Obama Tells Treasury Chief to Block A.I.G. Bonuses

Obama Tells Treasury Chief to Block A.I.G. Bonuses

www.nytimes.com

WASHINGTON — President Obama vowed to try to stop the faltering insurance giant American International Group from paying out hundreds of millions of dollars in bonuses to executives, as the administration scrambled to avert a populist backlash against banks and Wall Street that could complicate Mr. Obama’s economic recovery agenda.

“In the last six months, A.I.G. has received substantial sums from the U.S. Treasury,” Mr. Obama said. He added that he had asked Treasury Secretary Timothy Geithner “to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole.”

In strongly-worded remarks delivered in the White House East Room before small business owners, Mr. Obama called A.I.G. “a corporation that finds itself in financial distress due to recklessness and greed.”

“Under these circumstances, it’s hard to understand how derivative traders at A.I.G. warranted any bonuses at all, much less $165 million in extra pay,” Mr. Obama said. “How do they justify this outrage to the taxpayers who are keeping the company afloat?”

(visit the link for the full news article)

GOOD... EXCELLENT EVEN!!!

The excuse that they are contracturally obligated to hand out those bonuses is a crock especially when you consider how many good and decent employees throughout this country are being forced to give back hard won concessions just to keep their jobs.

It should be no different on Wall street.

www.nytimes.com
(visit the link for the full news article)

If the govt owns 80% of the corp there must be a way around these bonuses.

Just like people receiving welfare are not allowed money in the bank, a car worth more than $1000, and are required to show every sort of proof of what they are doing with said benefits, why should these people be required to do anything less.

We can only hope the legalities will not block this, you know those lousy loopholes. red

When I heard about the bonuses I turned purple but this made my day. There is no telling me that these people didn't know what they were doing when they made such a mess of things and they don't deserve anything.

I suppose that if a few conditions had been placed upon these bailout funds, this wouldn't have been a problem in the first place.

Oh well. Its $165 million. Its a drop in the bucket. The government has dispersed over $1 trillion worth of bailout money over the last several months and two administrations. I can guarantee you that a lot more than $165 million has been thrown down the toilet now.

Contracturally obligated..words like that really annoy me,surely if times are hard things like bonuses are put on hold.
In my job all pay rises are put on hold because of the economic crisis..basicly we were told a pay rise or no job,everybody understands the problems & are willing to wait untill things pick up.
Glad obama is trying to stop it

True. $165 Mil is a drop in the bucket compared to the $30 billion they just borrowed, but this is a move I have to applaud Obama on taking.

AIG has no business giving any of its executives bonuses after they came back to the government till for a second round of money.

[edit on 16-3-2009 by sos37]

Wow. I am frankly stunned at how angry people are about these bonuses.

If you understand the industry, the backbone of performance is based on bonuses. We are not talking about CEOs only here.

Obama needs to get his socialist nose and his trained poodle Geitner out of corporate America.
Sorry, I don't normally use such condemnatory terms, but, frankly, these people are either extremely foolish or actively destructive.

Give them the money, and let's move on.

I don't understand why the Treasury Dept doesn't use the legal maneuver to charge AIG with an act of sedition for causing the stock market to crash.

to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole

The thing is, the rhetoric looks good, but if he already knows there's no legal avenue to pursue than it's just empty talk that sounds good.

Originally posted by Iago18
Wow. I am frankly stunned at how angry people are about these bonuses.

If you understand the industry, the backbone of performance is based on bonuses. We are not talking about CEOs only here.

Obama needs to get his socialist nose and his trained poodle Geitner out of corporate America.
Sorry, I don't normally use such condemnatory terms, but, frankly, these people are either extremely foolish or actively destructive.

Give them the money, and let's move on.

Excuse me?

If it were not for all the money being pumped in, that the tax payers are on the hook for, plus interest, those same corporations would have failed big time. The only socialism going on here is rampant corporate socialism, whereby they get all the money and we get all the debt, plus interest.

Let them all fail and maybe we'll get something instead that is properly regulated, by bodies outside of the industry, to prevent this corporate greed from robbing us all again.

AIG needs to be put into bankruptcy and restructured. We could start with the Derivatives black hole that is swallowing this country. The gov't hasn't done squat about the 700 Trillion in Derivatives that are the cause behind this disintegration of world trade, finance, and credit, yet they feign outrage at these bonuses. Just the latest head fake in the ongoing destruction of america through debt.

Nope, it looks like the derivatives losers will be allowed to keep playing the game and come back yet again for more taxpayer loot. When will people wake up? One thing for sure, this can't go on for too long, 700 Trillion has already made quick work of 50% of global wealth. Considering it only took 18 months, how fast could the other 50% vanish? Somewhere down this road things will change, and probably not for the better.

People who call Obama a socialist do not understand politics

Originally posted by ModernAcademia
People who call Obama a socialist do not understand politics

AMEN AMEN AMEN!!!

Or economics or society or much of anything else for that matter.

The thing is, the rhetoric looks good, but if he already knows there's no legal avenue to pursue than it's just empty talk that sounds good.

reply to post by flybynight


Starred.

Here's the plan:

Send in the lawyers to try to ferret out any corrupt practices in business while turning it into a public affairs side show. Cover up massive fraud committed by Obama's own administration and Congress (Stimulus Bill fraud, paybacks and waiste)

Companies have to spend billions defending themselves against the government lawyers or about twice what they would normally pay in bonuses. Difficult business climate causes company ececutives to move company off shore.

Move away from trickle down or supply side economics.

No tax breaks for the rich or producers/ employers even though they have suffered greatly from the recession since Obama took office.

Redistribution of wealth to lower wage earners and non producers.

HUGO CHAVIS did the same in Venezuela except he sent in the military instead of the lawyers!

The entire situation is absurd, but I hold Washington DC just as accountable as AIG, IMHO. That is where your anger should be directed. Keep it in perspective.

The bailout for AIG is straight up money from the FED in a credit window and there were no stipulations on it's allocation. Most of it has already gone overseas but you won't hear a peep about about that - why? Because it would tick-off our so-called allies.

The outrage coming from DC on this topic is phony posturing so as to limit the grime they get on them from wallowing in the mud with the Money Mafia. Obama asking Geithner to look into it is just a dog and pony show.

Here is the document that was circulated around DC prior to the AIG bailout:

88.80.13.160.nyud.net...

It's extortion. Give me this or else... And our elected officials did. They are ALL to blame.

[edit on 16/3/2009 by kosmicjack]

reply to post by kosmicjack


My point exactly. Just look at where tens of billions of the first bailout went, Overseas! Our own gov't is assisting in the economic destruction of america. Someone decided that a country with as many freedoms as america wasn't a good role model for the One World system.

After hearing about the auto workers making concessions out side of their union contracts, how is this any different? Only a larger scale.

These guys had legal labor contracts and still under the threat of losing their jobs they made concessions. Why shouldn't these greed mongers do the same. This has nothing to do with socialism. This is common sense, these people expecting bonuses are the same people who are partially responsible for the crisis we are in. If anything they should all be fired.

Originally posted by ModernAcademia
People who call Obama a socialist do not understand politics

People who come into a thread just to tell others they don't understand without telling us what THEY know that they think we don't know, don't understand how ignorant it looks and how ignorant they are for saying it.

reply to post by grover


Kind of late right now don't you think? for Obama's outrage gesture?

If he was so into helping this nation save the tax payer, he will not be in cohorts with the Federal Reserve gouging tax payer money to keep financing the banking institutions the corrupted AIG and giving the Federal Reserve the power to do as they want to keep the markets going.

When people are going to wake up and see that America the great is over spend, that we can not longer finance any thing without making more stimulus packages and that the Obama administration keeps ignoring the Real issues killing the nation in order to prop the markets.

Obama economic recovery is turning ugly.

So sad.