confinement workers discussed previously.

It turns out it's not "pork" after all.

Elphaba

[Elphaba]

165 mill is small pittance compared to where all the rest of the money is going. This is a diversion "Look at me - I am fighting so that your money will not be wasted". I want to know what happened to the rest of the money.

Is that what it is?

Thank you for telling me.

Elphaba

[Just_A_Guy]

Per the Morgan Stanley CEO:

I had a hedge fund say to me, 'I can hire anyone I want from you and Goldman'.