Liberal Commentators Disappointed with, GOP Pounces Upon White House Aides' Remarks on AIG Bonuses

We are really fighting over 11 trillion dollar deficit legacy Bush and his supporters left all Americans. The cost to fix the mess is included and I bet its a lot higher. War wounded etc.

I find the demagoguery that I hear from the Democrats and from many of the people on this site to be positively frightening.

In business it is quite common to have bonus provisions in employment contracts that if an individual can provide certain benefits to the company (increased profits, more business, reduced costs, etc) that they are entitled to specified bonus money. This is quite different from the common end-of-the-year discretionary bonus, which is given out if the employee has been a useful worker and if the company is doing well; rather it is part of the employee's basic compensation package. Some might ask if an employee at a company that's losing money should be granted such a contract, but in fact one or a few talented employees might well be able to turn such a company around or at least prevent even worse losses. Such people can be worth rubies - is it so terrible to compensate them handsomely? (speaking strictly in generalities of course, obviously the specifics at AIG may be another matter).

The bonuses paid at AIG were contract bonuses - perform X, and you will receive Y. Under the normal course of events, AIG would be LEGALLY OBLIGATED to pay the bonus if the employee performed as requested. We might argue whether it was wise of them to make the contract given their circumstances, but that doesn't change the obligation. There are a number of cases where such a contract could be abrogated: For example, contracts to do something illegal are always void. Or if a company enters the protection of the bankruptcy court, then their previous contracts may be set aside by the judge. The former might apply to AIG if it can be shown that the contracts were part of a collusion amongst management to loot the company (ie, commit fraud against AIG investors) - but note that these contracts were in place well before the bailout was even under discussion, so the fact that AIG later received bailout money is a red herring.

Normally, if a company is bought out by another company, the contracts made by the first company are still valid - you are purchasing their LIABILITIES as well as their ASSETS. Again, the only exception is when we are talking about something like bankruptcy, where the courts may set aside some or all of the company's contracts.

By analogy with bankruptcy protection, it would have been entirely reasonable for provision to have been made in the bailout bills allowing the abrogation of such contracts by companies receiving money (possibly if the amount(s) of the bonus and/or the bailout were over a certain dollar figure, and/or only after review by an arbitrator). This was not done, for what reason I cannot fathom. It is, at the very least, extremely hypocritical to then come back and demonize both the company and the individuals and to try to change the rules after the fact. It is even more dangerous to use tax law in this way - we have not even established that the individuals in question acted inappropriately, yet we are penalizing them for what their company did.

It is difficult to avoid the suspicion that the entire thing is a manufactured crisis, whose ultimate aim is to allow the Government to massively increase their control not merely of the companies who were bailed out, but of every detail of our economic lives. I have no connection with AIG or any of the other Wall Street companies, but I greatly fear for the future of our country. De Toqueville is supposed to have said that our downfall as a nation would likely come about when the people found a way to vote themselves benefits from the public purse, and this seems to be coming true before our very eyes.

This crisis will steel the North American character. Let the suffering and adversity come. Let it pummel us. We'll be better for it in the end.

This continent has been too rich for too long. Wealth has ruined a great people.

Plato was right: It's best to be neither poor nor rich. For a people to be great, it must be perennially hungry and yet able to feed itself through ingenious labor.

From Bush to Rush, now THERE are some fantastic economic alternatives like????? what????

Taxes are evil, but some Americans (myself included) need to go spend some time in a country that lacks the natural resources to even equip its citizens with a taxable income.

Relatively speaking, are there really any poor people in America?

You folks have no idea what bad really looks like. We are a pampered, fat, soft, weak people and if it really gets bad we'll probably starve not being able to figure out how to feed ourselves. America is so blessed in its richness that we can't even see the forest through the trees. As you pound away angrily cursing the politicians on your computer with broadband access and sip on a beer while your wife and kids watch TV with the lights on and it is warm, there are people in Congo who are getting hacked to death by other tribes as they hide in 95 degree heat and grass huts. Sniveling befits us, and our weakness is our extreme wealth and lack of anything that even approaches adversity. Wake up America!

GIVE ACT

H.R. 1388 The Generations Invigorating Volunteerism and Education (GIVE) Act
House expected to vote Tuesday, March 17

From the CONGRESSIONAL BUDGET OFFICE
COST ESTIMATE:

Assuming appropriation of the estimated amounts, CBO estimates that implementing the bill would cost $481 million in 2010 and about $6 billion over the 2010-2014 period.

CBO estimates that over the 2010-2014 period another $2.4 billion
would be needed to fund education awards for AmeriCorps participants. Assuming the appropriation of those sums, CBO estimates outlays would increase by $0.5 billion over the five-year period (with significant additional outlays in subsequent years).
CBO also estimates that over the 2010-2014 period, the bill would authorize the appropriation of funds for:

• Administrative expenses, including support to state service commissions and
evaluation of programs ($0.6 billion),
• Various demonstration programs ($0.2 billion),
• Training and technical assistance programs ($150 million), and
• A new Congressional Commission on Civic Service ($1 million).

In total, CBO estimates that outlays would rise by $0.8 billion over the next five years, assuming appropriation of the estimated amounts.

Programs funded under NCSA and DVSA received appropriations of $1.1 billion for fiscal year 2009, including $200 million in funding from the American Recovery and Reinvestment Act of 2009.

This seems a pretty steep price to pay for "volunteerism." But, what the heck, everybody knows taxpayers' pockets are bottomless. We've been known to give till it hurts.

We're stuck with this clown for for years.

Obama administration special envoy Richard Holbooke was on the AIG Board of Directors. I wonder if he approved these bonuses. Who knows- maybe he got a bonus for keeping quiet.

AIG is a topic talked about in my circles, while we struggle to make ends meet these clowns are living the high life on our tax backs.

"Apparently Bush approved the bonuses back in APRIL and left them as a POISON PILL for Obama."
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Not likely. The primaries weren't even finished in April of 2008.

These two clowns are totally lost when they can't use Rush as a distraction
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I'd take these two clowns over the Bush administration any day.

'Apparently Bush approved the bonuses back in APRIL and left them as a POISON PILL for Obama. This is already being played as "the first genuine full-blown crisis of the Obama administration" and pundits are calling for Obama's picks -- particularly Geithner -- to be fired.
This stinks of a manufactured crisis, one designed specifically to force Obama to start over and make even more concessions in back-room negotiations involving much "bipartisanship"

These two clowns are totally lost when they can't use Rush as a distraction--to keep America's eye off of the turmoil in the White House.

"So a group should be judged by the actions of individuals in the group? "

Sure. What's the difference between Acorn and American Insurance Group (AIG)?

We have witness the government run riot and reckless for so long....this isn't a surprise to Me....however, this is the Norm for these Big Companies....so why Is it such a surprise. Our government officials has been in their pockets for decades..So they do what they do. But I know that President Obama knows what has been and is happening, and I am confident this was the change he was talking about...Government in the pockets of AIG and controlling our country....and the working Americans are given "trickled-down" peanuts and remain poorer by the decades. I think the vast majority of people know that it will take more of these "scandals" to truly allow the American people to know the truth. This is another 'game' that has been played in Washington...and let us not forget that the "Stimulus" was given to AIG in September, and let it be known that the "claus" was already written in it. Also, wasn't the 'other side" slamming this President on his suggesting that the salaries and bonuses be regulated if that Bank or any bailout segment got money from us. He was called a Communist, Socialist, Marxist by them. Uh, this sounds "flakey
at best/

"Tea parties are popping up, not because of the bonuses, because we are SICK and TIRED of working our butts off to succeed in this world and keep our promises"

Teabaggers for the rich!

"And Tapper: I caught fox news at around 1 pm and Major whatever his name is said that the bill to tax the bonuses at 90 percent had failed, that at the last minute around 80 votes had flipped to nay...now I hear it passed...what happened?"

The House approved the bill

Approved 328 to 93, the bill would slap a 90 percent tax on the bonuses of any employee making more than $250,000 at any company that received federal bailout money.

The Senate voice vote to approve a similar bill failed when Sen Kyl objected.

It now must be debated.

The lesson from this? Don't listen to FoxNews.

13 Banks and private firms that received billions in taxpayer dollars owe the IRS more than $200 MILLION dollars in overdue federal taxes.

This tells me more about our incompetent government, than it does these companies.

"Government, step aside and let us live our lives in peace."

That's what you've been saying for the last 8 years. As far as most of us can tell we didn't get peace of any kind.