AIG requests more bonus money
Filed under: Company News, People
AIG (AIG) wants to pay out more bonus money to executives, and why not? They probably earned it.
The insurance company, which is largely owned by the U.S. government, is asking the Administration whether it should pay $235 million that it agreed to give to workers in its financial services division. Most of the bonus agreements were set up to retain employees.
According to The Wall Street Journal, AIG has gone to the government to seek "an agreement that lets employees keep enough of the promised bonuses to serve as an effective incentive, but reduces the payments by enough to make them more palatable to the public."
But the bonus issue should not turn on whether the payments are "palatable"; it should turn on whether the employees are essential to AIG's future and whether promises to give the bonuses were made in good faith. AIG's financial success is a financial success for taxpayers. Its failure would cost taxpayers as much as tens of billions of dollars. Bonuses of $235 million are a small price to pay to people who may be essential to producing future earnings.
The government has gotten into the bad habit of labeling all executive bonuses as bad for taxpayers and bad for PR. When essential managers walk out the doors at AIG that approach will be proved a failure.
Douglas A. McIntyre is an editor at 24/7 Wall St.
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Reader Comments (Page 1 of 2)
7-10-2009 @ 8:22AM
Bill said...
I would say unbelievable but nothing is beyond belief in the financial markets today. The bonuses are being used to retain valuable employees? Lord knows they did a wonderful job. If they think they can go out and get a better deal somewhere else, let them do it. I'm sure Goldman Sachs is willing to give away millions or should I say billions to some of it's stellar employees since they were also able to bilk the taxpayers out of billions of dollars. What a country!
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7-11-2009 @ 12:41PM
david said...
No bonuses how about a wage CUT until the money is payed back & the forecloser stop or the PEOPLE of the UNITED STATES stop lossing there JOBS there RETIREMENT people in this country worked and payed taxes so they could lose every thing. Then take our tax money to save there jobs .They sould be taking a WAGE CUT like the working class that is the UNITED STATES . I took a wage cut so my company could stay in bussines like so many AMERCANS did . We did not cause this CORP. GREED did .The IRS should investagate these C.E.O. s and take there HOMES & there MONEY .
7-11-2009 @ 10:13AM
TONY said...
AIG OWES ME $623.00 FOR EXPENSES I LAID OUT BEFORE MY CASE WAS LABELED COMPENSATION AND FOR 4 YEARS THEY HAVE BEEN REFUSING TO GIVE IT TO ME....A LOUSY $623,00.....BUT THEY HAVE MILLIONS FOR BONUSES.....I HOPE THEY FOLD UP TODAY AND EVERYONE OF THOSE FUCKS LOSE THEIR JOBS AND COVERAGES....THEN THEY WILL SEE WHAT IT IS REALLY LIKE TO STRUGLE......THEY ARE NOTHING MORE THAN THEIVES USING OUR MONEY FOR JUNKETS TO VEGAS FOR THEIR OWN PLEASURE....CLOSE UM UP.....NOW....
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7-10-2009 @ 10:35AM
Tom said...
I am a taxpayer. I am therefore an owner of AIG. I will not pay any employee of AIG a bonus until that company has repaid the money I gave it to avoid its collapse. I will watch my representatives in the Senate and the House to ensure that they comply with my demands.
Should they not comply, I will vote them out. I will further assist in election campaigns against any representative who supports the stupifying waste of my money by providing bonuses to people who are not merely tragically incompetent, but corrupt predators feeding at the public trough.
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7-10-2009 @ 11:33AM
Jack said...
As a 38 year science teacher I never got a bonus despite the fact that my students did well on National Tests and in college. These idiots ran a company into the ground and get rewarded for it!?! I love the part about needing to give them a bonus so they'll stay with the company. Where are they going to go? Who's hiring, and why would anyone want to hire these numbskulls!
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7-10-2009 @ 11:54AM
jeff said...
In my world (and most others) bonuses are PERFORMANCE BASED. The discussions should be more focused on cutting salaries and terminating these idiots. Fire the guy who even brings up the subject of bonuses.
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7-10-2009 @ 11:57AM
gaylord manley said...
how can this even come up for discussion and what r the people still doing there when they were part of the scheme. go bak and check files to see how much they were paid in the last 10 years and make them pay bak 80% of it and then out the door. i would like to see some hog farmer in iowa appointed ceo. our chance of an honest operation would increase. out the door turn off the spigot. some nerve
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7-10-2009 @ 6:30PM
mgann said...
RIDICULOUS!!!!!! Their fricken bonus is they have a FLIPPIN job. They should of let the company go bankrupt. The company was ran by nothing but a bunch of THIEVES... AND THE LEADERS OF THE U.S.A. ARE LIARS AND THIEVES AS WELL.
1. Bankrupt a company = million dollar bonus +++++
2. Liars and thieves = get rewarded for it
3. Management that makes horrible decisions = keep them on, promote them and give them a millions for a bonus to boot... and while your at it TAX me MORE AND MORE.........MAKES SENSE TO ME.
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7-10-2009 @ 12:12PM
Jim said...
Bullshit plane and simple.
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7-10-2009 @ 12:21PM
Barbara said...
Pay them minimum wage per hour and have them work 12
hrs. a day, 7 days a week. Hopefully this will teach them
something they were not taught in business school.
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7-10-2009 @ 12:29PM
DR said...
I'm sure there are at least 10 people standing in line to take the place of anyone who decides to leave AIG. No bonus...let them leave!!! Someone better will move in and given the nature that got AIG in this position, I'm sure the new person will work harder to not let it happen again, so they can keep their newlly obtained job with good pay and maybe one day when AIG is again successful, they might be in line to receive a bonus!
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7-10-2009 @ 12:31PM
David said...
If their base salary is low and the Bonus is part of their total salary, which is common in the finacial area, then the bonus is justified. I the salary is high to begin with then the bonus is not justified
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7-10-2009 @ 1:23PM
Max said...
I was ripped of twice once as a stockholder and the second time as a taxpayer
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7-10-2009 @ 1:24PM
MamaB2C said...
"When essential managers walk out the doors at AIG"
Walk out the door to go where? How many higher paying executive positions are in need of filling in the financial insurance industry? How will it look on their resume that they were a failure at running AIG and left because they didn't get a bonus for failing?
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7-12-2009 @ 11:48PM
RSHEP said...
I would start with the people that will authorize these bonuses and walk them out of the door with security. I agree that I will scrutinize very carefully the politicians that have oversight on AIG, and make sure that they would be ousted from the government. I am retired and have time to take an active part in working to that end.
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7-10-2009 @ 2:39PM
Roney said...
No. AIG does not deserve any more of taxpayers money. They have put a freeze on an annuity from my late husband, and I am designated as the beneficiary, his spouse. Now AID acts like it does not know who the beneficiary is, and I have been listed as beneficiary since the inception for the past 13 years. No AIG execs do not deserve anything. What for, What are they doing, their stock is a penny stock and the company is still begging for more money from the government. What for!!!! It's been more than a year I have been waiting for my money from AIG, Let the suckers wait for their funds too :)
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7-10-2009 @ 2:59PM
william said...
this is why this country is in the toilet...the french revolution,,LET THEM EAT CAKE ,,, let these guys eat twinkees....NO BONUSES OBAMA FOR THIEVES...
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7-10-2009 @ 3:26PM
alydar said...
AIG (All Insidious Gnomes) -- bonuses?? -- -spell it for what it means- - boneU.S. taxpayers--
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7-10-2009 @ 3:34PM
JOAN said...
AS A SENIOR CITIZEN WHO IS "NOT" GETTING ANY COST OF LIVING RAISE IN 2010, I FEEL WE ALL ARE PAYING FOR THIS! AND WHEN IS OUR PREZ GOING TO STEP UP AND MAKE THEM STOP???
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7-10-2009 @ 3:44PM
Donnie Knoxville said...
Screw them let them find a new job.
I want to apply for one of their jobs.
Hell I couldn't do any worse!! I could use the money!
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