About That AIG Resignation Letter
The right wing blogosphere is all atwitter at the moment about the resignation letter of AIG executive Jake DeSantis, published by the New York Times. The outpouring of conservative sympathy and outrage about DeSantis's treatment is really quite revealing.
I should start by noting that I too sympathize with DeSantis. If, as he says, he played no role in the collapse of AIG and he was repeatedly promised this compensation in exchange for staying on, then he got a really raw deal. He and many at his unit have been unfairly vilified, and I'd be pretty mad if I were him too.
But the reality is this: when companies fail, lots of innocent people get screwed. Lots of promises aren't kept. That's why companies declare bankruptcy: because they can't afford to live up to their promises. Had the government allowed AIG to fail last fall, DeSantis wouldn't have received anything. He'd be like many other people who woke up one morning to find their lives turned upside down by this recession. On second thought, given that Mr. DeSantis can apparently afford to give his entire $750,000 bonus to charity, I suspect he'd be much better off than most people who have suffered through the failure of their employer.
It's striking to me that the very same people who are outraged by DeSantis's treatment showed no sympathy at all for the nation's autoworkers. In fact, they were angrily demanding that these workers (who make a small fraction of what DeSantis makes) agree to give up their "luxurious" health benefits and agree to salary reductions. These workers too had been promised things by their employers, but their complaints fell on deaf, even hostile ears. If their companies were going to be saved by taxpayer money (at a fraction of the cost of bailing out AIG), well these workers were just going to have to suck it up and take the hit.
The fact that the plight of a millionaire executive (one who actually received his promised bonus) elicits such sympathy from the Right, but the plight of blue collar assembly line workers doesn't says a lot about the ideological prism through which many conservatives view the world. They simply identify with DeSantis in a way they don't with many of the other victims of this recession.
UPDATE: In the comments Tom Maguire writes:
I'm not a fan of the way Congress has dealt with the AIG bonus controversy, and I know that if I were in Mr. DeSantis's shoes, I'd be pretty pissed off too. But the reality is that even if he didn't personally contribute to the bad investment decisions that brought down AIG, he certainly profited from them, handsomely. And though he may not get to keep his promised compensation for this year, that's what happens when companies fail. It sucks. But it sucks a lot less when you're already a millionaire. There are a lot of victims of this economic downturn, and most of them have gotten a much rawer deal than this guy.
I should start by noting that I too sympathize with DeSantis. If, as he says, he played no role in the collapse of AIG and he was repeatedly promised this compensation in exchange for staying on, then he got a really raw deal. He and many at his unit have been unfairly vilified, and I'd be pretty mad if I were him too.
But the reality is this: when companies fail, lots of innocent people get screwed. Lots of promises aren't kept. That's why companies declare bankruptcy: because they can't afford to live up to their promises. Had the government allowed AIG to fail last fall, DeSantis wouldn't have received anything. He'd be like many other people who woke up one morning to find their lives turned upside down by this recession. On second thought, given that Mr. DeSantis can apparently afford to give his entire $750,000 bonus to charity, I suspect he'd be much better off than most people who have suffered through the failure of their employer.
It's striking to me that the very same people who are outraged by DeSantis's treatment showed no sympathy at all for the nation's autoworkers. In fact, they were angrily demanding that these workers (who make a small fraction of what DeSantis makes) agree to give up their "luxurious" health benefits and agree to salary reductions. These workers too had been promised things by their employers, but their complaints fell on deaf, even hostile ears. If their companies were going to be saved by taxpayer money (at a fraction of the cost of bailing out AIG), well these workers were just going to have to suck it up and take the hit.
The fact that the plight of a millionaire executive (one who actually received his promised bonus) elicits such sympathy from the Right, but the plight of blue collar assembly line workers doesn't says a lot about the ideological prism through which many conservatives view the world. They simply identify with DeSantis in a way they don't with many of the other victims of this recession.
UPDATE: In the comments Tom Maguire writes:
I do feel bad for the blue collar guys stuck in dying industries but propping the firms up up while they refuse to restructure and deal with reality is not a sensible long term solution for the auto problem.But the same exact thing is true of the finance industry. In its current form, it is completely unsustainable; its profitability was illusory, the product of a massive credit bubble. In the post-bubble era, there will still be a finance industry, but it will provide jobs to far less people and at far lower compensation levels. Mr. DeSantis is no different than an autoworker; he's someone who works in an industry that is massively contracting and for a firm that would have gone bankrupt but for the intervention of the federal government. And if that had happened, he would have had to get in line with all of AIG's other creditors.
I'm not a fan of the way Congress has dealt with the AIG bonus controversy, and I know that if I were in Mr. DeSantis's shoes, I'd be pretty pissed off too. But the reality is that even if he didn't personally contribute to the bad investment decisions that brought down AIG, he certainly profited from them, handsomely. And though he may not get to keep his promised compensation for this year, that's what happens when companies fail. It sucks. But it sucks a lot less when you're already a millionaire. There are a lot of victims of this economic downturn, and most of them have gotten a much rawer deal than this guy.
posted by A.L. at 12:16 PM
42 Comments:
Now I'm really curious. What were his responsibilities?
You overlook the fact that he was working for a salary of $1 for the last ten months. So if the auto workers had been working for free for the last ten months and then had their promised benefits taken then you would have a point.
You overlook the fact that he was working for a salary of $1 for the last ten months. So if the auto workers had been working for free for the last ten months and then had their promised benefits taken then you would have a point.
I didn't overlook that. But remember that 1) Santis got his promised bonus (no one has taken it away, at least yet), and 2) if AIG had gone bankrupt last fall, DeSantis would have been in even worse shape.
More importantly, though, my point is not to malign DeSantis or to praise Congress's reaction to the bonus situation. My point is merely that I find it revealing that DeSantis's story seems to elicit so much sympathy and outrage from folks who don't seem to care at all when the same thing happens to less wealthy people.
My point is merely that I find it revealing that DeSantis's story seems to elicit so much sympathy and outrage from folks who don't seem to care at all when the same thing happens to less wealthy people.
That is so ridiculous. Those whom you say show no sympathy to autoworkers are in fact quite sympathetic to the autoworkers. Those we have no sympathy for are the employees of the UAW who claim to represent the autoworkers, but in fact seem only to work to enrich themselves as employees of that union; it was the UAW that was initially avoiding renegotiating a contract that was as much a part of GM's problems as was GM's management. If anything, the union was putting the jobs of the workers, those they claim to represent, in jeopardy.
Plus, I don't remember a busload of activists going to the house of the UAW President to harass and threaten him as was done to those who work for AIG.
The point is, the company SHOULD HAVE FAILED. He shouldn't have gotten anything, and us taxpayers (including those autoworkers) shouldn't have payed a penny for the stupid company.
Bailing them out went against our entire system and human nature at its very core. Pointedly, it was stupid.
"My point is merely that I find it revealing that DeSantis's story seems to elicit so much sympathy and outrage from folks who don't seem to care at all when the same thing happens to less wealthy people."
Maybe the dividing line is over the process rather than the net worth of the people involved.
The unions were free to refuse any concessions and try their luck in bankruptcy; DeSantis was explicitly told he *would* be paid, and wasn't. Is it OK if that distinction bothers me?
The UAW isn't even pretending that their members could get comparable pay elsewhere; it is highly likely that DeSantis could land on his feet elsewhere (or could have last March 2008 when these bonuses were agreed) - is it OK if that bothers me?
Or maybe I am just not a big fan of unions. Their strikes disrupt the economy and hurt plenty of working class people on the periphery of the strike.
And their raison d'etre is not to increase productivity and grow the pie; their entire point is to re-slice a pie that will probably shrink after they impose a million work-place rules.
From which it follows that however I feel about working class people, I am not a fan of the union process. Surely that political argument is not new to you? Do you really suppose that conservatives dislike anyone that is not rich? How unimaginative.
Well. Since it is all about relative net worth, I am now outraged that lefties are fretting about card check and the UAW give-backs when there are starving children in Africa. Talk about misplaced, greedy, illiberal attitudes...
Tom Maguire
The point is, the company SHOULD HAVE FAILED.
The morality of saving AIG isn't as clear as you suggest. I don't think anyone questions that AIG deserved to fail. But very smart people (including Krugman and others) believed at the time that if AIG was allowed to fail, there would be massive collateral damage throughout the economy. Lot's of innoncent people (including millions of people who don't work for AIG) would be hurt by it.
You can't judge the wisdom or morality of bailing out AIG in isolation. You have to look at the overall picture.
"Had the government allowed AIG to fail last fall, DeSantis wouldn't have received anything."
Actually, that's just plain false.
It's routine - repeat, routine - in Chapter 11 bankruptcies for judges to approve big retention bonuses for key employees, who have good prospects elsewhere and would otherwise be inclined to jump ship. And this practice is rational, because retention of such employees is necessary to turn the company around, and eventually pay off secured creditors.
In the case of AIG, the creditors are all of us - every American taxpayer - and the populist idiocy (stoked by Congress and the Media) causing the AIG clean-up crew to jump ship makes it less likely that we will ever recover the many billions we have sunk into that company.
Zokar,
What makes you so sure it would have been chapter 11? Given the size of the debt, chapter 7 seems more likely.
And even in chapter 11, it's very likely the AIGFP division would have been closed in a heartbeat.
The unions were free to refuse any concessions and try their luck in bankruptcy; DeSantis was explicitly told he *would* be paid, and wasn't. Is it OK if that distinction bothers me?
Actually, DeSantis was paid. And the retention bonus was negotiated in March 2008, prior to any talk of AIG's bankruptcy. He AIG been allowed to fail, he too would have been "free to try his hand in bankruptcy."
And yes, Tom, I do think that a major cause for the lack of sympathy shown to autoworkers is conservative knee-jerk antipathy to unions (and by extension, union workers). I get that Republicans don't like unions, but in the same way that liberals are often guilty of demonizing corporations without considering the regular, decent people who work for them, conservatives quite often demonize unions without considering the regular, decent people who are members of them.
I sympathize with DeSantis. I really do. But I don't think he has endured anything all different than anyone else who's been hurt by this economy.
if the auto workers had been working for free for the last ten months and then had their promised benefits taken
Right. That never happens to union employees.
Actually, that's just plain false. It's routine - repeat, routine - in Chapter 11 bankruptcies for judges to approve big retention bonuses for key employees, who have good prospects elsewhere and would otherwise be inclined to jump ship.
Believe me, I know how this stuff works. But remember that DeSantis' bonus was negotiated in March of 2008, well before the entire financial industry imploded. By the time AIG went bust in the Fall of 2008, the market value for people like DeSantis was much, much lower and job prospects were limited at best. It's entirely possible (though by no means certain) that a bankruptcy judge would have authorized a retention bonus for DeSantis's services, but I highly doubt that it would have been anything close to what AIG had agreed to pay him in March 2008.
So, in summary:
1. If you say that an executive's salaray is too high, then you're a communist.
2. If you say that a worker is paid too much, then you're a Republican.
Seriously, the GOP solution to the economy is to make sure that millionaires stay wealthy while calling for blue collar workers to take, in essence, a permanant pay and benefits cut? You do realize that by lowering the median wages of SKILLED workers, then the effect on the wages of UNSKILLED workers will be catostrophic as well? And this drop in real wages will benefit the country in the long run how again?
I would honestly have a perverse respect for Republicans if they simply flat out said that they would enact legislation banning the right to collective bargaining. If you hate unions so much, then make them illegal, and let your political chips fall where they may...
I'm not pretending to be an expert on all the intricacies of corporate bankruptcy, but I do know that the decision of Chapter 7 v. Chapter 11 turns in significant part on whether the bankruptcy estate has greater value liquidated (7) or as an ongoing concern (11.)
With AIG, it would seem that offloading all of its toxic assets bring something like "fire-sale" prices, while a slower unwinding allowed by chapter 11 (or by no bankruptcy & a government bailout) would fetch better prices. I can't find the testimony right now, but Liddy (AIG's new $1/year CEO) has told Congress that the Financial Services Division has over the course of about a year already reduced AIG's liabilities by the hundreds of billions, maybe over a trillion.
Plus, AIG's traditional Insurance divisions continue to make money, another factor in favor of Chapter 11, not 7.
But even with my ignorance I know this would likely be the most complex bankruptcy ever, with jurisdictional problems too because of AIG's international units and contracts.
"...maybe I am just not a big fan of unions. Their strikes disrupt the economy and hurt plenty of working class people on the periphery of the strike."
But you're a big fan of financial services divisions embedded in insurance companies, whose antics bring the entire world to its knees?
I agree with the author: everyone who cries over the sanctity of millionaires' contracts tells unions that the deals they reach should be tossed aside whenever it suits them, and that indicates an ideological obsession rather than a principled stance on contracts.
AL,
DeSantis was an executive vice president of the very same division that failed at AIG.
His hands are far from clean. In fact, his underlings were the ones who devised some of the products that took down the firm.
"And yes, Tom, I do think that a major cause for the lack of sympathy shown to autoworkers is conservative knee-jerk antipathy to unions (and by extension, union workers). I get that Republicans don't like unions, but in the same way that liberals are often guilty of demonizing corporations without considering the regular, decent people who work for them, conservatives quite often demonize unions without considering the regular, decent people who are members of them.
I sympathize with DeSantis. I really do. But I don't think he has endured anything all different than anyone else who's been hurt by this economy."
Knee-jerk? Conservatives have been expressing their problems with unions for decades.
As to "conservatives demonize unions, libs demonize corporations", I think we are all quite clear that the AIG bonuses were being paid to *people*, not corporations.
At to whether the death threats and seppuku suggestions directed at AIG were typical of the pain people experienced in this recession, yeah, whatever. Their actual financial pain is surely less.
My larger concern is the process. I do feel bad for the blue collar guys stuck in dying industries but propping the firms up up while they refuse to restructure and deal with reality is not a sensible long term solution for the auto problem, IMHO.
AS to AIG, as even our President notes not all financiers and businessman are crooks and we will probably need their participation to recover from this mess. Congress does not help with their "a deal's a deal unless we get outraged" approach.
SO - I think in the long run the best thing for the auto industry is a dramatic restructuring, including lower labor costs and more flexible work rules; consequently I am sympathetic to calls for union give-backs.
As to AIG, in the long run the rule of law, honoring contracts, and punishing the guilty rather than random bystanders will be valuable principles on which to rebuild our economy. So I oppose the AIG demonization. You are the one dividing it on class lines, not me (and since you are just hypothesizing randomly, why not hypothesize that it is black membership in unions that explains the conservative position? Its no more logical, but a lot more inflammatory.)
But you're a big fan of financial services divisions embedded in insurance companies, whose antics bring the entire world to its knees?
I assume this non sequiteur is wilfull.
Tom Maguire
Zokar,
I absolutely agree with you that it would have been a nightmare because of the international angles, and -- just to make it perfectly clear -- I wasn't criticizing your comment, I was honestly asking why you thought chapter 11 was more likely than chapter 7.
Tom, just because Republicans have long hated unions, doesn't mean they don't react to issues involving unions in a knee-jerk fashion. Indeed it explains why they do.
But that's really beside the point. you write:
I do feel bad for the blue collar guys stuck in dying industries but propping the firms up up while they refuse to restructure and deal with reality is not a sensible long term solution for the auto problem
The same exact thing is true of the finance industry. The salaries being paid to people like DeSantis are completely unsustainable. They were the product of a pro-longed period of crazy speculation and bubble-building (exactly analogous to the deals the Big Three struck with UAW during boom times). A new post-bubble equilibrium needs to be reached. The finance industry going forward will simply not generate enough revenue to sustain as many finance guys at such a high salary. I really don't see how DeSantis's situation is any different than a UAW worker. Both had benefits promised to them by companies that were effectively bankrupt. So why the very different conservative reaction?
Aren't we missing the real issue here? The reason DeSantis is giving his bonus away is to make the point that it is not the financial damage that is most important to him, but the fact that he and his fellow employees have "been betrayed by A.I.G. and are being unfairly persecuted by elected officials." He points in particular to the disgraceful conduct of Attorneys General Cuomo and Blumenthal who, to advance their own political careers, are threatening to publicize the names of AIG employees who refuse to return the money.
Although I haven't read the blogs AL may be referring to (other than Volokh), I suspect that it is this abuse of power issue, rather than some class-based sympathy for Mr. DeSantis, which is driving their reaction. And I would add that DeSantis's letter seems to have struck a chord with people regardless of political inclination, based on comments from some of my friends.
"he certainly profited from them"
You do not know that. I agree with you for the most part. But huge companies, and have profitable units, and a bad unit, unrelated, can bring a company down.
You do not KNOW "he certainly profited from them".
You do not KNOW "he certainly profited from them".
He was an executive in the financial products unit of AIG. Even if he wasn't directly involved in the issuance of credit default swaps, those products made a lot of money for AIGFP (at least until the housing bubble burst). Whether directly or indirectly, his compensation level was correlated with the profitabilty of AIGFP.
I realize that the AIG exec who wrote the NYT op-ed has a reason to be pissed. However, I'd much rather he be pissed than the man or woman who is responsible for the steering linkage or brake assembly on my Chevy or Ford. It's one thing to lose some money because of a disgruntled employee, it's another to lose my life or the life of a loved one.
T.M. said:
My larger concern is the process. I do feel bad for the blue collar guys stuck in dying industries but propping the firms up up while they refuse to restructure and deal with reality is not a sensible long term solution for the auto problem, IMHO.
You mean the process whereby AIG lied to the media last year saying that nobody in the FP division was getting the bonuses. And the process whereby the AIG CEO stonewalled Congressional inquiry into the bonuses at a time when something could be done about it?
"if AIG had gone bankrupt last fall, DeSantis would have been in even worse shape."
Or he would have been working somewhere else for a decent base salary and bonuses
"Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you."
Well done, A.L., one of your best and most discerning posts ever.
I think Christ's comparison of the widow's mite and the rich man's gold piece is relevant here.
the republicans are the band on the titanic.
Great analysis A.L.
The problems faced by the auto workers and the Wall Street workers are similar. Except that in the case of Wall Street the timeframe is much shorter and the entitlements are much greater.
Wall Street will always continue to demand huge bonuses and paychecks. And hold the economy hostage if their entitlements are not provided.
I am rather amazed at everyone here. I put myself in the position of these people who worked at AIG and the workers at GM. What if I had worked for 10-15 hours a day, for free essentially ($1) based on the idea that I would receive a payday at the end of the year.
I also had the foresight (because I could see the turmoil around me) of asking will I actually get paid? The govt. and my execs assured me that I would. So I stayed. I could have left at any time (I am a well trained UAW worker or an AIG exec) to take another job, either equal or less paying. But I was assured that our pay was secure, and for us to leave would only create more turmoil and truly doom the company (GM or AIG). So you stay. Now that the amount of your pay is being partially disclosed (though NOBODY wants to talk about the $1 you got for the 3000 hours you have put in over the past year)a bunch of very pompous congressman who rammed the stimulus pack up our collective rears ("we don't have time to read it") feign outrage. They were aware of my pay arrangement, but choose to forget it, and not disclose all of it. Though they threaten to disclose my pay and my name to an angry mob public. This is the same group of congressman who created, protected and denied most of the mess. This is the same group of "leaders" who asked you to work (as a patriot) for the good of the economy. Now that the public is outraged, they want to tax it ALL. I think we all have a right to be outraged, but not at AIG or the UAW worker, they both earned the wages they were being paid.
The real issue is congress and our president. If we assign this philosophy of punative taxing to the group who truly created the mess, then we could all expect them to do what they are asking us to do. Pay back the salary that we as taxpayers pay to them. Better yet, we should extract a punitive tax (99% would be about right). Or maybe let them serve for $1 this next year. Or at least until they figure this mess out, and fix it. How would the Hon. Senators and Representatives feel about this standard being applied to them? That seems like the right, fair, and honorable thing to do.
What if I had worked for 10-15 hours a day, for free essentially ($1) based on the idea that I would receive a payday at the end of the year.
All the more reason for AIG to have renegotiated their contracts rather than lie to the press, stonewall the Congressional inquiries about the bonuses, and hide behind legal CYAs at the last minute.
I don't expect anyone to work for $1. AIG should have given the workers a reasonable salary and no bonuses.
They didn't lie to the press, they said there wouldn't be any performance bonuses. Retention bonuses really aren't bonuses, they're deferred compensation.
As for people saying their salaries are unsustainable, sustainability has to do directly with the per capita amount of profit you make. The higher that profit, the higher salaries that are sustainable. Even had the AIG execs been working for a dollar a year in the years leading up to this mess, it would have had little to no impact monetarily on the collapse. The same cannot be said of the UAW workers.
They didn't lie to the press, they said there wouldn't be any performance bonuses. Retention bonuses really aren't bonuses, they're deferred compensation.
Dec 11 2008
Nicholas Ashooh, AIG's senior vice president of communication, .. said the retention program does not include anyone in the firm's financial products business
The Auto workers and their union are destroying teh auto companies. They are doing that because unions are inherently evil institutions: anti-individual, anti-merit, anti-productivity. Their demands for higher pay for less work, their opposition to increased productivity and embrace of featherbedding, is what's destroying their employers. Eliminate all teh work rules, and you'll have a start on saving GM.
DeSantis, OTOH, was working to save AIG, or at least to cut down on taxpayer losses. He was being attacked not because of anything he had done, but because sleazy Democrat Politicians (pardon the redundancy), having passed, unread, the Pelosi/Reid/Obama "stimulus" bill that was generating populist anger, needed some scapegoats that they could attack.
So, are you falling for that game because you're so unsophisticated you can't figure out what's going on? Or are you just a dishonest partisan hack, pushing the left wing line without thought, or any concern for reality?
Your team decided that a massive economic crisis was a great time to push a massive spending bill that had everything to do with advancing your political desires, and nothing to do with fixing the economic problems. Oops, voters are noticing. Now you guys are going to get screwed for screwign teh American people.
you deserve it.
DeSantis, OTOH, was working to save AIG, or at least to cut down on taxpayer losses.
DeSantis was employed at AIG for eleven years. He was an executive vice president in charge of the development of business commodities in the very same division that nearly brought the global economy to the brink of financial collapse.
I was not aware that the problem was that systemic or chronic. Perhaps you can explain to my how someone who received massive bonuses in the past can straight-facedly claim he was somehow screwed? I know Tom Mac is incapable of doing anything but call names and spew fumes.
DeSantis, OTOH, was working to save AIG, or at least to cut down on taxpayer losses.
DeSantis saving AIG - thanks for the laugh.
The difference between the auto workers and the financial workers is that the sense of entitlement of the latter is an order of magnitude bigger.
It's striking to me that the very same people who are outraged by DeSantis's treatment showed no sympathy at all for the nation's autoworkers.
"AIG got a better deal than Detroit and the UAW!"
Puhleeese, give this a canard a break, it's wings are falling off from exhaustion.
The "sympathetic" deal that AIG got from the feds is that it's going to be broken up into parts and be sold off to whomever will buy them to repay what the govt put into it as best as is possible.
If Detroit and the UAW want this same deal -- break up GM and sell off its parts (with or without employees) to Toyota, Nissan, Honda, Huyndai, Bulgarian Motor Works or whomever -- just say so and we can end this whole controversy real quickly!
But even if you do, the govt is going to have pay key GM execs 6- and 7-figure compensation -- tied to performance (say "bonuses") and backloaded to make sure the execs don't jump ship at a critical moment (say "retention bonus")-- to work to maximize the value the taxpayers get from selling off the parts.
Is that really difficult for the left to understand?
The "bonus tax" is just plain stupid all the way across the board.
I'm driven to wonder what should be most disturbing about it -- that through it Congress tries to violate every basic principle of sound legislation and legislative responsibilty that it can in as small a legislative package as possible...
“Bills of attainder, ex-post-facto laws, and laws impairing the obligation of contracts, are contrary to the first principles of the social compact, and to every principle of sound legislation.” — James Madison, in Federalist #44, hitting it right on the head (as the Dems go three-for-three on this one!)
... or the plain fact that in totally pragmatic terms it is just so self-defeatingly stupid.
BTW, the reason the UAW workers have to cut their compensation is because it is impossible for their employers to stay in business while paying far higher costs than the competition. (Unless liberals have a way around that?)
And do they really deserve "sympathy" for keeping their own wages so far above the market rate for so long that they've hollowed out, destroyed, their own industry (while non-UAW auto makers in the US are doing fine) while reducing Detroit to a slumtown where the average price of a home now is all of $13,000?
The UAW deserves sympathy for that?
If Detroit and the UAW want this same deal -- break up GM and sell off its parts (with or without employees) to Toyota, Nissan, Honda, Huyndai, Bulgarian Motor Works or whomever -- just say so and we can end this whole controversy real quickly!
You are forgetting a fundamental difference. GM did not pose a mortal threat to the economy of this country. AIG did.
I would actually love it if AIG or Citi or [insert other financial institutions] could be broken up along with their "toxic assets" and dumped to someone else, without a taxpayer bailout. Unlike the autos who would find a buyer, you'd have no market for these toxic financial institutions.
And you even forget that Chrysler was owned by Diamler Benz.
But even if you do, the govt is going to have pay key GM execs 6- and 7-figure compensation -- tied to performance (say "bonuses") and backloaded to make sure the execs don't jump ship at a critical moment (say "retention bonus")-- to work to maximize the value the taxpayers get from selling off the parts.
Um, no it is not going to have to pay 7 figure compensation to the execs. Much to the chagrin of Rush Limbaugh types.
The "bonus tax" is just plain stupid all the way across the board.
Not so according to a majority of the US taxpayers.
I'm driven to wonder what should be most disturbing about it -- that through it Congress tries to violate every basic principle of sound legislation and legislative responsibilty that it can in as small a legislative package as possible...
The argument from the Republicans about retroactivity is laughable as they were the ones who voted unanimously for retroactively denying Americans the right to sue telcos who violated their rights.
Had AIG been upfront about these bonuses, Congress could have passed a law last year. Instead AIG lied to the press and stonewalled Congress. See link for details.
The point is, the company SHOULD HAVE FAILED. He shouldn't have gotten anything, and us taxpayers (including those autoworkers) shouldn't have payed a penny for the stupid company.
So should GM and Chrysler because of the idiotic UAW and their demands.
Here's what I got out of this: "It looks like the guy got screwed, but that's A OK because he can take it and other people get screwed too!" Your blog is more revealing than the "outpouring of conservative sympathy and outrage."
It really appears that elected officials used the guy as a scapegoat to make themselves look better. Or they simply are inept and don't understand what they are doing. Or both.
For those who missed A.L.'s point that people on the right seem to think what happened to DeSantis is somehow more compelling than what happened to the UAW, your answer has been delivered by Matt Taibbi at Alternet here.
For those who missed A.L.'s point that people on the right seem to think what happened to DeSantis is somehow more compelling than what happened to the UAW, your answer has been delivered by Matt Taibbi at Alternet here.
That is a f***ing masterpiece. Thanks for the link.
unfourtantly there are many people both libreal and conservative who feel blue collar jobs pay too well i work as a construction laborer in baltimore for
$10 to $12 an hour and ive found that most of my libral friends think all construction guys make $100,000 a year . they feel that to make over $30,000 a year without a college education is unfair since they had to go to college.personnaly i never cared about how much anyone at aig made until my tax dollars paid their salaries. unfourtantly neither greed or envy belong to either librals or conservatives pete from baltimore
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