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expatriate's picture
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AIG

Before I go any further, I want to say that IMO the idea of executives getting bonuses when they ran their businesses into the ground is abhorrent.

But the real test of principle is holding to the principle when it's distasteful, not when it's easy.

AIG promised those bonuses via contract over a year ago -- well before the crash occurred. As a contractual obligation, AIG was therefore under the same legal obligation to pay those bonuses as it was to pay the light bill. Obama's stimulus gave the company the solvency it needed to pay its bills.

Senator Dodd added an amendment to the stimulus bill that expressly protected bonuses promised to employees prior to Feb 11, 2009.

Now people are upset about those bonuses, the government is passing confiscatory taxes to take them back.

What concerns me here is an emerging trend by this administration to conduct "community organizing" on a national scale. There's a pattern emerging whereby they generate mass outrage, and then unleash that outrage against a target.

The trick is that people do things when they're angry that they might not do otherwise, because people don't think when they're angry. An angry mob can be easily steered wherever a clever leader wants it to go. This is the reason why the administration is always in a hurry to pass a particular agenda item -- it has to harness the mob's energy before it evaporates.

In this case, if you strip away the anger for a moment and look at what the other hand is doing, we're signing up to a huge precedent: the idea that if the government feels your employer is paying you too much, it is justified in confiscating that money from you. In other words, we're giving the government license to limit compensation employers give to employees.

We're OK with this right now, because we're angry and want to take out our rage against these people. But once the adrenaline is gone, we'll realize that we've just given the government a foot in the door to impose salary caps and use punitive taxes against individuals.

The other disturbing aspect of this is Barney Frank demanding a list of names of who received the bonuses. People are already making death threats. It disturbs me that the federal government that's managing through mob rule tactics is seeking the identities of people to target. What do you think is going to happen when the list goes public?

You can see it brewing -- a lynch mob being motivated by a drumbeat that being rich is a sin, and that people of substance need to be punished. I can see BMWs being keyed across the country and expensive homes being vandalized. The drummer is sounding the beat of class warfare in order to achieve a political agenda, and the mob is rapidly reaching critical mass whereby anyone who questions it is destroyed without consideration in a flood of emotion.

This isn't what America is about. We're supposed to be better than this.

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Location: Florida,USA
Joined: 08/21/2003
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AIG

It is also unConstitutional.
I really don't think that any Federal Judge will uphold that piece of Legislation, if it were to pass the Senate and Obama were to sign it.

bitmasher's picture
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AIG

AIG and the link to Dodd and Obama promises to be the largest debacle yet of the young administration. The reason I say this is because AIG is literally the linchpin in correcting the financial markets, its why the Federal Reserve moved so swiftly to save it last fall and why Bernanke is so pissed about the matter (he had no choice). I can see where we will continue to read many quarters of huge profit losses at AIG, this will push the handling of AIG front and center for sometime to come. AIG is a long public relations battle and the administration is stumbling in the first inning.

Because the bonus protection can be easily tied to Dodd and Obama, I think this is why we are seeing a near witch hunt to lay blame on the AIG executives and to tax away the bonuses, because the only alternative is to blame the democrats with their hands in the matter. Its a tar baby that will only get stickier.

For a lot of people AIG has come on to the radar in the last few months. In fact, AIG first ran into trouble with Elliot Spitzer in 2005, when AIG founder Maurice "Hank" Greenberg was charged with a variety of financial misdeeds. Elliot (a democrat) went through troves of AIG records back then, but I really don't remember the NY-AG office ever portending what was to happen in a few years or warning that AIG's collapse was imminent. This flies in the face of the idea that lax regulations under Bush somehow engineered this financial mess with AIG at the apex. A lot of high profile democrats were watching AIG before it failed, while it failed, and assisted it after failure.

All that being said, the pack mentality that is descending on AIG is disturbing. Its a lynch mob and worse it targets the people that most need to stay at AIG and fix its problems. This is sure to create an exodus of talent at AIG leaving Uncle Sam holding an even bigger basket case than it already is. I think Obama realizes how bad this bonus issue (first protecting the bonuses, then demanding the return, then suggesting that taxing the bonus is overreaching) is getting and evolved too quickly to control it in the public relations arena.

expatriate's picture
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Location: Arizona
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Posts: 3207
AIG

All the bluster and drama over this thing also attempts to cover a huge point -- it was Congress that sent the taxpayer dollars to AIG.

Meanwhile, it appears that the longer this goes on, the more people are starting to think about what we're doing -- and not liking what they're seeing.

The news these days is like the movie version of "Atlas Shrugged." Ayn Rand herself could've written this stuff.

Case in point -- bank executives talking about pulling out of the game in true John Galt fashion:
http://www.ft.com/cms/s/0/4ff2f77e-1584-11de-b9a9-0000779fd2ac.html

People living in fear for the unpardonable sin of achieving financial success:
http://apnews.myway.com/article/20090320/D9720I901.html

There's no way anyone can look at this snowballing disaster as beneficial to America's economic health. As soon as the witch hunt began against AIG, the market started heading south again. Obama's recent decision to print up another trillion dollars and dump it on the market didn't help, either, because people are already nervous about inflation arising down the road from all of the cash being printed.

In the last two months, we've seen this administration do nothing but reward failure and punish success. It doesn't matter how much money you pump into the economy if the people who invest and run the market think you're bent on destroying it.

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Joined: 09/06/2008
Posts: 1071
AIG

This though is the problem with taking money from the Federal government. You take their money you start having to play by their rules. Rather like the old Arab saying about just having the camels nose under your tent flap. The rest of the Camel is soon to follow. I don't like someone telling me what to do with my money. If however it's not my money, but money given to me to bail my sorry butt out of trouble by taxpayers it might not be unreasonable to think said taxpayer might want a say in how I spend it. Especially since I lost all of mine in the first place.

expatriate's picture
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AIG

Go to the Huffington Post and read the comments following he story about AIG executives living in fear. Scroll down to the comments section and look at what America is becoming -- a nation of bolsheviks. To those who would claim "it can't happen here", I submit the following:

http://www.huffingtonpost.com/2009/03/20/bonus-outrage-aig-employe_n_177...

Assemble the guillotine and let the Reign of Terror begin.

I'm ashamed to see Americans acting this way...absolutely ashamed. Hundreds of thousands of Americans have taken an oath to support and defend the Constitution of the United States, and at this moment a huge number of them are sitting in harm's way around the world. And when they put their guns in the rack and sit down in the DFAC for chow, they look up at the TV and see this happening at home.

It breaks my heart. sad

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Location: California
Joined: 09/06/2008
Posts: 1071
AIG

From the article,

Quote:
"However someone may feel about the appropriateness of the retention payments, there is nothing appropriate about the threats that people have made to and about employees,"

This is disgusting from any point of view, or should be. Very disappointing. Your right Expat.

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Joined: 07/29/2008
Posts: 723
AIG

I'm so sad.

Excuse me while I start to cry.

Boo hoo.

Big smile

So why did half the Republicans in the Congress vote to sock it to the AIG execs? 90% tax is pretty big eh?

God, Guns, Gays, and Gault. Best thing about Gault is he just shut up and left.

expatriate's picture
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Location: Arizona
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Posts: 3207
AIG

So why did Treasury ask Dodd to insert an amendment protecting bonuses promised to employees prior to Feb 11th? Why would the administration make it a point to protect the bonuses, and then act SO offended that they happened?

What amazes me is that you're OK with this. The same guy that caterwauls so loudly about the Patriot Act and civil liberties is indorsing government confiscation of property because it thinks an employer was too generous, punitive taxation against individuals, mob rule, and a witch hunt against the upper class as government tries to get names of individuals to attack in public.

You complain about wiretapping suspected terrorists, but are OK with taking away firearms and restricting free speech.

You are the classic Milgram subject -- willing to do the most horrid things to others because you think it doesn't affect you and you don't have any responsibility.

As for John Galt, you obviously don't know what you're talking about because you can't even spell the name. At least try to learn something before parroting someone else's KOS posts.

I'm reading "Atlas Shrugged" at the moment for the precise reason that the left has been heaping so much scorn and derision on it trying to discount what was a highly acclaimed novel until this year. That made me suspicious. It's been my experience that when the left starts rolling out the scorn and ridicule, it's because there's something damaging to their cause that they don't want yo to see.

As I'm working my way through the book, I can see why they're scared. Frankly, it's mind boggling to read a novel published in 1957 and see contemporary politics on every page.

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AIG
Quote:
highly acclaimed novel

I read Atlas Shrugged in junior high during my dope smoking days. Didn't find it half so entertaining when I hit 17. Can't believe adults read that kind of thing, what next, the hobit?

Quote:
caterwauls so loudly about the Patriot Act

When? I don't remember mentioning patriot act?

Quote:
government confiscation of property

My money. I'm welcome to say how it's spent. Are you on the side of the terrorists?

Quote:
You complain about wiretapping suspected terrorists

Did not.

Expatriate you need to get a grip big buddy. Don't say I said things I didn't and who the heck cares about a bunch of rich bankers. People die every day, so they get scared in thier McMansions. so what.

It's the Fox not news and the Free Republic, get out and go hunting maybe.

expatriate's picture
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Location: Arizona
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Posts: 3207
AIG

The dope smoking explains a lot. I suspected as much. I don't know what junior high you went to, but I've seen more of them than you could shake a stick at, and they don't assign thousand-page novels. Nor do I think junior high students have much to offer in terms of literary analysis, economic policy or comprehension of objectivism as a political philosophy. Besides, if you read a thousand pages of Atlas Shrugged, how can you still not spell "Galt?"

With time, I could dig through your painful posts and find references to PA. You've been caterwauling about Bush and civil liberties since you've been on this forum. You probably don't remember it for the same reason you can't remember "Galt."

And you're right. My money -- I should decide how it's spent. That's the American way. Life, liberty, and the pursuit of happiness. This administration is misfiring on all three.

Those rich bankers, by the way, control our financial system. People like them also pay most of the income tax revenue. I care because I'm smart enough to realize that if the engine of capitalism fails, the whole train stops.

What's apparent here is that you're the worst sort of herd animal whose entire system of values boils down to one thing: Does it affect you personally? If it doesn't, you don't care. You're more than willing to throw anybody under the bus if you think it won't come back to you. The only liberties that matter to you are the ones that affect your particular airspace. The rest of us realize that the best way to preserve our own liberties is to preserve the liberties of others.

The difference between you and I is that I want to kill the lion. You're content to just keep pushing others to the edge of the herd in hopes that the lion won't come for you.