MikeLigalig.com

AIG Restructures Bonuses to Extend Bailout

Embattled Insurer Says Bonuses Can't Be Cancelled Because of Contracts

By MATT JAFFE
WASHINGTON, March 14, 2009

Embattled insurance giant American International Group, the recipient of more than $180 billion in government aid, has agreed to restructure the terms of corporate bonuses after Treasury Secretary Tim Geithner demanded changes, an Obama administration official tells ABC News.

The government's bailout of AIG now tops $160 billion. That and other government bailout spending could result in higher taxes down the road, experts say.

The official said Geithner, in a phone call on Wednesday, told AIG CEO Edward Liddy that it was unacceptable for the company to give out tens of millions of dollars in bonuses for senior executives, as they are planning to do this week. Liddy wrote to Geithner telling him that the bonuses could not be cancelled altogether for breach-of-contract reasons, but AIG would change the terms of some of the payments.

AIG has been the largest recipient of financial help as the government has spent trillions to address the current crisis.

In four tranches of funds, the most recent coming just weeks ago, the insurance giant has been bailed out by over $180 billion in federal aid, but this week's bonuses for senior executives were agreed upon before the government's rescue efforts began.

Geithner has been a vocal critic of the damage that some executives have done in doling out massive bonuses even as their companies were collapsing.

At a Senate Budget Committee hearing Thursday, Sen. Bernie Sanders, I-Vt., expressed his outrage about "greed on Wall Street."

"I completely share your sense of basic outrage and anger," Geithner replied. "I understand how powerful it is across the country. You're absolutely right that the judgments made by the leaders of our financial institutions have caused a catastrophic loss of basic confidence. It's making everything worse."

Earlier in the week, Geithner emphasized in an interview with PBS's Charlie Rose that some executives had "made some exceptionally bad judgments."

"As they got themselves in the position where they needed exceptional assistance from the government, many of those directors made things dramatically worse by continuing to pay out really unjustifiable bonuses to their senior executives and they were losing tens of billions of dollars," Geithner said.

kining mga tawhana wa oroy pod mauwaw!!!

Wa naman ni sila Glace kabalo unsa ang uwaw.Mablame pud nato ang goberno ani kay kabalo ni sila ga usik usik kwarta gi bail out pa jud.

When asked to comment, AIG bigwigs said "their hands are tied" to the contract they signed with their employees.  It's just so mind-boggling that some people are shameless to accept a so called bonus when they failed their job to the point of having to seek for help from the federal government.  And it is more mind-boggling that AIG, where people trust their money, can have a contact with their employees or contractors or agenyts to give bonus irregardless of how the company was managed. tsk tsk tsk  Unya, they got bonus technically from the people's money na intawon ang mga katawhan nga foreclose ang ilang balay unya wala man gani mag bail out sa ila. 

Kong Japanese pa ning mga tawhana, nag hara kiri na sa ka ulaw sa gidangatan sa ilang company.

kung akoy pasultion, way kalainan ning ilang tulubagon kompara sa "kaso" ni madoff... baga jud og nawong ning mga taga-AIG. way delikadeza. way kasingkasing, way batikon.

bagaa ug kobal aning taga AIG. laliman ka anang bailout fund nga $170 million gikan sa gobyerno, $168 million gihatag lang as bonuses sa ilang tanang heads. $2 million nalang tawn bilin. ulbong kaspa ni obama.

billion na, bay bnc, ilang bailout. ana kadako ilang utang sa mga tax-payers. karon gi-galing ilang CEO sa congress, kay kono contract na ning ilang bonuses. kung ngano wa na lang nila ingna nang ilang mga executives, "kay palpak man mo, di mo angayan aning bonus bisag naay kontrata." huna-hunaa na, usa ka tawo modawat og 4 million $$$ as bonus. laway na lang tawn mga amerikano kay ilang balay ug mga trabaho, nangawagtang na. ako nila mag-gama silag bitayanan aning mga baga og nawong.

angayan ning mga tawhana balhin sa pinas aron kuyog sa admin ni arroyo ug sa iyang pamilya. dako ra ba jud ug papel si FGMA aning celso de los angeles aka bill madoff of the philippines.

they should be put to prison ibagsak ang mga greedy sa mundo

90% tax sa ilang nadawat nga bonus...may ra!!!

Quote from: grazie7y on March 17, 2009, 11:08:02 PM
When asked to comment, AIG bigwigs said "their hands are tied" to the contract they signed with their employees.  It's just so mind-boggling that some people are shameless to accept a so called bonus when they failed their job to the point of having to seek for help from the federal government.  And it is more mind-boggling that AIG, where people trust their money, can have a contact with their employees or contractors or agenyts to give bonus irregardless of how the company was managed. tsk tsk tsk  Unya, they got bonus technically from the people's money na intawon ang mga katawhan nga foreclose ang ilang balay unya wala man gani mag bail out sa ila. 

Kong Japanese pa ning mga tawhana, nag hara kiri na sa ka ulaw sa gidangatan sa ilang company.

'Hands are tied' is almost like selling their souls to the devil.

It is really disgusting how these invididuals can sleep at night. Knowing that millions of Americans are in economic woes and thousands of families in hardtimes. While they, the CEOs and Execs enjoy luxury yacht trips, private planes, golf games.

Dili man jud mo tug ang Ginoo ug dili pood bongol ang Ginoo.

Quote from: glacier_71 on March 17, 2009, 08:09:19 PM
kining mga tawhana wa oroy pod mauwaw!!!

You are right, Glace. And I wouldn't even target just AIG heads, I would go as far as pointing fingers as Goldman-Sachs heads, etc.

America is becoming (or is already) a plutocracy.

Quote from: glacier_71 on March 20, 2009, 07:43:50 PM
90% tax sa ilang nadawat nga bonus...may ra!!!

Glace, not just tax benefits, but they and their friends receive fee waivers. (this includes big time Washington lobbyists and even members of Congress!)

Best thing we can do as individuals to do is vote with your feet.  Don't invest with these unethical companies, even indirectly through your pension.  Instead try putting your money into a local agribusiness, for instance.

You're right, Ben. I'm doing my share by trying to shop and buying locally.