Right Idea… Wrong Execution

Posted: March 19, 2009 in Technology and Business
I can’t think of anything more offensive to shareholders than giving bonuses to people in a failed company.
 
And that’s what AIG was when the U.S. tax payer stepped in as the investor of last resort and rescued AIG.
 
It’s a crock — no, a crime — that bonuses would even be considered.
Few people realize that we’re not just talking about $165 million in bonuses — but $1.2 billion worth! — the $165 million is only the amount due last Sunday.
 
So, it’s even worse than people think.
 
Reading between the lines, it seems that AIG’s CEO is saying that if he didn’t agree to these bonuses, he would have lost his braintrust.
 
Boy, he must feel foolish hearing himself say that… that’s what AIG needs to do… get rid of the braintrust that got them (us) into this mess.
 
Maybe he was afraid he couldn’t hire people at the "reduced" salary of $250K.  If so, wake up, we’re in a different world… there’s a city the size of New York filled with financial types that would jump at such a job these days.
 
So I love EVERYTHING about going after these bonuses… EXCEPT the way they are going after these bonuses… with special "taxes."
 
Uhm… wasn’t that what the Boston Tea Party was all about?
 
C’mon, we own the damn company.  Just declare eminent domain.  Or better yet, just say "no." 
 
Whatever you do — AND YOU HAVE TO DO SOMETHING — don’t unwind 200+ years of effort.
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Comments
  1. Unknown says:

    Any thoughts on GM? I thought the company has been badly managed for many years now and should go into bankruptcy at a minimum. The push for a bailout of them gets to me…. Comments?

  2. Royal Farros says:

    I totally agree. I think of all the hysterical hype, the "3 million people will be out of work!" from the auto companies is the worst. The airline companies have been in & out of bankruptcy for years and that doesn\’t seem to have affected service. Propping up bad companies is just bad business. The bridge they put together a few months ago seemed like a farce… at least with banks, I can see how taxpayer investment might be repaid over time… I don\’t feel as confident with the automakers… when they bridged the car companies money a few months ago, they actually said, "this is a secured loan, we can demand repayment at any time"… or something like that… huh? didn\’t take a rocket scientist to realize there would be no money left by the time repayment was demanded.