AIG: Kill Me Now (In the Metaphorical Sense)

Yesterday we learned that AIG handed out/plans to hand out $165 million in bonuses to its financial products branch, the branch of its company responsible for the acquisition and trade of the toxic assets that plunged our economy into turmoil. As of today we learned that AIG plans to ask the recipients of its bonuses to give back half of the money they are due. (What a sweet, sweet gesture. How generous.) Edward Liddy, AIG’s CEO who at the request of the US government came out of retirement in exchange for a $1 per year salary, claims that the bonuses are necessary (1) to retain AIG’s best and brightest and (2) because AIG contracted to give them out long before the recession hit.

This situation bothers me to no end. First, how in the world can AIG justify giving bonuses to the men and women responsible for blowing a hole in the side of our sinking-ship economy? And, to make matters worse, how can AIG justify using taxpayer money? Second, if it’s as Barney Frank (NY Congressman) says – the government owns 80% of all AIG stock – how could Timothy Geithner & Co. have let this go down? Weren’t they in a position not only as the executives responsible for monitoring the federal stimulus packages but also as the acting owners of AIG to intervene? Finally, where was Ben Bernanke, our fearless Federal Reserve Chairman? If Liddy is right and Geithner knew about the bonuses the entire time, wouldn’t it have made sense to say something to someone? Either warn the President or warn the public so when the news hit stocks would not plummet again?

What is going on in Washington? The government is handing taxpayer money to crooks – companies who so negligently handled money in the past that they single-handedly drove the world’s greatest economy into a meltdown. Wouldn’t common sense dictate that we watch these people? Are our Congressmen and women so inept, so desperate to get voted out of office, or so in love with Barrack Obama that when they passed the various stimulus packages they just closed there eyes and let the President/special interest groups dictate the terms of the packages?

I am no Washington insider and I am certainly no economist, but it seems to me like everyone thinks that if we throw enough money at something, it will go where it needs to go and fix the economy. False. We are where we are because of greed and laziness. Until we reprogram the moral compasses of financiers and bankers and implement actual Congressional regulation that disregards special interests and pork we won’t get anywhere.