23 March 2009

AIG Executives Giving Back Bonuses

The US government paid AIG about $170 billion in bailout money so far this year. Then AIG turned around and doled out $165 million in bonuses and retention bribes. Some of the money even went to former employees.

To say this outraged the public and it's customers is an understatement. Mediums saw angry mobs with pitchforks and torches in their crystal balls.

So far 15 AIG executives have agreed to return their bonuses which comes out to about $30 million. A few lower ranking employees have also agreed to return their bonuses, another $20 million. Employees have been asked to return their bonuses. Some have, some are still thinking about it and some refuse to do so. There have been some high level resignations.

Bonus information is being collected by Governor Rell, hoping to invalidate them under the Connecticut Unfair Trade Practices Act. Go, Rell, go!

The House of Representatives tried to put a 90% tax on bonuses of the higher-earning employees just at AIG but the President said it was unconstitutional. Now the Senate is thinking of something similar to pass.

If you look at how much money AIG lost, this bonus amount is tiny in comparison and not the cause of their financial problems. It's the higher up muckie-mucks pilfering the vast coffers of their employer. However, companies should never hand out bonuses unless the company does well. AIG is not doing well and should not be paying anyone bonuses.

Besides, I think bonuses should be handed out from the bottom levels up - where the money is truly needed and matters.

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