Video: Obama outrageously outraged by AIG outrage; Update: Treasury to reduce AIG’s bailout funds?

posted at 3:20 pm on March 16, 2009 by Allahpundit

In which The One attempts to douse a populist brushfire with a little heat of his own. Two issues here: Can the feds legally force AIG to break their contracts with their traders and deny the bonuses, and if so, should they? Ambinder advises ignoring the first question and focusing on the second. How likely is it, he wonders, that AIG’s traders would sue to recover them given the Madoff-ian public opporobrium they’d receive for doing so? Pretty likely, counters Tom Maguire, who agrees that the second question is the more important — and likely to cause further headaches if the bonuses are denied:

First of all, as I wasted my breath explaining, AIG [Financial Products division] is active in many businesses, not all of which are focused on credfit derivatives. Secondly, Joe Cassano, who led the unit until he was pushed out in March 2008, had enemies inside and ouside AIG FP, some of whom may have agreed to emerge from internal exile and attempt to clean up after him. Thirdly, insurance companies which don’t honor their contracts don’t last long; it is possible that failure to honor this obligation would represent the sort of default whch would ordinarily trigger a bankruptcy or reorganization, which so far the Feds have labored mightily to avoid. Fourth, if the new concept of selective default is that AIG won’t pay people or firms the public doesn’t like, how confident will, for example, Goldman Sachs be that AIG will honor its obligations to them? (Ok, why are we honoring the AIG obligations to Goldman – surely the Goldman execs could take it out of their bonus pool, yes? Instead, my tax dollars went to AIG, from there to Goldman, and from there to some trader’s estate in the Hamptons. Troubling, I would think.)

And FWIW, as the letters to Geithner explained, AIG wil have to pay double bonuses after they lose this suit, which they will.

What about a one-time tax on bonuses paid to employees of TARP recipients? That would sidestep the legal issue of breach of contract, although you’d still have the problem of scaring away talented managers from troubled firms. Then again, you’ve got that problem anyway: The more public anger grows, the likelier it is that people who work for TARP companies will be targeted in the future. While you mull a solution, enjoy the sublime irony in the second clip below of one of the chief culprits in the subprime implosion railing about profiting from incompetence.

Update: Forgot the link to Bill Kristol’s piece in WaPo today begging the GOP to figure out that two can play at the populist game before Obama claims it for himself.

Can capitalism survive the behavior of some capitalists? It’s always been an open question. But if capitalism is to survive, shouldn’t the Republican party, the party that defends democratic capitalism, be particularly vehement in denouncing its excesses? Isn’t this a pretty spectacular one? And isn’t this a moment for the GOP to separate itself from the Bush administration as well as the Obama administration, who together have been responsible for an incompetent and improvident bailout? Figuring out the right policy going forward with respect to toxic assets and the rest is, of course, a major intellectual task. But being on the side of a healthy populist reaction to the AIG situation is at least a good political start.



Update: More good news from Geraghty: Not only have the checks already gone out, but many of the recipients aren’t even U.S. citizens. Ambinder claims Treasury is scrambling to punish the firm somehow, possibly by knocking the cost of the bonuses off of their bailout package. How does that make sense, though? If the point of the funds is to keep the company afloat, reducing the package only reduces the likelihood of that while not taking the money out of the traders’ pockets. Which I guess explains this:

Speaking of punishing AIG: Rep. Gary Peters (D-MI) plans to introduce a bill to tax AIG bonuses at a high rate this year. A spokesman for Peters says that details are still being worked out. Targeting legislation at one company is tantamount to the Congress’s passing a bill of attainder against AIG. But these are extraordinary times.


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WisCon on March 16, 2009 at 4:59 PM

They aren’t my agents you moron. But go ahead and keep on promoting corporate welfare

If you are an American citizen, then they are your agents, numbnutz. Whom you voted for and against is irrelevant. These bozo’s are what you have. See “Agent” [ref. The Dictionary]

I am promoting the Rule of Law, not corporate welfare. The people who agreed to TARP without oversight are the ones against whom the corporate welfare allegation might stand.

Troll Feeder on March 16, 2009 at 5:55 PM

Obama is a big smoker. He’s developed a smoker’s cough.

marklmail on March 16, 2009 at 6:00 PM

I think you have to look at the Executives at AIG as the leaders of a failed enterprise. Failed enterprises as large as AIG certainly will have some divisions or units that were profitable but the company failed and everyone goes down with the ship. Free enterprise says it goes to bankruptcy and they reorganize and lawfully do the best with their assets as possible and start again if they can.
Okay so bailout lets the incompetents to go free and they actually get bonuses for leading themselves and fellow workers into bankruptcy. Tell me again why this is good and how it helps rescues the economy. Did you ever work for a company that told you if you fail and bankrupt us we are going to pay you your bonuses anyway bonuses are not predicated on success you just are entitled to them as part of being employed here. Any boss I ever had would have told me to walk period if I proposed such a thing. I see nothing populist in the idea that incompetents and failures accept the results of free markets and free enterprise. Hang um high.

rsl775 on March 16, 2009 at 6:17 PM

When you see how Mr. Supergenius Obama manages the economy, it makes ya wonder how he would manage a war. We’ve elected an idiot savant, brilliant at making speeches but a dolt at doing anything else.

Tantor on March 16, 2009 at 6:17 PM

Wow, this just keeps getting deeper and deeper. I don’t think the bonuses are such a big deal. The traders probably don’t make huge salaries just depend on the bonuses. Obviously they earned them if they are eligible. Shame on Congress for not putting restrictions on how bailout money is spent.

ctmom on March 16, 2009 at 6:18 PM

Ex-post-facto law is alive and well in the Obama White House.

unclesmrgol on March 16, 2009 at 6:25 PM

Ex-post-facto law is alive and well in the Obama White House.

unclesmrgol on March 16, 2009 at 6:25 PM

I am the state, I am the law…..

-Hitler
Stalin
Pol Pot
Mugabe
B-O’Bama

sven10077 on March 16, 2009 at 6:30 PM

Lesson: this is what we get for having so many nitwits in Congress who have zero business sense authorizing spending of extraordinary amounts without any strings attached. This is like handing to $1,000 to an eight-year-old at Disney World and telling him that you’ll see him at the end of the day.

Since the federal government owns 80% of the company, the feds should demand to see the bases for these bonuses. I have a hard time understanding how employees of a company that has done so poorly recently warrant any bonuses whatsoever. Also, Geithner should demand the names and Social Security numbers of the bonus recipients and then flag their 2008 and 2009 U.S. income tax returns for IRS audits that are the functional equivalent of a rectal exam–with no lubricant.

BuckeyeSam on March 16, 2009 at 6:31 PM

Well, the attack on Rush backfired so now it’s back to Obama’s favorite pasttime, bashing Wall Street. Have to distract people from criticizing the administration somehow. These guys are so bleedin’ obvious.

evergreen on March 16, 2009 at 6:32 PM

Read the Constitution you idiot. Seriously…

RedSoxNation on March 16, 2009 at 6:32 PM

Can the feds legally force AIG to break their contracts with their traders and deny the bonuses, and if so, should they? How likely is it, he wonders, that AIG’s traders would sue to recover them given the Madoff-ian public opporobrium they’d receive for doing so?

Answers:

If the feds wanted AIG to break their contracts they should have let the company that was “to big to fail” go into bankruptcy. Even as the largest shareholder, the US doesn’t have the right to ignore obligations the company made P.F.L. (pre filthy liar).

Those who are getting these bonuses should pursue legal recourse for breach of contract. I have an in-law in a related industry and the bonus is a big part of the annual income. It is unfair for the filthy liar to come in and deny people who work for a living what they were promised. We were promised a bipartisan leader who was going to change to tone in DC and look at the rotten deal we got!

highhopes on March 16, 2009 at 6:33 PM

Well, the attack on Rush backfired so now it’s back to Obama’s favorite pasttime, bashing Wall Street. Have to distract people from criticizing the administration somehow. These guys are so bleedin’ obvious.

evergreen on March 16, 2009 at 6:32 PM

And everytime the filthy liar attacks Wall Street the market reacts by going to the negative.

highhopes on March 16, 2009 at 6:34 PM

I’m totally bored with this “scandal”. Whether they got bonuses or not, means NOTHING. It’s the liberal, Democratic politics of envy at work here, nothing else.

Paul-Cincy on March 16, 2009 at 6:35 PM

Did Eliot Spitzer destroy AIG?

Pole-Cat on March 16, 2009 at 6:38 PM

Which part of this story is news?

Some people were outraged months ago.

drjohn on March 16, 2009 at 6:38 PM

Obama was so authentically outraged he used his trusty Teleprompter. The cables kept a tight shot on his face while he spoke but it was clear he was using it from his cadence and head motion and so I waited until the end when the camera focus backs up to capture the usual end-of-event handshaking and then I got a couple screencaps of IT.

KittyLowrey on March 16, 2009 at 6:39 PM

This scandel is an appeal to get attention. Mark to market is what stands behind these “write downs” of reserves. If it is a problem they can change the laws. Pork is the actual money down the toilet.

seven on March 16, 2009 at 6:40 PM

Gosh, how would Obama and Barney Frank like to have their pay cut based on how well the citizens believe they do their jobs?

Oink on March 16, 2009 at 3:24 PM

Bawny Fwank should be made to disgowge the Congwessional pay waise until such time as the economy has tuwned awound and we have a balanced budget!!!

landlines on March 16, 2009 at 6:40 PM

Wow, after reading many other blogs, they are outraged with AIG while this one is not.

And you wonder why you are losing elections.

AIG is the victim here?

Seriously?

Well, I can’t argue against failed ideology.

Wow.

getalife on March 16, 2009 at 6:47 PM

Wow.

getalife on March 16, 2009 at 6:47 PM

you need to do your job and make sure Bush doesn’t sneak back into the WH and push the red recession button again….

no go get your shinebox.

sven10077 on March 16, 2009 at 6:48 PM

Update: More good news from Geraghty: Not only have the checks already gone out, but many of the recipients aren’t even U.S. citizens.

Massive amounts of public funds going to cover foreigners’ expenses. I see how the Democratic Party would be outraged.

radiofreevillage on March 16, 2009 at 6:49 PM

I read over Instapundit that 68% of the money AIG contributed in the last campaign went to Democrats.

So whatever Kristol might think it seems that the Wall Street people know it is the Democrats who are most likely to come up with the really big packages.

I think that most people would accept some money going to support the financial system, but they want to know the money will be repaid and that is actually necessary. This sort of behavior undercuts that notion.

Terrye on March 16, 2009 at 6:53 PM

radiofreevillage on March 16, 2009 at 6:49 PM

And you are not outraged?

getalife on March 16, 2009 at 6:57 PM

I guess the lesson is when you have incompetents and/or crooks running the government and incompetents and/or crooks running private enterprise then you are going to get a lot of unintended consequences and everybody loses situations. I sure know who I am not voting for and have that choice but I have no control over who gets hired in private enterprise. I have to depend on Boards of Directors and inputs into Annual meetings and my 100 shares don’t have much clout or in the case of AIG 5200 shares. So of makes me feel like Madoff was in charge and I never saw it coming it was all covered up and all the oversights of private enterprise were sleeping or bought off. Yea gives these guys their bonuses they sure fooled me just the way the invisible hand works, buyer beware and no crying in baseball.

rsl775 on March 16, 2009 at 6:58 PM

Funny these fools didn’t look so outraged I guess reading off a teleprompter doesn’t allow for show of emotion.
This selective outrage only serves to distract from President Pinnochio’s disasterous first 53 days and failed administration policies.

The real outrage they feel is that the American people are fed up, the American people see the fools bailouts are not working, the American people are beginning to see the fools have no idea what they are doing and are a bunch of incompetent buffoons and crooks.
This puts in jeopardy their next trillion dollar wealth transfer from the people who earned it and to the politicians who are spreading the wealth (as Joe The Plumber made President Pinnochio to fess up to) and simultaneously destroying it.

The Tea Parties are beginning and need to turn into real outrage at the feckless Congress, Senate and Mr.Pinnochio Present!
That is what they fear and are really outraged at as Urkels numbers tank.

dhunter on March 16, 2009 at 7:07 PM

I think that most people would accept some money going to support the financial system, but they want to know the money will be repaid and that is actually necessary.

What sort of behavior? They are trying to turn multi-billion dollar losses into profit. They charge fractions of a percent for this job. How is this not a good deal?

If there was a company who needed your expertise to stay afloat, would you work for half of your usual compensation or less?

radiofreevillage on March 16, 2009 at 7:11 PM

Barney Franks comments sounded like the biggest dork I’ve ever hear. duh..should be in detention is this were high school. gawd. yeah Make marijuana legal and they’ll all sound like him. can’t f’n wait.

johnnyU on March 16, 2009 at 7:15 PM

SPARE ME THE OUTRAGE. That´s what inevitably happens when you get into the bailout business. Remember: when these contracts were made, your money wasn´t at stake. Bonuses? Well, that´s how these people are paid. The administration forgot about it, but that´s big government for you. Now if the company were bankrupt… but we don´t want that either.

That is not capitalism. The people wanted corporatist socialism. They got it. Stop your whining and swallow, you fools.

el gordo on March 16, 2009 at 7:18 PM

That is not capitalism. The people wanted corporatist socialism. They got it. Stop your whining and swallow, you fools.

el gordo on March 16, 2009 at 7:18 PM

we are not in a free market we are in a freeloader’s market…

sven10077 on March 16, 2009 at 7:20 PM

It strikes me that this episode illustrates the inherent evils of a bailout. There really are no rules; the government pumped many billions into AIG, but the company and its new “owners,” the taxpayers, are making it up as they go along. AIG is likely right in saying it is obligated to pay the bonuses, but the public is also right in believing a bailout shouldn’t work this way. The problem is that we have no established rules to govern bailouts.

Which is one basic reason why bankruptcy is far preferable. Bankruptcy has reasonably clear rules that have been developed over many years. The bankrupt company is run for the benefit of its creditors, or, if appropriate, shut down. The creditors decide whether to keep existing management on. Executory contracts can be accepted or rejected; labor and supply agreements can be renegotiated. A judge presides so that disputes can be fairly resolved.

A bailout is an ill-defined procedure in which no one’s rights are clear, and political calculation counts for more than fairness or transparency. The flap over AIG bonuses is just one of many that we can expect to arise if we continue down the path of endless bailouts, rather than allowing insolvent companies and their creditors and investors to pay the price of that insolvency.

From Powerline.

Wethal on March 16, 2009 at 7:21 PM

it is possible that failure to honor this obligation would represent the sort of default whch would ordinarily trigger a bankruptcy or reorganization

So I say – let’s go! Cancel the bonuses and let AIG end up where it belongs, bankruptcy court and then the Officers of AIG can head over to criminal court with Maxine and Barney.

katablog.com on March 16, 2009 at 7:25 PM

“Never let a crisis go to waste.”

So now The One wants more authority to regulate business, since government screwed it up so badly the first time.

Frightening.

PattyJ on March 16, 2009 at 7:28 PM

A bailout is an ill-defined procedure in which no one’s rights are clear, and political calculation counts for more than fairness or transparency. The flap over AIG bonuses is just one of many that we can expect to arise if we continue down the path of endless bailouts, rather than allowing insolvent companies and their creditors and investors to pay the price of that insolvency.

Which is probably the exact government definition of “too big to fail”. The US Government created this mess. Taxpayers screamed and yelled and melted down phones and email boxes begging this bailout not to happen. O’s now just doing a bait and switch to try to keep his ratings from hitting an all time low for a President in just 3 months (give it another month, he’ll be there).

Yo O – we ain’t as stupid as you think!

katablog.com on March 16, 2009 at 7:28 PM

Get the bonus money from Franklin Raines and the other Fannie Mae execs??????

RealDemocrat on March 16, 2009 at 7:28 PM

Want to know what makes Jack Welch great? Go to CNBC and find the video of his appearance just now on Kudlow and listen to what he says about AIG and the government. What he does here is what all truly great leaders do. He identifies the key issue, frames the logical way of thinking of it and provides a real solution.

TheBigOldDog on March 16, 2009 at 7:34 PM

getalife on March 16, 2009 at 6:47 PM

Then do us a favor and remain at all those other “way smarter” blogs you like to brag about.

anniekc on March 16, 2009 at 7:35 PM

To paraphrase Welch:

The American Government owns 80% of AIG and they aren’t acting like owners. They aren’t acting like the Board of Directors that they are. They are acting like outside critics throwing stones at the business they own as if they don’t care about ever getting their money back, never mind seeing a profit. The CEO is THEIR CEO. They put him there. He’s making $1 a year and doing the job as a good citizen. Instead of throwing rocks they need to be working with THEIR CEO and running THEIR business to resolve any issues.

TheBigOldDog on March 16, 2009 at 7:41 PM

Massive amounts of public funds going to cover foreigners’ expenses. I see how the Democratic Party would be outraged.

radiofreevillage on March 16, 2009 at 6:49 PM

Phony populist outrage for the polls. The Democrats have no reason to be outraged. They signed off on the no-strings-attached, no-oversight giveaway. It was knuckle-dragging Neanderthals like us conservatives who were against it.

ddrintn on March 16, 2009 at 7:46 PM

Get the bonus money from Franklin Raines and the other Fannie Mae execs??????
RealDemocrat on March 16, 2009 at 7:28 PM

Brilliant. Unfortunately, rewarding failure is policy now. In the name of justice or something (probably the latter).

el gordo on March 16, 2009 at 7:46 PM

Wow.

getalife on March 16, 2009 at 6:47 PM

Many other blogs think you should be allowed to marry your pets.

Ronnie on March 16, 2009 at 7:47 PM

Phony populist outrage for the polls. The Democrats have no reason to be outraged. They signed off on the no-strings-attached, no-oversight giveaway. It was knuckle-dragging Neanderthals like us conservatives who were against it.

ddrintn on March 16, 2009 at 7:46 PM

The Government owns AIG. 80% of it in fact. They have an obligation to act like owners. To act like a Board of Directors. They appointed the CEO. The problem isn’t attaching strings, it’s the Government’s inability to take accept their obligation as owners. This is why Government ownership of business is a disaster.

TheBigOldDog on March 16, 2009 at 7:53 PM

Can the feds legally force AIG to break their contracts with their traders and deny the bonuses, and if so, should they?

Not according to that Constitution thingy.

Rae on March 16, 2009 at 7:53 PM

TheBigOldDog on March 16, 2009 at 7:41 PM

They are a bunch of government hacks with a smattering of academics – they haven´t run anything like a business in their lives. The are firmly ensconced in the ivory tower from which their wisdom trickles down. We might call it … the NEW trickle down economics.

Obama couldn´t run a hot dog stand without hiring three former senators, six speechwriters and four liberal law professors and their wives. He would require eight billionaire fundraisers and twenty thousand foreign donors. And then he would need a vacation.

el gordo on March 16, 2009 at 7:56 PM

Zero is nothing but a slick talking con man. A three card monte dealer in DC.

This is just empty grandstanding to try and stop the bleeding in his plummeting poll numbers.

Why is it that Zero talks to our enemies with such humility and respect – yet our own businesses are constant targets of his policies and criticisms?

Mr Purple on March 16, 2009 at 7:58 PM

Obama is a big smoker. He’s developed a smoker’s cough.

marklmail on March 16, 2009 at 6:00 PM

He’s so incompetent and so far in over his head that he probably sucks down 4 or 5 packs a day.

rplat on March 16, 2009 at 7:59 PM

Speaking of punishing AIG: Rep. Gary Peters (D-MI) plans to introduce a bill to tax AIG bonuses at a high rate this year.

It takes a lot of ba1ls for a guy from Michigan to propose that we tax the AIG guys at a higher rate, but not the UAW workers at GM and Chrysler. Aren’t they only employed because of their bailout, too?

Y-not on March 16, 2009 at 8:06 PM

el gordo on March 16, 2009 at 7:56 PM

And that’s why the path we are on is a total disaster…

TheBigOldDog on March 16, 2009 at 8:13 PM

To paraphrase Welch:
The American Government owns 80% of AIG and they aren’t acting like owners. They aren’t acting like the Board of Directors that they are. They are acting like outside critics throwing stones at the business they own as if they don’t care about ever getting their money back, never mind seeing a profit. The CEO is THEIR CEO. They put him there. He’s making $1 a year and doing the job as a good citizen. Instead of throwing rocks they need to be working with THEIR CEO and running THEIR business to resolve any issues.
TheBigOldDog on March 16, 2009 at 7:41 PM

More grandstanding by President TelePrompter. He voted to give AIG the bailouts – with no strings attached - and he yells about bonuses.

It’s like He and Barney Frank voted to loan/invest billions in a restaurant, then scream “rat” every five minutes. How can you expect AIG to conduct business? First they condemned the AIG exes for jet expenses and parties, while Obama himself threw lavish parties (150 million on inauguration)& jetted around the country.

TN Mom on March 16, 2009 at 8:27 PM

Many other blogs think you should be allowed to marry your pets.

Ronnie on March 16, 2009 at 7:47 PM

Animal husbandry?

Seriously, even the gop are smart enough to jump on this populist outrage.

It’s good politics.

getalife on March 16, 2009 at 8:29 PM

TN Mom on March 16, 2009 at 8:27 PM

We have to stop thinking of it as a “bailout” and start thinking of it what it was, a purchase. The US Government bought AIG. They own it, lock, stock and barrel.

TheBigOldDog on March 16, 2009 at 8:29 PM

Oh sure President TelePrompter yells at AIG for paying their employees bonuses..

What about the UNION bonuses in the stimulus bill for construction jobs? Only UNION construction workers/firms are allowed to work on stimulus jobs; UNION workers which will costs much more (of course) per hour/job than non-union workers.

oh, and, what business experience has Obama or Barney Frank ever had??

TN Mom on March 16, 2009 at 8:33 PM

We have to stop thinking of it as a “bailout” and start thinking of it what it was, a purchase. The US Government bought AIG. They own it, lock, stock and barrel.

TheBigOldDog on March 16, 2009 at 8:29 PM

The CEO (President TelePrompter) and board of directors (Dem Congress) is doing a lousy job running AIG.

Let’s fire them!!!

TN Mom on March 16, 2009 at 8:35 PM

Outraged? Outraged? BO here is some OUTRAGE. Take want our warriors to bare financial responsibilities for wounds while serving this country. You want take money back from AIG, who is trying to live up to prior commitments. But you and you gang of thieves OKed raises for Congress. I AM OUTRAGED, by your actions.

Wade on March 16, 2009 at 8:35 PM

The CEO (President TelePrompter) and board of directors (Dem Congress) is doing a lousy job running AIG.

Let’s fire them!!!

TN Mom on March 16, 2009 at 8:35 PM

And that’s exactly the strategy the Right should be pursuing right now.

TheBigOldDog on March 16, 2009 at 8:38 PM

The Government owns AIG. 80% of it in fact. They have an obligation to act like owners. To act like a Board of Directors. They appointed the CEO. The problem isn’t attaching strings, it’s the Government’s inability to take accept their obligation as owners. This is why Government ownership of business is a disaster.

TheBigOldDog on March 16, 2009 at 7:53 PM

It’s convenient in an “ex post facto” way for Obama, Frank et al to vent their righteous populist indignation. They haven’t the foggiest notion what it takes to run a company; they live for polls.

ddrintn on March 16, 2009 at 8:41 PM

Wait a minute, I am thinking like a becker.

They will use AIG to insure all Americans for health care.

getalife on March 16, 2009 at 8:42 PM

Wait a minute, I am thinking like a becker.

They will use AIG to insure all Americans for health care.

getalife on March 16, 2009 at 8:42 PM

I notice you have yet to comment on Ogabe wanting to charge GIs hurt in the line of duty for post active duty care….

yeah it is a tough way to earn you 4.75 an hour but I know you’ll get a memo on the official points soon.

sven10077 on March 16, 2009 at 8:45 PM

sven10077 on March 16, 2009 at 8:45 PM

Yeah, link it when he signs it.

getalife on March 16, 2009 at 8:47 PM

Related: Why Barney Frank’s Phony AIG Outrage is Worse Than the Bonuses. (instapundit)

UPDATE: HYPOCRISY: “I am mystified by Barney Frank’s desire to recall the AIG execs’ bonuses, not so much over the idea that corporate-welfare recipients should not have grandstanding demagogues chastising them for their hypocrisy, but rather the notion that someone of Frank’s ethical past would play Old-Testament railing prophet. . . . Frank received more than $40,000 in campaign contributions from the bankrupt Freddie and Fannie, despite his own role as supposed fiscal watchdog on the House Financial Services Committee. . . . So please, Representative Frank, Senator Dodd, and all the rest — give back all that campaign cash to our government, and then in silence endure what you helped to conceive.”

Keemo on March 16, 2009 at 8:50 PM

Yeah, link it when he signs it.

getalife on March 16, 2009 at 8:47 PM

when did Bush sign the “Throw All Donks in Gulags” Bill you all were whining about the last eight years?

The scary thing is Ogabe can do this without needing a law, he can inflict it through administrative rules changes and force a court case….

sven10077 on March 16, 2009 at 8:50 PM

Laughing my ass off… I just heard Limbaugh challenge Obama’s teleprompter to a national debate. Since Obama is to chicken shit to face up to Limbaugh “Mano to Mano”, Limbaugh challenged his teleprompter… Damn, that’s good!

Keemo on March 16, 2009 at 8:53 PM

Keemo on March 16, 2009 at 8:53 PM

Finally, the radio entertainer goes back to radio entertainment.

Good for him.

getalife on March 16, 2009 at 9:05 PM

Finally, the radio entertainer goes back to radio entertainment.

Good for him.

getalife on March 16, 2009 at 9:05 PM

Ogabe resigned?

or have you never heard his brilliance on how horribly flawed our Constitution is on Chicago Public Radio?

sven10077 on March 16, 2009 at 9:07 PM

I work for a large company. Every so often the company announces that if we make a certain goal in prduction, we will get a certain bonus. Even when the company loses money as a whole, we always got our bonuses if we made the quota.

Incentive bonus offers are treated as binding contracts. The concept of contract, obligation, or honor is, however, lost on the honorless lowlife cretin occupying the White House.

I used to say we should give Obama a chance. He used it up with this. Now I want the scum-sucking worm to envy the gentle treatment Bush got from the likes of Olberman. The man is beneath contempt.

Random Numbers (Brian Epps) on March 16, 2009 at 9:12 PM

Show of hands here from HA readers:

How many of you, like me, own a small business?

When (or if) you financed your start-up via a small business loan, were you handed a check, or did the bank produce what is called a “Use of Funds” agreement, and then disburse those funds under the appropriate account when properly invoiced?

The purpose, of course, is to ensure the borrowed funds get spent correctly, and for the purpose the bank loaned the money for.

I suppose that no one in Congress ever heard of such a process.

BobMbx on March 16, 2009 at 9:14 PM

I understand the point being made but honestly I’m a little tired of reading about the sanctity of contracts in this circumstance. If AIG had been so morally upright about it’s willingness and readiness to honor it’s insurance contracts to it’s clients, if it had been able to have a fraction of a chance to cover the swaps in the event of default, this conversation about the bonus contracts to it’s now government employees wouldn’t even be taking place.

tartan on March 16, 2009 at 9:17 PM

BobMbx on March 16, 2009 at 9:14 PM

Exactly the process I sent through back in 1982 Bob… Worked for me.

Keemo on March 16, 2009 at 9:19 PM

Once you give something away, IT IS NOT YOURS ANYMORE.
This is no longer taxpayer money. It belongs to AIG. So, yes, their board of directors can do anything they want with it.
The time to bitchenmoan and apply restrictions to AIG was BEFORE we gave them the money.
You should be demanding the resignation / tar and feathering of your splendid representatives who signed off on the no-strings deal to AIG, because, as usual, IT’S YOUR STUPID AGENTS IN THE GOVERNMENT WHO GOT YOU SCREWED AGAIN.
Troll Feeder on March 16, 2009 at 4:55 PM

This is a great point.

tartan on March 16, 2009 at 9:19 PM

Bonsues schmonuses.

It’s just another distraction from the real crime.

End the bailouts. Let them fail. I am sick of being held hostage by their economic terrorism.

Rae on March 16, 2009 at 9:43 PM

Wait a minute, I am thinking like a becker.

They will use AIG to insure all Americans for health care.

getalife on March 16, 2009 at 8:42 PM

Heh…yeah, right. Minus AIG’s “efficiency”; and instead of some faceless corporate types getting bonuses, it will be deadass bureaucrats just collecting their pay.

ddrintn on March 16, 2009 at 9:44 PM

The American Government people owns 80% of AIG and they aren’t acting like owners.

Wow, we own AIG! This is so cool! We’ll be rich! What a great investment!!!!!!!!!

DrStock on March 16, 2009 at 9:52 PM

Ap (Not you Allah) is reporting that they are issuing “individual subpoenas” for those who have bonuses coming. I am not kidding. So work for AIG and now your record is forever ruined because you were once “subpoenaed for Fraud”. Think they will ever work again in the Securities or Banking field?

“When they came for the Catholics, I said nothing, because I was not a Catholic”.

http://news.yahoo.com/s/ap/20090316/ap_on_re_us/aig_cuomo

GunRunner on March 16, 2009 at 10:21 PM

Let the Show Trials Start!

The best will be the videos of the sobbing Executives as they are forced to confess that they do have valid contracts and are sentenced to a mandatory 2 min of Hate.

Getalife can run the cameras! Think of the ratings!

GunRunner on March 16, 2009 at 10:28 PM

Excuse my lack of knowledge on this but…….Does AIG own the Federal Reserve?

Coastal Paradise on March 16, 2009 at 10:30 PM

Hey Dli Bama, GET MY MONEY BACK FROM FRANKLIN RAINES AND THE OTHER FANNIE MAE EXECS!!!!!! You are nothing but a……………..LIAR!!!!!!!!!!!

RealDemocrat on March 16, 2009 at 10:53 PM

http://article.nationalreview.com/?q=NDA4YTY1N2ZhMDhmNjIwNTk4OTI2MDYxZWU4NDg1Y2Q=

GET MY MONEY BACK!!!!!!!!!

RealDemocrat on March 16, 2009 at 11:01 PM

The markets will fall like a rock tomorrow.

Oink on March 16, 2009 at 11:44 PM

HondaV65 on March 16, 2009 at 5:30 PM

Doctor Zero on March 16, 2009 at 5:51 PM

Thank you. Wish I’d said it so well.

petefrt on March 17, 2009 at 12:24 AM

Once again, we see the difference between a free market and the fascist system we live under today – the instability caused by politics trumping profitability and accountability, summarized in one blindingly obvious fact: The Obama administration handed billions over to AIG without taking any steps to control how it was spent. Now they’re stumbling around with egg on their faces, desperately huddled with their media people to see if they can gin up enough public outrage to distract the voters from blaming them.

No matter how outrageous those AIG bonuses are, the simple truth is that Obama and his people handed over the cash, and now they look like blundering morons with guns in their hands, as they panic and toss out ideas like writing bills of attainder against AIG. We’ll recoup that bonus money in taxes! What a great idea. We’ll just cripple the company we bailed out with huge taxes, which they’ll avoid by various methods that will shift the costs back into the general economy… or maybe rock AIG hard enough to where they demand a fresh new bailout, reminding everyone that they’re still “too big to fail,” and Obama might be looking at impeachment if he lets them go down after spending all the tax money on the first bailout to prop them up. When you pay the danegeld, you never get rid of the Dane. Net effect: millions of taxpayer dollars poured into the pockets of politically-connected executives.

Meanwhile, the panicky bluster of the administration scares the dickens out of an already unstable market.

A private sector executive who did what Obama just did – hand over a gigantic sum of money in a poorly-negotiated deal, to be immediately made a fool of by his new “business partners” – would be gone now. No board of directors, no stockholders would tolerate this kind of cosmic-level incompetence, especially in light of Obama’s overall poor performance – and stockholders would be loudly asking how someone with Obama’s absurd resume could have been hired as CEO in the first place. But, instead, we’re stuck with this guy for years, as once again politics renders an economic actor completely immune to the consequences of his actions.

The honest, successful businessman has no reason to feel anything but fear of the Obama Administration, which will need plenty of revenue from “overly profitable” companies to finance its habit of picking market winners and losers. Not only is America, Inc. stuck with the incompetent CEO who was just made to look like a fool by his pals at AIG, but there’s every reason to think he’ll be worse in the future, doubling down on every bad investment and launching expensive new projects, even though the company’s books are bleeding red. And the CEO of every other “company” in the global marketplace knows it – it would be bad enough if America Inc. operated in a vacuum, but it doesn’t, and some of the competitors are noted for making hostile takeovers.

Doctor Zero on March 17, 2009 at 12:27 AM

In the last couple weeks we heard the Leftists, and Barcky Tredundant) making the case that billions of dollars in earmarks was really no big deal because it was a tiny percentage of the overall glut of spending. In the instant case (AIG), these millions of dollars in contractual bonus payemnts are also a tiny fraction of the overall spending, yet Barcky and the Left want to make them their Demon of the Week.

This can only be a distraction so people will not look at how painfully inept the Barcky admin has been to date.

Comment by JD — 3/16/2009 @ 8:58 pm (Patterico)

TN Mom on March 17, 2009 at 12:59 AM

sven10077 on March 16, 2009 at 6:30 PM

You’re one president off.

sethstorm on March 17, 2009 at 3:59 AM

Doctor Zero on March 17, 2009 at 12:27 AM

Honest business hasn’t existed at least since Reagan.

sethstorm on March 17, 2009 at 4:00 AM

The institution with the most power has the least due diligence and people are surprised and outraged?
So the contracts that the government could have foreseen should be broken because of the incompetence of the treasury? We already knew that AIG was irresponsible now we have proof that the government is about par for the course.

gordzilla on March 17, 2009 at 8:08 AM

Sure, I am outraged as well, but what many are forgetting is that this money was given to AIG and other hand-picked companies with NO STRINGS ATTACHED!!!! Another clear picture, at least for me, that our dear elected officials don’t read first what they vote on!!! Had they studied this and other companies they are bailing out before throwing the money at them, they would have known that there were contracts in place!!!! Do I need to say “Stimulus Bill”?
I would be very upset if I got a loan – or a grant for that matter – to help out my business, and then, after I accepted it, I was told that I could only do certain things with this money! Why not spell out the rules of the game BEFORE we start playing!!!!!?????
I am a small business owner, and if I make decisions that will hurt my company, I will have to either close my doors or figure out ways to change my way of doing business. We – actually Congress, but since we elected these buffoons, it is WE – gave this huge amount of money to companies who had done bad things, thus telling them to keep on keeping on… Now we are all outraged that they are doing exactly that????
I am AGAINST any government interference in business! Every time it has been tried, it was bad! But we are stuck – at least for now – with the clowns we elected to office! All we can do is make a lot of noise and continue to make it, and hope that SOMEONE will listen! If they don’t there is another election coming up some day (not a day too soon for me)…

mkosin on March 17, 2009 at 8:20 AM

What makes people think the bonuses are a bad deal? $165 million is a lot of money compared to what I make, but it’s not much compared to the $2.7 Trillion that the bonus earners earned for AIG.

It’s also not much compared to the $700 million that AIG loses if just ONE of those guys does a poor job, and fails to adjust their portfolios for just 1 interest rate change of 1 basis point. And these guys make that sort of decision every day.

lastly – if AIG doesn’t pay the bonuses, then the CDS holders can claim that it’s a “cross default” which means they can leave AIG (and us) holding the bag on the credit default securities. Does THAT sound like a good deal? Those securities are, after the bubble’s burst, billions, in debt that would crush AIG, and start the domino effect of businesses shutting down.

It’s also a drop in the bucket compared to the money that the govenrment wastes every day.

hawksruleva on March 17, 2009 at 10:27 AM

hawksruleva on March 17, 2009 at 10:27 AM

Nice talking point, but if they were on the brink of bankruptcy, that is not enough to save them.

Don’t let them pay the bonuses and let the company kill itself.

sethstorm on March 17, 2009 at 11:43 AM

Shouldn’t a constitutional scholar like BHO know what a bill of attainder is??

ex Dem from Miami on March 17, 2009 at 11:44 AM


A private sector executive who did what Obama just did – hand over a gigantic sum of money in a poorly-negotiated deal, to be immediately made a fool of by his new “business partners” – would be gone now. No board of directors, no stockholders would tolerate this kind of cosmic-level incompetence, especially in light of Obama’s overall poor performance – and stockholders would be loudly asking how someone with Obama’s absurd resume could have been hired as CEO in the first place. But, instead, we’re stuck with this guy for years, as once again politics renders an economic actor completely immune to the consequences of his actions.
The honest, successful businessman has no reason to feel anything but fear of the Obama Administration, which will need plenty of revenue from “overly profitable” companies to finance its habit of picking market winners and losers. Not only is America, Inc. stuck with the incompetent CEO who was just made to look like a fool by his pals at AIG, but there’s every reason to think he’ll be worse in the future, doubling down on every bad investment and launching expensive new projects, even though the company’s books are bleeding red. And the CEO of every other “company” in the global marketplace knows it – it would be bad enough if America Inc. operated in a vacuum, but it doesn’t, and some of the competitors are noted for making hostile takeovers.
Doctor Zero on March 17, 2009 at 12:27 AM

Great post.

tartan on March 17, 2009 at 9:22 PM

The honest, successful businessman has no reason to feel anything but fear of the Obama Administration,

Perhaps those companies weren’t as honest as thought.

sethstorm on March 17, 2009 at 10:18 PM

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