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Obama Will Try to Block AIG Bonuses — Are You On Board?

President Obama has ordered Treasury Secretary Timothy Geithner to do what he can to block millions of dollars in bonuses to AIG executives. The insurance giant has received billions in taxpayer money, but still plans to pay out $165 million to executives and traders working at the failing company.

Taxpayers have footed over $175 billion to AIG, which is now 80 percent owned by the government. AIG says it's contractually obligated to pay the bonuses, but the Obama administration will make its case to the contrary.

Today Obama said, "All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multimillion-dollar bonuses."

Trying to appease public outrage over abuses is behind Obama's move. Will it make you feel better about the bailout?


booglass booglass 8 years
As much as I may think these a#@hats don't deserve a dime of bonus money, it is an existing contract. Going back may actually create the opportunity for the execs to sue for the unpaid monies. This would, of course, mean litigation costs making AIG expend more money. Perhaps at this point, the gov't/politicians needs to simply live with the consequence of their knee-jerk policy. Let the voters express how they feel about this election time and perhaps they will think more critically about just giving money away next time.
chatondeneige chatondeneige 8 years
Hmm, this is exactly why anyone with a brain thought that the TARP money shouldn't be without strings. But it is their money now, and because it was without strings, Obama can't really add strings now. I'd love for him to stop this, but... that's kind of a fascist attitude.
ccpdm ccpdm 8 years
Aimlessly Indulgent Goofballs.
janneth janneth 8 years
Archetypal Idiotic Greed. AIG
Grandpa Grandpa 8 years
If you remember the architect of Tarp 1, as reported at the time in the NY times, it was our current irreplaceable must have to save the world from ruin Secretary of the Treasury
beavis667 beavis667 8 years
"Actually, no. Bonuses are awarded based on an incentive (ie: number of new accounts, or number of referrals). Those incentives don't always bring in money, but you have to pay them because that is what was expected as an award." To Dave's point, all bonuses aren't created equally. We don't know what kind of bonuses these are...but given how BHO and the press are villifying AIG, I'm guessing they aren't surplus bonuses, but performance/merit bonuses. Perhaps some of those receiving the bonus had nothing to do with credit default swaps. Perhaps they weren't the salesmen that sold them. We just don't know. But the emotional, reactionary mob is the same kind of mentality that led to the bailouts in the first place.
beavis667 beavis667 8 years
I don't want to join the angry mob just yet. I was part of the angry mob who didn't want the ill advised, rushed bailout in the first place. The bailout (TARP) money that AIG received was pretty much without strings. There was nothing in any of the 2 pages of wording that regulated how the companies ran after they received funds. The business needs to run, top performers need to be rewarded and retained just like any business. If Pelosi/Reid/Bush had spent more time on the initial bailout, maybe this wouldn't be a problem. Now the government wants to go in retroactively to companies who received bailout money and tell them what they should and shouldn't do. I don't think that's right. It's just as wrong as these outfits getting our tax dollars. The government is trying to tell Wells Fargo not to hand out bonuses, give regular workers raises, and sponsor golf tournaments. Wells Fargo never asked for a bailout, but they took a mandatory one along with 8 other banks last Oct. It's all wrong. Bush started a terrible policy and Obama is continuing it.
Ginger Ginger 8 years
Interesting report tonight on who AIG gave money to already... Billions went to different foreign banks, as well as some of the US banks who already got money directly from the US bailouts. I've seen businesses who were around 5-20 years in my neighborhood close this year, no bailouts, so I haven't much sympathy here. Also, I've read that if AIG had gone under, no bonuses would be paid. Technically they did go under (sort of) and were bought by US tax payers, who own 80% of the company now.
ccpdm ccpdm 8 years
It took me about one minute to cancel my AIG coverage when this first came out. I wonder how many other customers they've lost because of it? :ponder:
genesisrocks genesisrocks 8 years
Heck yeah he should try to block those bonuses! Like they really need that money as their company's failing.
Roarman Roarman 8 years
I think bonuses mean different things in different businesses/industries. I work for a small company and we get a bonus if there is a surplus at the end of the year. It is the owners way of thanking us for our hard work through out the year that contributed to their making money. If there was no extra money left, we would not get a bonus. Also, the owners would never take huge bonuses and not share them with the employees. The bottom line with AIG is if you took money from the government to stay afloat, you should not be handing out bonuses. PERIOD.
UnDave35 UnDave35 8 years
"Aren't bonuses given when the company has a surplus of money?" Actually, no. Bonuses are awarded based on an incentive (ie: number of new accounts, or number of referrals). Those incentives don't always bring in money, but you have to pay them because that is what was expected as an award.
kurniakasih kurniakasih 8 years
Frak that. Without the help of the bail out, they probably won't be existing today which means: none of them will get any bonus anyway. And how about the union workers for GM and etc taking cut in pays, hmmm..their contracts said they should be getting an 'A' amount of pay, but they're 'forced' (or have accepted) to take a cut in their pay. If they still get their bonuses, how about since the US people own supposedly 80% of this company...we just fire those people? What...80% doesn't have a say in who's staying, who's going? And aren't these people the ones who run that company to the ground? Why are they accepting bonus for bad practice? Sorry for the rant, a little bit in a foul mood today :p
lickety-split lickety-split 8 years
hell yes!!!!! those bums deserve a kick to the curb! :mob:
starangel82 starangel82 8 years
I read some on another site AIG is claiming they are contractually obligated to give the bonuses. I always thought bonuses were just that: a bonus. A reward for hard work. Not a contractual obligation. My company doesn't get bonuses when our financials are bad. AIG should not get their bonuses... especially using bailout money.
flutterpie flutterpie 8 years
to me it seems like aig knew they were tanking even after the bailout and is just using the money to create a nest egg for those who are losing their jobs
nyaradzom2001 nyaradzom2001 8 years
It's amazing that thy have probably laid off employees citing the financial situation but the big fish who are running the company into the crapper still feel entitled to million dollar bonuses. People have lost homes and are suffering yet they are still living high on the hog. They are lucky rich people don't get dragged out and guillotined because they would be the first to go.
janneth janneth 8 years
The nerve!!!
janneth janneth 8 years
Bonuses come out of profits or shareholders pockets. When the profits dried up, byebye bonuses. They can't come out of bailout money.
hypnoticmix hypnoticmix 8 years
*should'nt. There I go typing too fast again.
hypnoticmix hypnoticmix 8 years
I'm on board with thinking they should get any bonuses, but can (he) stop them. It may be just a matter of calling them out in front of the public to make them have second thoughts about it but I wonder how he is going to do anything to stop them unless there was a written requirment in the deal not to use the money for that.
amybdk amybdk 8 years
I just don't understand how "AIG says it's contractually obligated to pay the bonuses" when they weren't making money in the first place. Aren't bonuses given when the company has a surplus of money?
Carrie-Sue Carrie-Sue 8 years
Alright, but who threw the money at them without making stipulations as to how it should be used - and no, I'm not making excuses for what they did. nya, you're right: totally shameless.
Roarman Roarman 8 years
This is really bothersome. They should be forced to pay it back.
nyaradzom2001 nyaradzom2001 8 years
AIG is shameless, just shameless. First the retreat then this??? Take away everything, everything I tell you.
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