Sounds like more Horse manure to me! AIG should have failed! That would have saved us all Billions of dollars! ( 160 Billion - so far I believe)

The payments you mentioned were among the the very reasons for the "bailout" loans. When AIG lost its AAA rating in 2008, it could not longer get uncollateralized credit. But it still owed payments to the thousands of businesses it insures. These were but a few of them.

Bonus contracts are based on performance. Contracts are legally binding. No performance, no bonus. It is as simple as that. I am a taxpayer and I want the C-class fired immediately and return all bonuses. They may keep their salaries because that is not performance based. Bonus, no, they do NOT have a right to it. Shake up this company for Christ sake. Director level all the way to the TOP !!! Please...

AIG is nothing but BS!

HOw about those who continue to vote for Barney Frank are the incompetents?

I m with you life.... if they are handing out money... my bank account could use a bit of 'padding' as well!

I'm Sure that I don't understand what the government is trying to do by giving so much money away. I'm sure that the very people that are responsible for the problems are incompetent for correcting it. Common sense dictates real change in how we do things is what's needed. Irresponsibility is not change Obama.

If a company is to big to be allowed to fail, it needs to be broken up. It's been done before.

Telling Congress give us billions or else we will go under and take everyone with us is extortion. The heads of AIG need to be arrested, and all the bonus getters, that did not help the company need to be fired. If I don't do my job, I don't get bonuses or raises, if I stink at it, I'm on the street.

AIG's arguement was that they were conractually bound to those bonuses... and that they feared the employees would leave and not work for AIG anymore.

I think the first arguement is null due to the crash in the market. The second, well, where else would they work? I am not sure there is an employer out there that would be willing to hire such criminal/ incompetent disgusting behavior!

Quote from Barney Frank: to pay millions in executive bonuses amounts to "rewarding incompetence."

And Blarney Frank should know , he invented incompetence!!

When is congress going to put an end to this bullsh_t! The United States and it's people (if we do count though I'm beginning to doubt it) are taking the biggest kick in the teeth that has ever occured in history. Congress had better get it's act together and put an absolute stop to this nonsense. Every week we hear more of the same.....people and companies who don't need baleouts and bonus's but none the less get them while the rest of us sorry sots wonder if we'll be able to go to work tomorrow, eat next week or have a place to live next month. This is all pure crap in it's most discusting form. These corporations have become so greedy and selfish that they have no regard for any of us other than a source for more wealth for themselves. No one in any company that is failing deserves any bonus at all, rather they should all be fired just like the rest of us would be. This whole mess is getting deeper and beginning to smell more and more with each day.....it's become a cesspool! I've had it!!!!

Congress better buck-up and punish these thiefs at AIG. Take back the 170 billion and let it fail along with GM, Chrysler, banks, etc. Lets get a fresh start and get our budget in order.

Good going Mr Obama I will sleep better at night knowing you are just going to hand my future and my kids future over to these people. It was a good speech but it was all just crap. Your just a Bush of another color.

Peter Jacobs is correct. Bonuses are paid "for performance." If you cannot show performance from the previous year, there is no bonus. There is never an implied automatic bonus for poor performance that I'm aware of. It appears AIG is using this as a ploy to keep their executive team in place because the toxic debt is so complicated that it would take new employees too long to ramp up to try to figure out how to get them out of the mess they're in. Quite frankly, all of them should be fired for poor performance.

In regard to Barney Frank calling AIG incompetent. That's like the pot calling the kettle black! If Barney had done his job in the first place, and put in the proper Fail/Safe mechanisms in the first Bailout Plan, AIG would not have been allowed to give out any bonuses. Barney Frank is a disgrace!

The article says we the taxpayers own 80% of this company. If that is the case then as stockholders should have the say if these A--h----s get their bonuses. This stockholder votes not only "NO" but "H*** NO!!!!!!! Start writng to your congressmen and thank them for giving away our money to the European banks as well. Do I see a cleam sweep of Congress next year?

Any establishment that was going to accept government assistance should have had to do a CONTRACT RESTRUCTURING for all executives that were offered bonuses as part of their employment contract.

This should have been a stipulation written into BOTH bills. How in the hell do you expect an establishment to correct itself when you throw money at it and allow them to CONTINUE the same damn erroneous actions that landed them in boiling water in the first place.

These executives should all be taken out back and hung. And as for the Congress, strung out in the desert to rot for treason!

I am sickened by this; to know this and then to hear to senators this morning say that AIG will get even more money, is outrageous; I cannot believe that they rushed to judgment, gave them so much money and did not anticipate these contracts; if the company had been forced into chapter 13 bankruptcy, these people would not be receiving bonuses, the trustee is way too smart for that, why is our government not smart enough to stop this injustice; my future grandchildren will want to know why they are enslaved in tax debt.

This bailout is not working! It's just making the rich, richer. All this is doing is killing the hard working class/ middle class people. Soon, the rich will be richer and everyone else will be poor.

We simply can't continue to run this country this way!!! It's insane!!! We've flipped our lids!!! Fell off our rocker!!! Screws are loose!!!

And some people still say I can't blame Obama, because he has only been there 56 days. My friend I can, I do, because if he and the Congress have done all this in just 56 days, just thinking what they can do with 56 days more. You wanted change? Well youl got it. Just hope it was what you expected, or couldn't you read the writing on the wall before the election and his coming to power ?

The name is an oxymoron.

There is nothing American about aig, maybe jig, "Jackals insurance group", or Greedy Insurance Group

Take back the 170 billion and let it fail along with GM, Chrysler, banks, etc. Lets get a fresh start and get our budget in order.

Duh...........there wouldn't be a budget to get back in order.

Get rid of all the loop holes for corps and their offshore back accounts and tax heavens.

Presto....... balanced budget!

Rumor has it that:

AIG INSURES THE PENSION TRUST OF THE UNITED STATES CONGRESS!

Obviously if that is true now you know why AIG is getting all that money.

AIG insured many of the loans that failed and are now paying that insurance to the holders of the loans.

AIG under-reserved and did not spread the risk on billions of bucks of loans/credit instruments, apparently, as seen from the enormous payouts to the banks in France, Germany, and Switzerland (and the Swiss refuse to divulge info on thousands of U.S. tax evaders, private and corporate). But it's all good, Uncle Sam to the rescue. Aren't all the bankers just special (sarcasm), looking out for one another, and enabling eachother in their bad business practices. AIG should have been dismantled from the beginning, as obviously we could have saved a ton of taxpayer money had we just let the FDIC and Dept. of Insurance cover their sorry beeps FOUR bailouts ago.

Corporate welfare is killing the economy.

What about a free market? Everything needs to end sooner or later. It's the hard and sad part of life, but we all deal with the end of things. I will no be sad if AIG goes under, IT NEEDS TO!

Barney Frank is criticizing AIG and accusing them of rewarding incompetance? Isnt that what he did when he drove Freddie Mac and Fannie May into offering home loans to those that should never have received them?

Please do not take this as a defense of AIG business actions, their execs accepting bonuses is reprehensible and should be brought up on charges by the FTC for not acting in the best interest of the shareholders.

But for Barney Frank to be criticising AIG for encouraging bad behavior is a bit hypocritical. He has no position to criticize how the economy has tanked with his intricate involvement on why it is. For you lefties, this is the equivalent of Geroge W. Bush criticizing Obama's handling of the Iraq/Afghanistan war. You say W. messed it up so he has no right to open his yapper. Same logic is applied to Barney Frank.

Pweeze be qwiet Barney, you aww an idiot!

If the CEOs that recieved these payments were interested in the country economy and the company they work for, they would give these bonuses back and make a huge statement that they CARE!

OUTRAGED doesn't begin to cover how I feel about this story. As my own adult children have seen their employment disappear and have to go on unemployment, I read about these bonuses and am just flabbergasted.

Let AIG fail. We'll survive. It might mean starting from scratch but that's what so many millions of we Americans are already doing. I lost my home in January. At 52, I find myself looking at homelessness and joblessness-- and I'm a professional (therapist).

No one was standing there ready to hand me a bonus for being a good citizen for 52 years the day I signed my home over. No one has handed me a bonus for paying my taxes every year.

AIG should get Z E R O dollars in any bailout. If they fail, then maybe then the "big boys" will know what it's like to be a REAL American in 2009.

i dont think the american people were "contractually obligated" to bail out these companies, nor do i believe that the performance of the executives warrant any bonuses.

the bailout monies were to be used to keep the business afloat, not make fatcats even richer. this is criminal.

Barney Frank criticizing AIG is like the "Pot calling the kettle black".

Frank is one of the people primarily responsible for the financial meltdown by constantly fighting against attempts by the Bush Administration to reign in the crazy lending practices at Fannie Mae & Freddie Mac - even browbeating the banks to make sub-prime mortgages to unqualified people.

Boy, this is sure a case of the pot calling the kettle black. Barney Frank is a bafoon and the voters in Massachussetts to to start looking for his replacement. Isn't Barney Frank the same fool that went on camera saying everything was fine with Fannie and Freddie a couple years ago as the storm was building? It's hard even listening to this guy trying to get words out of his mouth.

Yes AIG is a corrupt mess like everything on Wall St and we need competent, ethical lawmakers to reel them in, but somebody needs to get Barney Frank a nice set of Lincoln Logs to play with to keep him occupied.

"the financially strapped insurance giant, which is 80 percent owned by taxpayers,"

If this is the case then I vote to fire them and discontinue their contracts.

Dear Massachusetts please wake up and rid this country of one of the worse free loaders of all time and elect someone else other than B Franks, PLEASE This man has been on banking and finance committees since the conception of the first banking bailout and he has helped orchestrate this massive global fiasco.

"These people may have a right to their bonuses. They don't have a right to their jobs forever," said Frank"

No, bonuses are just that a bonus for GOOD work / production not failure.

And as you cite Mr. Franks they don't have a right to their jobs forever, I wish Mass. would wake up and retire you sir for you are either stupid, blind or corrupt, sorry for the lack of choices but how could you be there during the last bailout and be blind to this one occuring? This is to AL too because Rep. Richard Shelby has been there all along too. might as well add in N.Y with Rep. Schumer.

So what's the difference between this and your lawmakers who didn't even read the last two stimulous and pork laden bills without even reading it?

I'm not a Democrat nor a Republican but I think it's time for some of these lawmakers to hit the road jack!

(Rep. Barney Frank charged that a decision by the financially strapped insurance giant, which is 80 percent owned by taxpayers, to pay millions in executive bonuses amounts to "rewarding incompetence." )

The Fed owns 80% of AIG. Exercise that ownership, FIRE everyone, and divest of all pieces of AIG ASAP, and GET TAXPAYER MONEY BACK NOW!!!

How can anyone, in good conscience, reward bonuses for such ineptitude. How can their bonuses be justified???  They drove the company into the ground. Teach these bastards a lesson and disolve the company. Fire them all.

List their names and addresses for all to see. Blackball them from the financial sector for life. They don't deserve ANY job that doesn't require them to ask...."Do you want fries with that?" after every transaction they make, However, do NOT trust them with the money, let a high school kid do that part. Freaking theives the lot of them.

Anyone who deals financially with AIG in the future is dealing with an immoral company.

I keep hearing Obama,Obama,this did NOT start on his watch, he has the task of cleaning up ALL of the bush problems. Give the guy a chance,it's better than sitting on your hands for six years and doing nothing,BUSH!

Seems that all we do reward in this country is "incompetence". In the banking system, the political arena, etc. If you promise to do "nothing" for the American people, you can even become something like, "president", speaker of the house, sec. of state.

George, yes, we reward "Wall Street" for incompetence.

We reward "Main Street" for incompetence, as we're willing to hand over my tax money to help people with mortgages, and in some cases (not in all) these people simply were not able to handle their own finances.

If you're on Wall Street, and you know you're going to get millions in bonuses no matter what, do you really care?

IT'S NO RUMOR, AIG does insure congress's pension plan.

I agree, who the hell are these people getting bonuses?? Name them!!

PS - they don't work hard enough to deserve to be associated with fast food employees

How about all of you getting real, Barney Frank is not the only person guilty, take a close look at Sen. Richard (I am so offended by this) Shelby. This jerk was one of Bush's most ardent yes men. Remember to, that the bailout of these institutions was fully supported by the Bush White House and the Republicans in Congress. Lest you all forget both of these jerks and their parties carry enough guilt that they should all be impeached. It amazes me how each side can accuse the other in these posts when you all know your side is just as guilty, since when has anyone in Congress done anything that is only for the people? They don't do anything usless it benefits them or their favorite lobbyists. How about opening your eyes and seeing each side for what it is. They are both reeking with guilt.

Barney Frank should be thankful that people "reward incompentence", otherwise he would have been out of a job long ago.

Barney Frank should know incompetence when he sees it ... everyday in the morning when he looks in the mirror. He and his colleagues in Congress should all step down for incompetence. All they do is continue to bilk us for everything we are worth and claim it is in our best interest. Being in control of the House and Senate for 2 years have not made the Democrats any smarter or any less incompetent.

How, exactly, did Barney Frank come to be blamed in all of this? He was a member of the minority party in the banking comittee.

Does anyone actually check up on what they are saying here? Anyone?

This wasn't Barney Frank, it wasn't the Community Reinvestment Act. Get informed, people, and get angry with the real causes of this mess.

Sounds like it may be , ball bat time.

Obama should say NO to libby, and just sue me.

IF Obama is pursuing the prevention of AIG to pay out bonuses why didn't he put regulations on it before handing it out?! Why oh why does the federal gov't keep trusting these invesment banks?

Enough with all these bailouts!!!! get the stimulus going and fix mainstreet.

There are two stories here that people seem to miss.

1. AIG was operating the largest insurance company in the world completely oblivious to the risks they took. Think about that. That's like the army being run by 5 year olds. Insurance is one of the most important underpinnings of the economy because it assures business that their risk can be covered. AIG was covering more than the economic output of several companies combined in exchange for an absurdly small premium. This kind of leverage underpins this entire economic crisis and suggests that even when everything is 'back to normal' we'll have another crisis, maybe even worse.

2. AIG said their hand was forced to pay the bonuses by lawyers. Lawyers, in effect, are running this country- into the ground. They had to know the decision would be unpopular and even unproductive but lawyers made threats and they caved. I have a couple of problems with their decision. First, they are likely to have their own lawyers on retainer who would have fought the action, but I guess it's hard to fight a mutiny- still, where's the effort? Second, who exactly were these outside lawyers representing? Which exec called up a lawyer and said 'I'm entitled to this multi-million dollar bonus'? Self-preservation is important particularly when you think you may be up on the chopping block next week but where's the faith in the company and how much longer does AIG need to be running with this person or persons on board?

Thus, the entire financial system is rotting from within due to non-transparent, omnipresent leverage and small legal interests. What future does our economy have when it's rotting from the core?

Just keep paying your insurance premiums and putting money into your 401K- and try to sleep soundly.

Funny they had no problem making the auto workers re do there contracts I guess that because there blue collar workers.

I say take all the money back now. right now they gave 37 billion of our tax dollars to a bank in Europe. Get it back now. every god dang penny. As the taxpayer we demand it We don't care if you think it will hurt the business world take it now. Put ever dang penny on the bill we leave our children.

Funny when you made the auto workers do the right thing they are turning it around you keep kiss these people butt and they just keep coming back for me that AIG banks and wall street. Time to make them pay is now. Show this country you are a president of the people If not you just another mouth piece for the Rich.

Bonepony, yes that is a rumor.

AIG does notinsure Congress' pension fund. Total rumor. Check out FactCheck.org.

MovingOut, you're absolutely right. Lawyers in the United States are destroying this country. When a lawyer can fight to get millions in bonus money paid to an employee who did not produce one iota last year, but yet is still "entitled" to large sums of money, our country has officially lost its collective mind.

I didn't read the article nor am I defending AIG, or a fan of bonuses, unless you take away money from non-performers to fund it. That said, I do know AIG is a corporation with at least 2 or more business units. I would hope/assume the only people eligiblefor bonuses were part of a business unit that actually made money. As a holder of several AIGInsurance Policies, I've been told that unit is profitable, the losses are on the financial services side. Again don't accuse me of supporting AIG, just trying to offer an explanation of how they could justify the bonuses. The sad part is, usually the people who get bonuses, don't really need them.

It seems like eventually Congress would learn their lessons. It's always easier to change the terms of any agreement while the carrot is still attached to the stick. We'll get a lot of righteous indignation and lip service, but the bonuses were paid yesterday and soon enough this will just fade away with millions of other dollars yet to be pissed away.

Brian, see that's the rub: the insurance division which was their core business was and is still profitable. The bonuses aren't in that sector. The division that caused the issue is this Financial Product sector and we're to believe these contracts were written in early 2008 and have create a profit which triggered bonuses which defies what we know.

Read this link to understand much of it:

http://ezinearticles.com/?The-Collapse-of-AIG-and-Its-Impact-on-the-Mortgage-and-Banking-System&id=1816126

As pointed out by someone earlier, AIG needs to be split. Take the Financial Division out of it and let AIG's core insurance division itself become profitable again.

Also, seeing as AIG is effectively owned by taxpayers, I'd have to think the list of bonuses and recipients should be public knowledge.

Some have referred to Barney Frank as incompetent. Perhaps he is just a crook who was lining his own pocket with our money while all this went on.

If AIG has all these top performers how come they lost so much money? Their job was to manage risk and set appropriate fees so the company made money. It sounds like a repeat of the case where Roger Smith raked in millions while he ran GM into the ground a few years ago.

I understand the desire to keep AIG afloat. As one of the country's largest insurers, it's collapse would create massive problems. HOWEVER, I see no need to keep its current management afloat. Fire them all and put some one else in. God knows there are enough people out of work who could do better than these guys, and for less money.

They could not be allowed to fail because so many other businesses would have failed due to loss of insurance coverage with them. However, we already have bought enough of them to justify a shareholder takover and fire every one of the people that took a bonus to keep them on their job. As one of the other posters in here said "why give them money to stay when the question is" where the hell would they go?"

The company has shown several times it's inability to manage the size and understand the fact they are getting public money to prop up a private business. If they are too large to fail, then they are no longer a private company for all practical purposes.

Take them over. Fire enough of them to rattle the cages of those left. And then make sure they all know that another purge is in the works. Any desire or demand for bonuses will disappear and the remaining folks will be much more focused.

Either claw back those bonuses back to when they got the first 2 bailouts by the previous administration and then fire the clueless CEO and dismiss anyone on the Board of Directors that did not fight the issuance of bonuses, or they need to give every penny of the 180 Billion back immediately.

Frank should be in jail!! But a female jail so he doesn't have any fun!!

Every week we get another group of corp. exec. that still think the Republicans are in control,with a completely incompetint  president, and every week Obama has to take out his "piss-elm" club and smashh the the crap out of these corp stealer's. Keep smacking the hell out of them president Obama. REPUBICANS, AUTO's, BANKs , we still have OIL and the welfare farmer to go.   

This is what AIG does. It is an insurance company that insures bad debt. They were obligated to give their customers the money. Now the bonuses --- they sure are "Skeptical" like Barney says. However, Barney is also "Skeptical". He should resign out of the House or be taken out by the American people.

First some facts for everyone to consider.

1) AIG bonus contracts were signed in early 2008. Before the poop hit the fan and in my opinion with full knowledge of what was coming down the road.

1.a) The basis for the bonuses, although unknown, are based on performance. The problem is that "performance" is in the eye of the metric used. Clearly they used such watered down metrics that a 2 yr old would be viewed as having "good" performance.

2) The CEO and other C-officer's have declined their bonuses. No doubt fearful for their lives.

3) The CEO defended the bonuses as necessary to retain the "Best" and "Brightest". OK this one I just couldn't help but laugh my butt off.

4) Although I appreciate what the lawyers stated about contractual obligations. But, seriously contracts are re-negotiated all the time. Just ask any athlete. It's really simple: "You want your bonus or your job?"

5) The bonuses in question are for the financing unit responsible for the liquidity crisis they are in.

6) The Board of Directors should all be FIRED!!!

OK #6 is just my opinion, but in my little world it would be fact.

IF this is really true, and not just more flim-flam. Then this is a positive more. Just don't say: " Well we tried to have the bonuses rescinded, BUT, there was no LEGAL way. But I reallyyyyyyyyyyyyyyyyyyyy tried. JUST DO IT. STOP THE BONUSES.

As I said before, AIG should be seperated and the financial arm allowed to fail.If it can reorganize thru bankruptcy fine, if not so long. This is what should have happened last fall.

We.... TAXPAYERS... OWN 80 Freaking percent of AIG. Toss the board of Directors out on their collective asses. THEN, say... "Hey Slimmy.... get your arse in here... we gonna discuss this bonus @!$%#, ok?" One by one, these bozos that think they earned a bonus.... RENEGOTIATE their freaking bonuses. if they insist, tell them to SUE ME...then fire their arses. THEN, take AIG, the division that drove them into trouble with stupid and risky business ventures.... and disolve it. Close it down. Sell it, and put the money toward Taxpayer Debt yet to be repaid.

This whole thing is total BS. Who the hell are these people to tell US, the Owners of their freaking company, that they have no recourse??? Fire them and they dont get bonuses. No parachutes either.... freaking criminals.

Why does this surprise anyone? AIG is on the dole - well so are all the whack-jobidiots on Capital Hill - Barney Frank being in the top 5!! What a joke, politicians calling what AIG is doing as rewarding incompetence. We reward the incompetents on Capital Hill everyday - everyday they are screwing us too!!

Wow, Obama is going to yell "Oh you naughty boys. Badddd AIG!" Didn't say one word until the taxpayers started scream now did he? Obviously, thought they could just play along and say nothing but "don't do that in the future"

The money was to meet obligations under contracts of Insurance to banks. These hedge policies require payouts which AIG did not underwrite or price properly. Much the same as mortgage insurance, or the entire derivatives market, pricing for financial insurance products is a very complicated business - and they did it very poorly.

We need to understand that the Derivatives market is basically insurance against certain things happening in the market. The problem is that it is very easy to "write" a contract that you have no ability to fufill. Millions of "naked" call, put, futures or other contracts are written daily with absolutely nothing to back them up. The premiums earned on these contracts push prices lower as the market does well, but with a major correction, the RESERVES THAT SHOULD HAVE BEEN SET ASIDE WHEN THE CONTRACT WAS WRITTEN WERE NOT SUFFICIENT.

The main cause of this problem is how insurance is underwrtitten. Two type of insurance exist - General and Life. General insurance is generally a flow through business where premiums are managed in a short term fashion to meet obligations mainly in the next 12 - 24 months. Life Insurance / Pension are long term contracts which have long term obligaitons. In both cases regulations stipulate reasonable policy reserves and accounting to ensure claims are paid.

The problme with fianancial "insurance" is that it is not regulated. Typically, broad guidelines on policy reserves are taken from the Life Insurance indsutry setting up long term reserves (which keeps the maximum profits). The problem is that financial assets actaully are catastrophic in the way claims are handled - not long term. Much like earthquake or hurrican insurance, when it rains, it pours.

That is why AIG went sideways. The problem was that they had underwritten all kinds of insurance which made it possible for banks to do business with each other. Counterparties would work together in a risk free environment. With the failure of this buisiness, the entire banking system set up under Bretton Woods would fail - our entire monetary system which is based ona Global payments model where money is created by Commercial banks would faile, currency would become worthless, we would have anarchy.

Therefore, AIG had to bailed out. What Bush et al should have done was to cease operations of AIG and nationalize the company. Spun off the financial Insurance arm and ran the regular insurance company as the viable enterprise that it was. Leaving the company to remain a "private enterprise" was beyond foolish and has cost taxpayers hundreds of Billions.

We did not really have a choice in the continuation of AIG's business. The manner and executiuon of the continuation was something that should have been examined - and was not. Further, we need to examine the value of the Fractional Reserve monetary system and the work done 60 years ago at Bretton woods and determine if we can't find a better way to manage the money of our country.

Folks:

AIG is one of the biggest, if not the biggest insurance company in the world.

In addition to a bunch of other types of insurance, they provide mortgage insurance against loss if a home owner defaults on their loan. From their website....

Mortgage Insurance

Regardless of your role in the mortgage finance process, mortgage insurance plans can help you turn customers into homeowners.

Home Equity Default Insurance

AIG United Guaranty covers equity loans, HELOCs, piggyback seconds, and home improvement loans to support your credit risk and operational objectives

As you can well imagine this was not smart business, considering that so much of the property was not worth as much as appraised. Shame on AIG and the entire home real estate industry and the financial wizards who cooked up the stupid loans to buy this overpriced junk.

Now this normally would be bad enough, however AIG also threw their cash into the derivative market, (does anyone really understand this voodoo crap?), and gave insurance on the derivatives being conjured up out of sub-standard sub-prime paper. How's that for doubling down without a clue about what game you are playing!!

Needless to say, the music stopped, and no one saved a chair for AIG, and viola, they find themselves on their keesters on the floor. Fortunately we all are nice enough to offer them our place to sit while they catch their breath and brush the dirt off of their fat tuckuses.

Too big to fail, I don't think so. How about too big for their britches!

Good Luck!

rjkardo

"How, exactly, did Barney Frank come to be blamed in all of this?"

Simple. Most of the problems with Fannie Mae & Freddie Mac occurred in the last 2 years, while Barney Frank (and Chris Dodd) were the Chairmen of the Congressional oversight committees, and even before that they fought the Bush administration over attempts to reign in the loose lending practices - even threatening filibusters if the Administration tried to stop lending to "sub-prime" borrowers, and forcing the banks to "set-aside" a certain portion of their lending for the minority community.

Now, he's trying to put the blame on Bush - how ridiculous can you get. Of course, since they now control Congress, you won't see any investigations into what REALLY caused the meltdown that cost Americans over $15 Trillion.

"Frank, a Massachusetts Democrat and chairman of the House Financial Services Committee, added on NBC's "Today" show that "it does appear to be that we're rewarding incompetence." " I wonder where this guys been...what about the banks losing tons and still paying out either a bonus or a stock option instead of cash ? Why was any of it allowed...? Yet he is assying those CEO's should not have a job,,,but I guess the bank CEO's are different. Yep, they should be gone too.

Steve 686481 - well put. When AIG took the funds, all contractual bonus obligations should have been suspended until that portion of the company would again be profitable. But, those who pushed for the bailout couldn't take the time to review their own work!

Government Slogan:

Failure- Success is not a option!!

"We ought to explore everything that we can through the government to make sure that this money is not wasted," Shelby said. "These people brought this on themselves. Now you're rewarding failure. A lot of these people should be fired, not awarded bonuses. This is horrible. It's outrageous."

Yeah, I say that to my kids all the time, but they too know I am just talking outta my a$$.

AIG has agreed to the Obama administration's requests to restrain future payments.

No need for future payments, the checks have already cleared the taxpayer bank aka Washington.

Lets just nationalize and socialize everything and let the government direct it all since they're so smart. It's heading that way anyways with no checks or balances, why fight? You have no voice.

President Obama might want to expand his sense of outrage to include the members of Congress who spend and waste far more of the taxpayers money than any corporation ever could! What hypocrisy.

I am so liking Obama right now. Way to go PBO. For the first time in my life I see a US President stand up to big corporation and putting the voice of the common man on center stage. WOW !

I wish all of you corporate bashers held your government to the same standards as you hold AIG and others. Since when did wasteful spending become an issue with you? Has government, especially this government spent your money, not to mention your kids and grand kids money unwisely?

After a making a living out of verbally destroying any hope for the economy, Resident Obama is now changing course and talking up the positives. He's so embarrassing of a man that it makes me long for good ole GWB again, that's not exactly a compliment.

Does anyone on this board have any illusions of the kind of economic philosophies Resident Obama and his team are using as a template? Is this the change you people hoped for? Has America officially become the nanny state the democratic party has been for decades?

Can we get another great American leader to instill American pride and real patriotism back into our culture? I still believe in American exceptionalism. I just hope the country can withstand the lack of tru American leadership for the next four years.

freaking finally....if obama had been a leader from the start this small business loan announcement as well as this should have come a long time ago and 787 illion dolars ago.

We regularly reward incompetence in our country, we need look no further than congress and the reelection of the majority of corrupt partisans who crave power. Why not freeze their salaries until they turn around the deficit spending and obey the laws they enact and inflict on the rest of the poor fools who reelect them. That is our only chance, performance based compensation would flop because they not only decide on their salary and raises they routinely misrepresent their accomplishments, sadly the herd from whichever party wins the election buys they bilge every other year. Why is AIG a problem for these fools? Because enough people know about it to scare them as the light of truth shines on their incompetent corrupt policies, otherwise nobody in Washington would give a damn about this abuse of public funds.

Ya peter... The common man. We should all make exactly the same amount of money, "From each according to his ability, to each according to his need" Never mind that they probably worked harder and were the ones who actually made a profit. Workers of the world, unite... We'll defeat this evil capitalism where some are paid based on their accomplishments. Better everyone get the same pay, so they're all equal. That won't make the most productive members of a company leave or anything.

I'm starting to wonder what the initials of our country are. I know the first two are U.S. Not sure what comes next now. Could be an A or maybe S.R.

People with common sense have to remember that there are many good Republicans but many who are just plain ignorant. They want to blame Obama, Barney Frank and you never hear them mention their guys that got us into this mess.

Boohoo it's all Obama's fault. Get your pacifiers out of your mouths and try and deal with the facts. Your guys blew it and Obama has to do his best to fix it.

The hate of the far right is incredibly destructive, you call yourself Christians but really, many of you are just hypocrites. You call yourself patriots but you don't care about our country you just don't understand that your kind has become extinct..

Saw a picture of Obama today. He already looks 15 years older. (also looks like he is totaly stumped - or stoned!) Maybe he should have waited before running and ruining his life. The high point of his presidency has come and gone and its all downhill (or off a cliff) now.

Ya, there's never any hate from the left. Nice generalization about Christians and hypocrites though, broad, fact less, slander like that takes a lot of guts.

Barney Frank gets pointed out a lot because there is easy to find video of him defending the problem, and he was in charge of it for 2 years. You know so much, why don't you say who on the reps helped cause it and how, or how Barney Frank tried to prevent the problem. I'll even agree with you if you make a good point.

Rocket Dad your such a pessimist. From what you are saying McCain would have been dead by now. Then Palin would be running the country. When that happened our enemies would attack us for letting such a idiot run our country.

Lifeisadimention:

It means they paid banks like "Bank of America" which already got a bunch of bail out money.

Here's a quote from the LA Times, "The beneficiaries included major foreign banks such as Germany's Deutsche Bank and France's Societe Generale, as well as U.S. titans Goldman Sachs Group and Merrill Lynch & Co

"Before disclosing this information, AIG consulted with the Federal Reserve about the potential public benefit of counterparty disclosure and the potential that such disclosure would cause competitive harm to AIG or its counterparties," the company said.

The potential for a collapse of AIG to bring down other financial giants worldwide, because of what the insurer owed other institutions, was the major justification the government cited for the massive bailout of the company. But until now, taxpayers haven't been told which institutions ultimately were on the receiving end of the money funneled to AIG.

As revealed today, the payments the company made with federal dollars included $22.4 billion to initially back up credit default swaps, under which AIG had agreed to insure mortgage bonds and other securities against default. Banks and brokerages could have used the swaps either to insure bonds they owned or to speculate on defaults as financial markets crumbled.

AIG paid out additional billions later in the fall to cancel a batch of swaps entirely.

Societe Generale is listed as receiving a total of $11 billion related to credit default swap deals with AIG. Deutsche Bank got $5.4 billion. Goldman Sachs received $8.1 billion.

AIG also paid out $43.7 billion to banks and brokerages including Britain's Barclays, Bank of America Corp. and Citigroup to satisfy contracts made by the firm's securities-lending operation. That business involved lending securities held by AIG to banks and brokerages that wanted to "short" shares, for example. The firms in turn put up a certain amount of cash with AIG as collateral for the loaned securities.

Because AIG invested that collateral in risky mortgage securities that subsequently plunged in value, it had to dig up more cash to repay the banks and brokerages when the loaned shares were returned.

Finally, AIG said it made $12.1 billion in payments to municipalities to honor guaranteed investment agreements. Among the states, municipalities in California received the most -- about $1 billion. Municipalities in Virginia, Hawaii and Ohio also received large sums."

Why do I get the feeling they aren't telling all?

Instead of RUNNING YOUR MOUTH on Newsvine,,, CALL

AIG HQ & tell them F the bonus, we DARE those people to SUE
Whose going to be on the Jury- you and me and Americans... I dare them to SUE!!!

=== AIG US HQ 877-638-4244 === dont be rude, just let them know you want to talk to Ed Liddy... and REMEMBER the person answering the phone is making $10- an hour and isnt getting a bonus , so be nice.

here is the info to call the treasury dept 202-622-2000

and here is the (dont laugh) report Fraud, Abuse , Waste HOTLINE !!!

• Telephone: 1-800-359-3898

  Facsimile: 202-927-5799

• Mail:
  Treasury Hotline
  Office of Inspector General
  1500 Pennsylvania Ave., NW
  Washington, D.C. 20220
• Email: hotline@oig.treas.gov

LET GEITHNER KNOW... we DARE former employees to go sue AIG, we DARE THEM !!!

I just bet he will. yeah, Ogodma will great his miracles won't he. It sems everytime he's under the microscope he reacts. If nobody pitched a fit this would of gone under the radar.

I called AIG again they put me hold then gave Corp's direct#...

but that # never picked up...

I was very nice to the lady who answered at the 877# and I told her please relay

#1) Stop any payouts TODAY

#2) We dare these Execs to sue America

#3) I feel sorry for her as she has to be wondering are they trying to kill off the golden goose or what

#4) Liddy should resign if he isn't willing to put their Corporate Lawyers to work stopping any bogus Execs lawsuit.

#5) I wished her a nice day and told her I hope the company survives, albeit with different management.

In these "difficult economic times", let's be certain that federal employees get no pay increases.

If you're as pissed off as I am take a couple minutes to go to AIG's webpage and send them an email letting them know about it. Surely there has to be a point at which alienating an entire nation eliminates the demand for products and services and thus the need for that business to exist.

Barney Frank are you crazy or a front man for organized crime? Bernanke no guts and everyone jumps on Geitner who looks frazzled from the media making him the fall guy. Americans los trillions is always in the headline. Please now tell us who are the rich that found those trillions. Let's hold them accountable. Good reporting.

As a simple taxpayer I feel so, so, very powerless. Seems like the whole World runs on fraud and corruption. How can little old me do something about these fraudulent C-Class officers. What can I do to stop these kinds of people ? Seems like it is easier to join them then to beat them.

Oh, and Obama is going to halt paying out bonuses. This he says today after AIG paid theirs yesterday on their deadline. He knew when their deadline was and waited till it was a day late to come forth and yell He is going to stop bonuses being paid. ha, ha, ha! Typical government ploy - always react too late

Smoke and mirrors.

He's giving the appearance of doing something when in actuality he knows that legally nothing can be done. After all, he is a lawyer.

We've seen it before, we'll see it again. Shouldn't be surprised.

D'oh - should have thought this through BEFORE you gave away the money...

B.Frank said we may not be able to stop the bonus but the exc. are incompetent THEY CAN BE FIRED. All those bonus suckers need to be fired they have done a terrible job and are be awarded for this. Notice AIG does these sneaky things on the weekend so the crooks can take their money and run before the possible hammer comes down, why BECAUSE THEY KNOW THEY ARE WRONG. Any one affiliated with this company should talk with the advisor. I did I wanted to make sure my money was no where near them.

sumthin fishy:AIG is in the financial business as well as the insurance business. I have said many time in this forum that Insurance companies and Banks and brokerage houses should be separate businesses by law. It is way too dangerous to combine these businesses. Insurance companies do not make much profit from selling insurance. Their real profits comes from investing premium dollars.

Separate these companies by law. In the case of AIG if they did not have a financial services entity, the extent of their losses would have been much less.

AIG should be allowed to fail. This was nothing more than a Ponzi Scheme, just like Bernie Madoff. They have been playing this shell game for too long. Now the house of cards has come tuumbeling down. The worst part is Nancy Pelosi wants us to bail them out so she & her husband don't loose their millions. She's a nice girl. NOT!!!

Da.......Is everyone in governemnt a moron? The American people could see through this scam but our representatives were clueless? I think our corporate/government thinks it can just do what ever it wants (scratching each others backs) and we will just sit out here homeless and starving and be ok about it.

So your giving our money to AIG to cover corrupt criminal derivitives (sanctioned by our corporate/government) while giving our money to banks who supposedly lost money even though AIG is paying for their loses with our money...What? Our government needs to worry about protecting the American people from corporate fraud and abuse not from some fictitious terrorist boogy man.

The American people have been seriously terrorized and victimized by our own corporate/government.....

OK...here's what you do......

Those c o c k s u c k e r s at AIG can find loopholes in order to get them bonuses..they can find a loophole to retract them.................why do I doubt that's gonna happen?

So, just do this... tell those a s s h o l e s they can have the bonuses but need to give back the bailout money.

I know....we all know what's gonna happen......nothing. They'll get the bailout and (just a guess) the bonuses too.... because nobody's got the real balls to do anything about it.

Welcome to America....Nice work FEDS, you really know how to make it sound like you care...bunch of F#$%G possums.

Gotta go now, Im scheming a plan to rob some banks owned by AIG , so when my taxes go up to pay for all the bailouts and bonuses I'll be ready.

GG, insurance companies make all sorts of money, the reason their loosing (they aren't really) is because the profits off of their customers isn't enough for them, so they invest to boost profits more. But your right, none of these businesses should be able to combine into a corporate octopus. We've seen the results in the past when companies have more power then the government and from where I see it we're there again. I really don't understand why Obama will only kick in only $730 million for small business? What the hell is that all about. It's a small fraction of what the corporate overlords give themselves for bonus's, and it won't do a damn thing to help small businesses because the bueracracy it creates will eat up half of the funds, not unlike most federal programs. I'm really beginning to think that we need to start all over from scratch and redo all the laws, eliminate all loopholes, make lobbying illegal, give our reps in Washington a limit on their term in office and turn this country back into what our forfathers envisioned.

I am still waiting for 99% of the people who are justifiably peed off to realize it was Obama's appointed new overseer at AIG who said these bonuses HAD to be paid.

Next time I go sailing, I want BHO to come along: he sure can change direction quickly depending on which way the wind is blowing.

gg752859:

Yes, I think I mentioned that, and obviously it would be good if the premiums on insurance were not invested in crap....

Now this normally would be bad enough, however AIG also threw their cash into the derivative market, (does anyone really understand this voodoo crap?), and gave insurance on the derivatives being conjured up out of sub-standard sub-prime paper. How's that for doubling down without a clue about what game you are playing!!

Good Luck!

Voter-in-LA:

Liddy started his position at AIG in June 2008 so he went to work during the past administration....

Edward M. Liddy (born January 28, 1946) is currently the chief executive officer of American International Group (AIG), where he succeeded Robert B. Willumstad in June, 2008.^[1]. Liddy is currently on the board of 3M and The Kroger Company. Upon taking the position of CEO at American International Group, Mr. Liddy had to resign his board position at Goldman Sachs.^[2]

He is also the former chairman, president and CEO of Allstate. Prior to Allstate, Mr. Liddy also held the position of chief financial officer of G. D. Searle & Company, where former Defense Secretary Donald Rumsfeld held the CEO position. He has recently become a partner at private equity firm Clayton, Dubilier & Rice, which he joined in 2008.^[3]

Born in New Brunswick, New Jersey, he holds a degree from Catholic University of America (1968) and holds an MBA from George Washington University (1972).

As CEO of AIG, Liddy receives a salary of $1 and equity grants.^[

Good Luck!

What is a "Bonus" supposed to be for? I always thought it rewarded success. Since when does any company promise "bonuses" when they do a miserable job.

We should have let AIG fail, and then they couldn't pay these "credit default swaps" where over $100 Billion of taxpayer money was paid to people who suffered NO LOSSES.

No sane insurance company pays for losses not actually incurred and proven.

Taxpayers keep taking it in the shorts. It sounds like a lot of fraud was involved.

"As CEO of AIG, Liddy receives a salary of $1 and equity grants.^{" At least he's being paid appropriately.}

HELLO Mr. Obama....It's your appointee OVERSEEING AIG now!!!!! How stupid do you think the American public are. AIG did not fail because of YOUR Stimulus package, now they have to honor contracts. That means, they have given their promise to pay individuals a set amount of money. They could lie like you, and not pay anyone, but it appears they want to keep their word and back-up the contacts they agreed to. It was you, and your democrat congress that just send out trillions of dollars to a majority of companies it appears now, never really needed it. We now have a multi-trillion dollar debt, thanks to you.

Sumthin Fishy, sorry I get easily confused these days with all the "changes". To me it just proves Liddy has to go then. In any case I have ever witnessed where an outside regulator came on to oversee and take over the direction of a troubled company, the absolute first course of action is to look into this exact type of possible issue in remuneration. Liddy should have already been looking at how these contracts even came about. If AIG is pretending they didn't know about the imminent collapse when they created these pay packages, then the division heads are even dumber than I gave them credit for.

Good luck to BHO in stopping these bonuses. But along with the execs who found a way to quickly circumvent what they knew were going to be tougher times and smaller paychecks, Liddy needs to be pushed on out the door. No hearings needed. Just a pink slip.

If these people made money for the company they deserve their bonus. Not every division of aig loses money.

Barney Franks should grow a set and fire these AIG employee's. Barney sure talks the talk but he seems to waddle instead of walk the walk. Obama too! Fire these people, just don't tell the American people how disgusted you are. Fire the bonus doer's and then we can watch their lawyers sue the crap out of this administration. Maybe then the American people will find out who is really responsible for this mess.

it's flat time for obama to put his action where his mouth is.i don't care how angry he say's he say's he is. action talks b@#* $@#* walks.I f i remember correctly they all had lavish parties when they got the first bail out package.ACTION MR PRESIDENT,ACTION.

I fail to see how this is Obama's fault. The mess with AIG is a direct result of a failure by anyone in any government to regulate the biggest financial market in the world: Derivatives. Derivatives now dwarf all the worlds' stock markets, bond markets - they are even bigger than Global GDP. There was not a single Leader who thought that maybe we should regulate this ???? The best part is for the most part, these derivatives are little more than Vegas style bets on what might happen!

Very few people wanted to understand why housing prices rose 200% while CPI and wages stayed the same. No one asked why the banker, who in 1995 wouldn't give you a visa card, was throwing money at you because you had a SSN and a pulse (maybe the second one wasn't that important). Certainly no one worried about where all this money was comming from, how the Fed and the Banks created this Boom from nothing. In the ashes of this mess we see that at the center was AIG.

Lots of people here are advocating letting AIG go bankrupt - to put it simply, AIG is the most important company in America. Without their "Insurance" products the entire US banking system would have failed, as well as most European banks. So if we were going to save our Federal Reserve, our Commercial banks, we had to save AIG.

There is lots of blame to spread around. Frankly, our entire banking system is a big ponzi scheme to begin with. We can only hope that this crisis will move leaders to fix the global monetary and banking system which has long since outlived its usefullness. But until someone figures out and implements a better system we are stuck with this mess - and AIG is key to holding it together. The only question that remains is why our leaders continue to maintain this charade of "private ownership" of this companies. Had AIG been nationalized in September we wouldn't have these problems.

This ridiculous outrage about nationalizing banks clearly demonstrates how little most of us understand about Banking. Banks aren't competitive capitalist companies - they are a government backed cartel that controls our money supply. Much like the Post Office or the Parks service. They cannot be allowed to fail, because they create virtually all of the money - much like a monopoly utility they control all the variables of trade with their product - our money. Finally, there is virtually no risk in operating a bank, since the government, for whom they act as an agent, is ultimately responsible for their liabilities.

Therefore, nationalizing banks in this situation is not only reasonable, but prudent. Banks claim to operate as private enterprise is merely a ruse to disguise obsence profits generated from providing what should be a public service.

Not another dime for AIG...

its time for others to take a loss, not just the taxpayers of the USA

Their insurance products are going to cost us trillions. We do not have that much money!

The GOP outrage is interesting since it is the Republicans who enabled the completely unrestricted and unregulated trading in derivatives. Kinda sounds like Craigs's denouncement of gay marriage and Foley's denouncement of pedophiles, doesn't it.

OK, so we bi*ch and moan and write and E-mail and get virtually nowhere. So which states voters are going to be the first ones to recall their representative(s) that has/have shown themselves to be deceitful, in collusion, or incompetent. If anyone has a better method for telling congress that we are not whiny, we're outraged, I'd really like to hear it. Waiting almost 2 years to start sending that message with the vote is unacceptable. Civilizations have risen and fallen in less time. It also has the advantage sending a message to every other member of congress not recalled that 1) they are under scrutiny like never before. 2) The fact that they are still in office is because due to apathy, partisanship, or we just haven't gotten around to them yet. 3) Those still in office after the dust settles are but one non-representative or deceitful vote away from the same fate. For all those who voted for change, they forgot to tell you that there are just some things in life that we have to do ourselves, government can't or won't do it for you.

I say "IF" we have to save AIG then we FIRE the incompetent CEO's that put us here and let the government run the darn thing. Doesn't the government already own the better part of AIG. The people in power don't care about us little people...they have their hidden money and be damned with the little guy.

There are 3 problems with THE AIG MESS:

1. Immediate need for regulation of Derivatives, Futures and commodities trading under the SEC or some other body.

2. Immediate creation of a SEC type body (not an SRO or industry group) to lisence, oversee and police Mortgage and consumer credit entities. The FDIC could do this, but it is currently outside of their mandate - the taxpayors need to have some protection from this "industry".

3. The transiton from the Federal Reserve Fraction banking system into a full reserve, US note system. Monetary policy needs to be managed by government for public benefit, not corporations. In line with this needs to come transparent lending, credit reporting and collection practices that are universally applied - and the end to subjective, clandestine practices by lenders.

We have all witnessed the importance of credit and capital markets. Even without a single mutual fund, bond or share, the current crisis has effected virtually everyone. The big question is: Is government doing all it can to ensure that these markets are functionaing to benefit the public? The answer to this question is clearly no. Banks, brokers and lenders have operated in a legal greay area for far too long.

There is virtually no oversight in these areas, no enforcement, no ethics. The biggest problems is that since these guys are in the business of creating the nation's money supply, they have virtually unlimited resources to influence government, media and even us by buying us off with our own money. We must demand that our currency is only used for the benefit of Average Americans.

duh,,no brainer..the AIG contracts s/b null and void..the contracts, written before the bailout..suffered a great loss, thus making the contracts worthless !!..then after that fact of bailout money..the UNITED STATES GOVERMENT, should have the upper hand, due to more than 80% ownership/ investor...Come AMERICA, this stupid,,,,where's the common sense ???.................

AIG receives $180 billion in taxpayer funds - suffers the worst first quarter loss in history ($61.7 billion) and pay's $450 million in bonuses. The administration and congress express outrage after the public raises a stink but yet the administration continues to negotiate an additional $30 billion taxpayer funded loan for these bums. What the ...

How can the administration express oturage and then offer an additional $30 billion loan to AIG? Either your outraged and you let them fail or you accept their outrageous and reckless behavior in which case you are just as reckless.

Sgt Doc

I couldn't agree with you more that this company and others have been allowed to operate with no regulation or oversight for so long that they have literally become "too big to fail". This is really the root of the problem, and must be curtailed, or we will have more of these monster companies than we do now.

Relative to getting a loan, AIG is primarily an insurance company not a bank or mortgage broker. But the money they owe to banks is for lending. That's one of the reasons we gave them bailout loans, so they could pay their debts to the banks that should be making loans, like the other monster band, CitiBank.

Of course, now that these banks are being paid what they are owed, will we see credit flowing again? Your guess (or anybody's) is as good as mine. I know I have no faith in Citibank. This is a true bank but they have never been a "community-minded" monster corporation, but more of a Godzilla-like entity, more intent on gobbling up other corporations, especially small store credit card issuers, like Sears, and then doubling the interest rates and fees, than in providing any customer services. Sears has a class action suit against them for this practice. I don't know how many others are in the same predicament.

AIG is an insurance company, not a bank. It does not lend money.

The CEO of AIG should be very publicly prosecuted for misappropriation of Federal Funds ! !  The Feds should take total control of AIG and terminate the Upper Management, regardless of which country they reside.  Stop the payments to foreign Banks and Companies,  US Middle Income Taxpayers can't support to world.  If AIG fails, so be it ! !  Now I realize Comrade Pelosi may have a problem whit these actions because her husband (Who has connections with AIG) could be one of the people arrested and charged with misappropriation.  Pelosi could have a problem if she knew about the foreign bank loans and the bonuses that AIG gave staff.

Your bailout money went to these bonuses. Even a blind squirrel can figure that one out? Frankly and Johnnly have come to town, along with Jesse James and the Younger gang. Of course by name they are Peloski, Reid, Franks, and Hussein Obama?

So what's the difference between this and your lawmakers who didn't even read the last two stimulous and pork laden bills without even reading it?

I'm not a Democrat nor a Republican but I think it's time for some of these lawmakers to hit the road jack!

(Rep. Barney Frank charged that a decision by the financially strapped insurance giant, which is 80 percent owned by taxpayers, to pay millions in executive bonuses amounts to "rewarding incompetence." )

JoeB-460595

If only that can happen!

I'm not going to hold me breath though.

The greed runs deep.

There are two stories here that people seem to miss.

1. AIG was operating the largest insurance company in the world completely oblivious to the risks they took. Think about that. That's like the army being run by 5 year olds. Insurance is one of the most important underpinnings of the economy because it assures business that their risk can be covered. AIG was covering more than the economic output of several companies combined in exchange for an absurdly small premium. This kind of leverage underpins this entire economic crisis and suggests that even when everything is 'back to normal' we'll have another crisis, maybe even worse.

2. AIG said their hand was forced to pay the bonuses by lawyers. Lawyers, in effect, are running this country- into the ground. They had to know the decision would be unpopular and even unproductive but lawyers made threats and they caved. I have a couple of problems with their decision. First, they are likely to have their own lawyers on retainer who would have fought the action, but I guess it's hard to fight a mutiny- still, where's the effort? Second, who exactly were these outside lawyers representing? Which exec called up a lawyer and said 'I'm entitled to this multi-million dollar bonus'? Self-preservation is important particularly when you think you may be up on the chopping block next week but where's the faith in the company and how much longer does AIG need to be running with this person or persons on board?

Thus, the entire financial system is rotting from within due to non-transparent, omnipresent leverage and small legal interests. What future does our economy have when it's rotting from the core?

Just keep paying your insurance premiums and putting money into your 401K- and try to sleep soundly.

Moving Out- you missed another item... or two...

these CDS's (credit default swaps) were apparently sold last year... I mean they arent paying on performance from 2-3-5 years ago...

Some companies have bought CDS for years, if so they should be honored... HOWEVER, last year EVERYONE knew the Mortgage Collapse was coming, YET the nut jobs at AIG still SOLD Insurance (CDSs) to them !!! How hard was that to sell ? The Janitors could have sold it !!!

Who gets a bonus for selling Insurance to someone after they've already crashed their car...? or in this case CRASHED THE U.S. & Global Economies!!!

F'n insane...

Best of ALL , Frances bank gets $11.9 BILLION, German Bank gets $11.8 Billion and English Bank gets $8.5 Billion...$32.2 BILLION !!! How about those GOVERNMENTS pay US back !!!

STOP THE blame OBAMA , Pelosi crap... THIS IS ALL from BUSH handouts...!!!

However I dont care to waste time fighting amongst ourselves...

How about calling AIG & Treasury Dept (number above see my post 1.90)

Two words, Force Majeure. There's no reason why the government couldn't use this to cancel the retension bonus or other bonuses that AIG states it was contractually obligated to pay. It seems like the need for bailout money qualifies as an extraordinary event or circumstance?

That or maybe they could use other non-performance arguments. It seems like there should be an easy way out.

Pinch / Bill / and a bunch o' y'all up there and down there:

AIG lends money. It also invests in real estate development as all insurance companies do. The largest developers of commercial real estate in the world are insurance companies, (as they consider real estate to be a safe investment, hah!). Read and become wise....

http://www.aig.com/loans-and-credit_20_20687.html

http://www.aig.com/financial-services-business_20_16525.html

http://www.aig.com/investment-services_20_20696.html

Good Luck!

If the tax payers already own 80% if AIG we should have a majority of the seats on the BOD. The government should make the BOD allow these seats to be filled with people from both political parties with banking and financial experience. The house or the senate should have the power to chose these people and place them on the BODs of all the banking institutions that we have bailed out. Its our money, we should have our own people there to look after it.

I don't think AIG gives a rats back side about anything we think, but I agree with you about your other comments.

All citizens who are concerned should write to our elected officials.

RICK

Liddy took the job in September 2008 after a string of previous CEOs had been let go for various non-favorable performance reasons. Liddy was encouraged into this job by the government as well as economists of all political stripes. He works for $1.00 (yes, one dollar), no bonuses, no extras. He has encouraged with some success his executive circle to do the same. He has suspended dividend payments on common and preferred stock. He is working with the government to find a way around these contracts.

I really don't think he is the problem.

Rick: I have written to my reps. They don't respond.

If we bought the rest it would only get worse. Our elected officials are just as crooked as these people. Many people are being paid off down the line for this kind of thing to happen. This country deserves to fail because we are being led by scum.

PINCH understands - the top 50 in AIG are getting no bonuses at all. It is the 2nd and 3rd tier that are benefiting. Liddy needs to exert excessive pressure on these management tiers to get them in-line. That is his job!

The excuse that they will lose talent is hogwash! Are these finanical guru's going to work for Bear-Stearns or Lehman Brothers? There is no where to go!

No, they won't work for Leman or Bear. They will work for AXA, a large French insurance company, or Allianz, a large German insurer.

So what's the difference between this and your lawmakers who didn't even read the last two stimulous and pork laden bills without even reading it?

I'm not a Democrat nor a Republican but I think it's time for some of these lawmakers to hit the road jack!

(Rep. Barney Frank charged that a decision by the financially strapped insurance giant, which is 80 percent owned by taxpayers, to pay millions in executive bonuses amounts to "rewarding incompetence." )

Rewarding incompetence. That's pretty funny coming from Frank whose whole career has been a reward for his incompetence and malfesence.

CHANGE...................ROTFLMAO!!!!!!!!!!!!!!!!!!

Bill if they do for the french company what they did for AIG woooooooooohooooooooooo You really think the want the once that started this whole me I don't think so.

O'Bama, they played you for a fool. You're the President, you have the authority of the Federal Gov., take action and close these fools down. Comrade Pelosi, your husband is now unemployed, remember he has to seek employment from no less than 2 prospective employers every week. And of course there will be a 10 week penalty for having a crook as a CEO at AIG. In addition, it will take 6 additional weeks before you get your 1st Unemployment check (if we don't loose your records).

Jake J

I am truly just as angry as anyone else out there, and as you imply, this isn't just about AIG, although I think this has focused people's anger. This is the failure of the government, starting decades ago, to regulate the growth of monster conglomerates who have now become "too big to fail", because the domino effect would cause a global depression.

No single entity should be allowed to get this large and diverse with no regulations and no oversight. We should have been this angry a generation ago when this was still easily controlled.

No one is held accountable, goverment is just as crooked (9000 ear marks). I have written to my reps and no response, i would probably get a response if I praised them.

Im done, I no longer care, all my cash is safely at home and can give a rats a$$ about this country! I have had enough of Illegals, theiving companies and crooked goverment.

WE HAVE NO VOICE IN THIS COUNTRY ANYMORE!!! the next one we elect in office will be just as bad, look at Arnold the tax raiser...

Term limits for Congress, 2012. Time to end all career politicians in Washington.

Earmarks, pork, congressmen and women who aren't even reading the bills before they vote to pass them. I agree. It's time to end all career politicians in Washington, and folks like moveon.org and other PACs need to go...

So what's the difference between this and your lawmakers who didn't even read the last two stimulous and pork laden bills without even reading it?

I'm not a Democrat nor a Republican but I think it's time for some of these lawmakers to hit the road jack!

(Rep. Barney Frank charged that a decision by the financially strapped insurance giant, which is 80 percent owned by taxpayers, to pay millions in executive bonuses amounts to "rewarding incompetence." )

Jake J - There are some that have been angry, or at least worried, for several generations.

Well the DNC is basically now the National Socialist USA Workers' Party. Obama should from a Nationalized And Socialized Industries cabinet position, the NAZI, I mean NASI position.

sunnyone

Liddy took the job in September 2008 after a string of previous CEOs had been let go for various non-favorable performance reasons. Liddy was encouraged into this job by the government as well as economists of all political stripes. He works for $1.00 (yes, one dollar), no bonuses, no extras. He has encouraged with some success his executive circle to do the same. He has suspended dividend payments on common and preferred stock. He is working with the government to find a way around these contracts.

I really don't think he is the problem.

If we let them go under, we the taxpayers/shareholders will have wasted our 80%. I agree with Rick-331120 - our government should invest the other 20% to take over AIG and then FIRE these 'best and brightest'.

Unfortunately, the problem is who do we replace them with? No one person, even highly-placed people at AIG really have a total picture of the extent of AIG's rampant invasion into the entire global economy. For example when you have a company that has a controlling share in a foreign airline through one division, also leases planes to that airline through another division, and underwrites the insurance to the airline through yet another division in one of the biggest economies in the world, and that type of scenario is repeated in country after country, you begin to realize that the term "best and brightest" should really be "those who know what's going on".

Let them fail then break them up like they did with Ma Bell some year back.

Harry

Your theory is spot on, particularly the reference to Ma Bell. But to protect ourselves (and everybody else in the world) we need to do it the other way around.

First we need to find the actual boundaries of all the divisions, and then we need to divide them up and let each one rise and fall as its own merits (or lack thereof).

I agree with you pinch. Maybe my wording should have been better but I am mad enough to chew up railroad spikes and spit out carpet tacks and when that happens sometimes what i want to say does not come out right.

Hard question, do we just go ahead and have a horrible depression anyway rather than help the government avoid it with just a bad recession? Can we trust anyone? In my mind, who can anyone in America or anywhere else trust anyone with any of their earthly assets?

m k

Unfortunately, this talk is true. We are reaping the results of decades of unregulated growth of the world-wide monster conglomerates, who are now in a position to call the shots or instigate a global depression. I don't think either the previous administration or the present one has a clue about how to safely unravel these totally unsupportable entities, but our and other countries' very survival may depend on someone figuring this out.

Steve B

I think some of these monster companies have already been doing that.

Already being done as we sit here! In my lifetime, Japan attacks us, we rebuild and give them all of our technology, plus let a bazillion of them move here under refugee status, Korea, same, Vietnam, same, Russians, same, towel heads, same, China same.

steve b we already been doing that for the last ten years or more. We'll never see this mess straightened out at lleast not in my lifetime. When and if this problem is ever fixed we need to stop the state department from giving out "our"yankee/infidel dollars to countries who hate us. What we need to do to show our disgust with the way this new democratic administration is conducting business is if you taxes this year is to not pay them until at least until these bailout profiteers start paying back these loans. Not to worry we'll never see a penny of that money back, down the tubes, never to be seen again. My patience has run out with these idiots.

Yep. The rich keep getting richer and poor keep getting screwed by the rich. Today the old saying rings truer. "It's not what you know it's who you know". even if you finish out that degree you are probably just going to be a janitor or hamburger flipper at one of the local restraunts that are owned by a corporation. If your not one of the HAVES then you will never have unless we the people start buying from our fellow Americans again and keep our money between us, the HAVE NOTS. Start doing your shopping at the local craft fairs, Farmers markets and such instead of the corporations like Walmart, Target, Home depot, Cub, etc. Their are many Americans out their that are gifted. They make, sell, and grow things that will last for many generations to come and are better for you. It might cost a little more but the money goes directly into the public hands and if paid in cash no taxes have to be paid by either party. It goes into the hands of people in your communities who inturn spend that money in their communities. Our money is still worth something to us, The peons. We just have to quit giving it to the government in the form of taxes (about 60% of every dollar earned is paid to taxes in one form or another ie. income tax, sales tax, property tax, etc., etc., etc.) so that they can continue to keep us poor and them rich.

Jodi from Ky: Aha now I see the plan, make it difficult for kids to go to college, offer them 3 years of military service to their country in return for a college education. Radical, why didn't I think of that idea back in 1961 when I first joined, oh wait it was already in place. Now there is some "Change"

Jodi from KY: Please tell it like it is. You chose to quit school and now blame AIG. Your brother chose to join the Navy. Not a single person made him do it. You made these choices - own them. You could have stayed in school and taken fewer hours and gotten a job - any job - to make ends meet. I know because I did it in the early 80s (following the illustrious Carter years) when the economy was much worse than it is now. It was hard, but it was worth it. The government does not owe you or anyone else a college degree. If you want it bad enough, you will figure out a way.

metalworker, they did their job, they took us down, they created a depression. You can call it a recession, if you like but we are living on fumes. Go to the CFR web site and you will see all the reasons why and where we are headed. Go directly to the source and then you will see who our government really is. Honestly.

I couldn't believe it myself. The tune they sing sounds so much different than what is has and is happening. All over the world, they are bullying and threatening and scareing countries into submission. Look and see what other countries are doing and have had to do and why. It's a real eye opener. Believe me, everything that has happened, it all falls into place.

This problem began at least six administrations ago when the barndoor began slowly opening and the government began trusting private companies to "monitor" their own behavior and the "horse" to behave. For the vast majority, that was okay. But the monster institutions began to grow in truly dangerous ways, and with the development of the global economy, they just kept gobbling up smaller companies around the world like peanuts.

These companies are like bullying children, as suggested above. They blatantly lie (like Citibank to Sears), they subdivide for control (AIG with Beijing PanAm), and they don't even keep track of their own "rogue" operations (AIG's New York office allowing a London office to knowingly deal in "junk").

Now the rest of us, including the government, can't even find the horse that got out years ago. We have to have a horse safely in the barn, and no one has even had a clue about how to do that for several administrations, even though they knew the barn was empty. I guess they thought the original horse would come back by itself?

Peter Jacobs: I agree 100%, but these are "Retention" bonuses not performance bonuses. In any case the Auto workers union was forced to make concessions and they have a contract. What makes this different? Because they are not unionized. Force AIG to amend the contracts to eliminate the "Retention Bonuses" if they are going to receive taxpayers money.

The idea of a "retention bonus" is the most rediculous excuse I've ever heard for rationalizing this mess. It's an absolute scam. Try to get your boss to give you a "retention bonus" and see how far that flies. Most people do a good job and don't even get a bonus...period. Yet these corporate barn flies who obviously don't do a good job expect a huge bonus or they won't stay with a company. They apparently think we're all as dumb as cobs and maybe they're right since they're getting away with it week after week. It's all so sad now that justice means nothing.

Gus

Most likely, a class action suit or even suits from individuals for non-payment of the legitimate contractual bonuses to AIG employees would not happen at this point. But if the government steps in and negates these employment contracts, we will have a truly dangerous precedent.

This could mean that the government will now have the authority to alter the employment contracts of any business receiving federal funds. Do we really want that?

Also, lawsuits will only alter where the bailout money goes, not stop it from bleeding out. Scummy lawyers will get it instead of scummy execs, so not much of an improvement.

Good idea, Gus-387868; if they win, the company has no money so the idiots that ran the company into the ground in the first place would actually have to do their jobs in order to get paid.

Also, if the idiots don't do their jobs, they can sue each other for not making the court ordered payments!

How's that for obfuscation?

I definitely agree with you about the Federal Reserve. A lot of people think they are under the control of the government, but in fact they are their own "control" and they extend that to others on a whim.

As for letting AIG fail, we really can't do that and the reason is our own fault for letting regulations erode away starting six administrations ago.

There would be disastrous consequences for millions and millions of ordinary people all over the world if AIG fails. Capitalistic business practices and major world economies on an upswing allowed AIG, among others, to become literally "too big to fail". Failure would not just punish the thousands of lower-tier people employed by AIG, but consider this:

AIG is the world's largest underwriter of commercial and industrial insurance. They are one of the world's top life and casualty insurance companies. They are the world's largest airplane leasing company. They are chief investors in major real estate development activities in dozens of countries all over the world. And the list goes on.

They are not just one company. They have divisions, divisions of divisions, and divisions of divisions of divisions.

No one in the government or in the executive suites of AIG would really be in any financial difficulty if AIG failed. But millions of "little people" and businesses all over the world would be ruined and devastated.

sncknbrg,

tell it like it is. Absolutely! I've been going directly to the sites. I've been doing researh on NAFTA, CAFTA, AFTA, and the FTAA. WHOOGH!!!!!!! AND THE CFR. Banking cartel takeover! Mega-Corp coo. You can kiss your rights farewell under these dogs! Big corporations have the right to Sue a government, if they don't get to come into your country and polute it to the tune of billions! It's infringing upon their rights. It goes on. What are people referred to the "civil ...something, I don't have time to look it up, reseach now!

You are both so right. This is what happens when a government trusts everybody, which started six administrations ago. Over the decades, some people have tried to say things were getting out of hand, and some said "Oh no, everything is fine, Business is booming...". For the most part, businesses behaved. But as the global economy grew into a reality, some of the players took advantage of the lack of oversight and regulation.

Now we have these Frankensteins, and yes, they call the shots because they can shut down the business of the world or major parts of it. And no one of any political stripe seems to know how to stop them.

AIG showed what they were going to do immediately after they got the bailout money by taking all their fatcats on a multimillion dollar resort trip but congress was to dumb to see it. Has congress ever recovered any of the resrt trip money? I dont think so and it is most likely the never will either. Why should they be shocked and outraged now when they find out that a good chunk of the money went to pay overseas banks and now fatcat bonuses?

Frank

They expect us to think as we have through six administrations - to think that they should be allowed to operate according to their rules with no regulation or oversight. That seemed to really disappear after the Ma Bell business. Apparently we didn't feel there would be any more unwieldy conglomerates behaving badly on the horizon, even when the economy began to go global and the fruits were so much more tempting.

What are you calling Bush, Paulson and Cheney. They are the ones that got us in this mess. Get real.

Obama has been in office for 75 days. Bush was in office for 8 years. Put the bong down.

Unfortunately, an AIG bankruptcy would hurt millions of people all over the world and they would just walk away.

Actually it is. The bonuses were actually retention payments, averaging $112,000 per person are going largely to people in sales and it was in their contracts a year ago.. They went to people who exceeded in selling investments which later were discovered to be "junk". The employees didn't know that at the time, and they met the terms of their contracts.

After AIG lost its AAA rating later in the year when the "junk" investment stuff came out, the company's higher ups who "sort of " knew about this were let go, and the company tried to put off paying the bonuses until the last possible legal minute hoping something would turn around. It didn't. It got worse. This was a bad corporate gamble that may punish the wrong people.

And the media is not helping here by using only the sensational pieces and not giving the public the full details.

Common sense would tie bonuses in with having a profit.

Jodi

That's probably been true for six administrations.

Pinch; what kind of fools do you take us for. If your going to sit on the fence and vaccilate then please declare yourself. AIG sales people were selling products and they did not know what they were selling???? I see a seat for you at AIG or better yet on that blue lipped, big eared osamaa cabinet

beca, I hear what you are saying, but that's like using a nuke. It will destroy a lot more than you think.

We, as a people, keep electing people to congress and they continue to play politics with us. There is no reason that we have to continue with the partisan politics we see every day, be it the "no" party or the "we won" party, they do us, the people not good.

We need to take a very hard look at congress 2 years from now and, regardless of party, we MUST vote in the best person we can. We have to stop voting for a party and start voting for ourselves and our children.

We are all angry, and you are right. This is not right, fair, ethical, moral, etc. But we have allowed this type of stuff to go on for six administrations. The people who are getting these bonuses had a contract a year ago before anyone knew the extent of this meltdown mess. They were hired to sell, not question what they were selling. And there were more than enough buyers. They sold at or above the level set for them to receive the retention bonuses. The people who might have suspected that this was not all squeaky clean are for the most part long gone. But the ones with these contracts, which they met, are left facing our collective anger.

How do you know, Pinch, have you seen the contracts?

Pinch -

If it wasn't for the government and us giving almost 200 billion to AIG, they would have bankrupt. If they did go bankrupt, these contracts would be null and void. Technically, these employees are very lucky to just still be employed.

Technically, these employees are very lucky to just still be employed.

As I understand it, the government owns 80% of AIG following all the bailouts and surety pledges. As majority stockholder in AIG, let the United States send this message to executives lined up for bonuses: accept a bonus and consider it severence pay ~ and that also extends to the "executive(s)" who sign the check or approve the money transfer. Moreover ~ ~ ~ treasury, FBI, and IRS agents will live in your ass for at least five years. Sometimes its not the message ~ its the way it is explained that gets results. If we had someone in congress or the White House with a single hair on his butt, this message would be delivered before 5:00pm today.

Right, We The Peop[e DO own 80% of AIG. So as the majority share owner, HOW do we force a sharelolders meeting fast and demand, among many items, the dismissal of the top 5 corporate board members and the abbrogatipn of all outstanding AIG contracts and let Paulsons protege renegotiate each one???

We are headed back east in June on vacation (we have been saving money in a coffee can for this for quite a while). Anyone want to meet us in Washington? we will be there about the last week of June. Hope to see you all in front of the capital and the White house.

Another good idea; only let's not gather on Anacostia (sp?) Flats ;-P