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AIG - and if bonuses aren't enough ....

post #1 of 15
3/21/09 at 9:47am
Thread Starter 
.... now we learn that AIG is suing the government for a tax refund.

http://www.nytimes.com/2009/03/20/bu.../20aig.html?hp

AIG may be due a tax refund on its foreign taxes paid under the IRS code; it's legal and some might argue good business to get what you've got coming; BUT -- given the circumstances, the way they're going about it is a perfect public relations disaster, not to mention ethically and morally questionable. This is just another example of arrogance and incompetence; just another example of "they don't get it." Why couldn't they strike a deal that's both publicly acceptable and good business practice? Would it be all that difficult for them to say: OK, give us the tax refund we have coming under the tax code and we'll turn right around and pay all that money directly back as a payment on our TARP loans.
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post #2 of 15
3/21/09 at 10:53am
I just have three words:

LET THEM FAIL!
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post #3 of 15
3/21/09 at 11:16am
Thread Starter 
I don't think that's an option any more. Should have been done at the beginning. Now we've got how many billions of taxpayer dollars stuck in there? I think we've got to keep them going long enough to clean the "toxic assets" out of the portfolio, then split up the company, selling off the best parts and liquidating the rest, with the proceeds going to the US Treasury. Anything left after the loans are paid back (if any) can go to the other creditors and the shareholders.
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post #4 of 15
3/21/09 at 1:30pm
Quote:
Originally Posted by coaster View Post
I don't think that's an option any more. Should have been done at the beginning. Now we've got how many billions of taxpayer dollars stuck in there? I think we've got to keep them going long enough to clean the "toxic assets" out of the portfolio, then split up the company, selling off the best parts and liquidating the rest, with the proceeds going to the US Treasury. Anything left after the loans are paid back (if any) can go to the other creditors and the shareholders.
That sounds like a good plan to me, but of course they won't do it.
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post #5 of 15
3/21/09 at 2:41pm
Was walking thru the front room to let out a cat when I heard something on the TV about the AIG executives on a cable news program. All I caught was that the executives were now hiring bodyguards and were told to stay in their houses and if they did go out, to go out only in very public places!

I was curious so I went to Ask.com and here's part of what was said:

In testimony before Congress the current head of AIG, Edward Liddy, testified today that several death threats have been made against some of those individuals that received the obscene bonus payments by way of yet another bailout of the criminals that caused this mess in the first place.

Mr. Liddy read aloud one of the death threats that the people receiving the money had already received, and implied that this was not the only one.
"All the executives and their families should be executed with piano wire around their necks!"

Liddy was asked by Rep. Barney Frank to release the names of those individuals that received the money. The CEO of AIG refused to give the names of the individuals unless he could be assured that their names would be kept "confidential." This was an astounding claim to make; since AIG, the Federal Reserve and the government have been arguing all along how brilliant and indispensable these individuals are, not to mention "how absolutely critical their services are to resolving this crisis, going forward" If that were true why would those "brilliant and indispensible people" not want the whole world to know exactly who they are?

Awwww, how sad that dose vewy, vewy wich mens gots so vewy, vewy scairdy?

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post #6 of 15
3/21/09 at 3:03pm
Quote:
Originally Posted by PookieBoy View Post
Was walking thru the front room to let out a cat



Sorry, off topic.
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post #7 of 15
3/21/09 at 3:17pm
Quote:
Originally Posted by PookieBoy View Post
Awwww, how sad that dose vewy, vewy wich mens gots so vewy, vewy scairdy?
They may be scared for their lives (yeah sure) but I'd rather see them scared over losing the roof over their heads, not being able to afford healthcare, and how they are going to pay for simple things like decent groceries and putting gas in their cars.

Not only are they incompetent, recalcitrant, and clueless, they are also cowards. If they had any self respect they would come forward and apologize, not hide in their mansions like so many cockroaches afraid of the light of day.
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post #8 of 15
3/21/09 at 7:41pm
Thread Starter 
Quote:
Originally Posted by 2dogmom View Post
Not only are they incompetent, recalcitrant, and clueless, they are also cowards. If they had any self respect they would come forward and apologize, not hide in their mansions like so many cockroaches afraid of the light of day.
I think I mentioned this in another thread about AIG, but in this climate it bears repeating. Liddy was not at the company when all this happened. He came out of retirement at the request of the government to run the company for them. I watched most of his testimony and he impressed me as a forthright individual doiing the best he can with a very bad situation. It needs to be remembered that he's only getting paid $1 a year for doing this and being the target of a lot of public abuse. I think he was well advised to not turn over the names of those employees that got the bonuses. He's got a huge job there to rescue as much value as he can to pay the government back for their bailout. If he gives out the names then the rest of the employees aren't going to trust him or respect him. He's got certain obligations toward his employees and his company, and those obligations are in the best interest of the U.S. taxpayers. A lot of this public anger is being misdirected by those who want to deflect it away from their own culpability in it.
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post #9 of 15
3/21/09 at 7:45pm
Regardless of how bad the decision was by the company, the employees themselves shouldn't be threatened with bodily harm and fear for their lives. This is America. They didn't break the law, and frankly they didn't make the decision to give them the bonus. What the general public doesn't know is which executives have voluntarily given back 50% or more of those bonuses.
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post #10 of 15
3/21/09 at 10:02pm
Thread Starter 
Liddy said that one of them volunteered to give it all back.
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post #11 of 15
3/22/09 at 1:56am
Quote:
Originally Posted by 2dogmom
Not only are they incompetent, recalcitrant, and clueless, they are also cowards. If they had any self respect they would come forward and apologize, not hide in their mansions like so many cockroaches afraid of the light of day.
The above pretty much sums up Congress, too.
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post #12 of 15
3/22/09 at 2:14am
I just have a question. Are rank-and-file employees actually being threatened, or are the executives merely saying that so that AIG (our money) would pay for the additional security at their homes instead of the execs having to pay their own bodyguards?
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post #13 of 15
3/22/09 at 4:31am
This is all very "French Revolution"!
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post #14 of 15
3/22/09 at 5:51am
I'm not pointing the finger at Liddy by any means. Obviously this was going on well before he was called in, which is what really makes me angry. These people were getting paid huge amounts of money and for what? Were they doing their jobs that well? If so then something needs to be changed so that rapacious trading practices are not rewarded. If they were not doing their jobs well and got the huge salaries and bonuses anyway, then the company can rot for all I care. This all only came out because they are now under public scrutiny. It makes me wonder what else is going on on Wall St.
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post #15 of 15
3/22/09 at 12:24pm
Thread Starter 
Quote:
Originally Posted by 2dogmom View Post
If so then something needs to be changed so that rapacious trading practices are not rewarded.
The root cause of this is greed. Greed for high returns motivates financial firms to make big contributions to lawmakers so they can get what they want. Greed for power makes the lawmakers want to get reelected and so they take the money. In return for the money to get reelcted they pass the laws the financial firms want. Then because the law says they can do it, the greed of the financial firms motivates them to create new products whose risk is unknown, and because of their greed they don't really want to know. Greed on the part of the investors motivates them to invest in these unregulated and risky securities.

What's the solution? Well, we can't take away greed -- that's human nature. We can take away one link in the chain, and break it so that it doesn't happen again. Because if we don't, it will happen again with something else. Which link in the chain? Obvious to me is that it's the lawmakers. If they didn't deregulate the securities markets, none of this would have happened. How to break it? Take away the need for money to get reelected. Campaign finance reform? Not good enough. Been tried and there's always some way around it.

TAKE AWAY THE NEED TO GET REELECTED.

EVERYBODY SERVES ONE TERM AND ONE TERM ONLY.

That will solve the problem.
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