So what I get so far from this thread is the blue collar workers can get crapped on all day, but don't touch those wall street elites. Yes, lets pay huge bonuses to the same idiots that ran the company into the ground. Sounds like a great plan to me. That money is gone, and they are working us for more every few weeks.
AreaCode707
Lifer
- Sep 21, 2001
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Non-sarcastic post: the media has been all over the AIG scandal, far more than the poor hand dealt to the blue collar workers. Can you help educate me on the areas where they got screwed? You talking about layoffs, pay cuts, benefits changes, union negotiation failures, pension plans taking a dive due to changes to the dollar?
Yes many companies have lots of VPs, especially banks I hear. But how many executive VPs are at your company?
AreaCode707
Lifer
- Sep 21, 2001
- 18,440
- 101
- 91
None; we don't use that title. Every company uses titles differently, so there is no way to accurately predict what "executive VP" means at any given place.
fyi, $700000 is approx 10 yrs worth of work for me I'm also on call 24 hrs a day(IT). i'm not gonna pay this guy 10 times my salary with my tax money without just cause.
AreaCode707
Lifer
- Sep 21, 2001
- 18,440
- 101
- 91
Then we shouldn't have given them the bailout money. We knew, when we did it, that they were under contract for these salaries. We don't get to pick and choose what parts of the company we bought, which obligations of the company we live up to.
The bailout was a huge fuckup idea. However, once you're in, you're in. You don't get to rewrite laws for your own convenience.
the bailout was a good idea, to save ourselves from financial market collapse which may very well have lead to another depression.
but i do not support bailing out rich/overpaid exec.
fyi, they are writing laws to get money back... you need to just get over it.
Fingolfin269
Lifer
- Feb 28, 2003
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nobodyknows
Diamond Member
- Sep 28, 2008
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Their contract wasn't invalidated, instead Congress changed their tax rate after the fact.
Basically, this is Congress (due to all the public outrage that AIG execs are getting bonuses after we gave them bailout money) realizing that it is THEIR fault this public outcry is happening. They don't want to be linked to it politically, so they go "You know what Mr. Public? You're right, so we will tax them more to get that money back. Then we aren't tied to the fact we passed the law without any strings attached to giving them money, and we look like we listen to the public!"
LTC8K6
Lifer
- Mar 10, 2004
- 28,520
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nobodyknows
Diamond Member
- Sep 28, 2008
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frostedflakes
Diamond Member
- Mar 1, 2005
- 7,925
- 1
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I'm surprised these people aren't just laying low for a while to see how this all plays out. It's sounding like the 90% tax won't even make it through the Senate, much less past Obama's desk. The resignations seem a bit hasty to me.
nobodyknows
Diamond Member
- Sep 28, 2008
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So they're taking their ball (and their bonuses, courtesy of US taxpayers) and leaving. Yeah globalization!!! Yeah smaller government!! Yeah Bush!! Fuck you, US Taxpayer!!
Sorry Fern, I had to rant.
AreaCode707
Lifer
- Sep 21, 2001
- 18,440
- 101
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Original: We can't let AIG fail; all these individuals will be out their insurance and mortgage payments!
Current: We can't let AIG fail; all these individuals will be out their insurance and mortgage payments and the taxpayers will be out their bailout money!
Problem is, AIG is most likely going to fail anyway. Both of those options above suck; which one sucks more, in your opinion?
AreaCode707
Lifer
- Sep 21, 2001
- 18,440
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Are you a home owner? On an adjustable rate mortgage? (Not suggesting you are, just asking.)
I can guarantee that target taxing these bonuses is going to lead to a whole lot of problems, and you will still maintain all the while that this was a good idea.
Cause: Homeowner takes out an adjustable rate mortgage
Effect: Homeowner can't make payments any more; homeowner claims that it still originally was a good idea but that the mortgage company should do something to make it possible for them to keep their house!
Cause: Company shuffles around debt to cover more defaulting homeowners than they should
Effect: Homeowner keeps their house but company is now unstable and liable to fail; company claims that shuffling debt was still a good idea but the government needs to help RIGHT NOW to prevent bankruptcy
Cause: Government issues a bailout with few restrictions or provisions, enable company to keep running
Effect: Since bankruptcy was avoided, the bailed out company still owes on original retention bonus contracts and since there were no earmarks for the bailout money, it legally can and must be used to pay those contracts; government claims the bailout was still a good idea but that Congress should do something to prevent the bonuses from being paid
Cause: Government can't keep bonuses from being paid without changing the fundamentals of contract law so they decide to target tax these bonuses at 90%
Effect: Execs lose their bonuses, feel cheated, and quit, and the company continues to tank due to lack of leadership. Company begs Congress for more help.
Cause: Congress, now that there is a precedent of target taxing, decides to target tax several other specific groups of people and give the money to the company. Rinse and repeat until even cash infusions can't save the company
Effect: AIG and other related companies go under, taking billions in taxpayer dollars with them
Cause: Not only does the original homeowner in the scenario lose their house but now so do a lot of other people who were not originally at risk of losing their homes but are now over-taxed, out of work and unable to find more jobs.
Effect: Government takes more and more control over individual funds and redestributes them to try to support the out of work populace.
I'm clearly extrapolating in my last two examples and the effect right before that, since those are in the future, but I'm sure you get my point. You cannot save us from ourselves.
Anytime government gets into the "I know better than you (individual) how to manage your money" they start having to get into the little details. Since government is run by people motivated by re-election they often take the popular route rather than the long-term right move. Our US government was not constructed for this type of administration and when it focuses on trying to fully control the economic situation and keep people in jobs and homes without regard for the economic realities, it will inevitable both fail and make the situation worse.
You're right, they probably will target tax these execs. You view this as a good thing that will somehow solve a problem. I view this as another time the government is doing a short-sighted fix that is going to spawn a whole mess of new problems. They didn't stop a depression; they postponed it and made it significantly worse than it otherwise would have been.
LTC8K6
Lifer
- Mar 10, 2004
- 28,520
- 1,575
- 126
Well, it was pretty stupid for Congress and Obama to trash AIG if they were trying to bail it out of it's troubles. It will need a good reputation to right itself.
The phony bonus outrage was a really dumb thing to be doing, imo, if AIG couldn't be allowed to fail.
Makes no sense at all to viciously attack a company, for a trumped up reason, if it was so important to the economy that it had to be helped at such a cost.
It seem they decided that the political gains to be had from attacking the bonuses were more important than AIG's survival.
Obama seems to have realized it was stupid as he has basically shut up about it and congress has quietly forgotten about taxing the bonuses for now, but it may be too late.
The phony bonus outrage was a really dumb thing to be doing, imo, if AIG couldn't be allowed to fail.
Makes no sense at all to viciously attack a company, for a trumped up reason, if it was so important to the economy that it had to be helped at such a cost.
It seem they decided that the political gains to be had from attacking the bonuses were more important than AIG's survival.
Obama seems to have realized it was stupid as he has basically shut up about it and congress has quietly forgotten about taxing the bonuses for now, but it may be too late.
He is not making $1 a year he still gets to keep 10% of his bonus and gets health benefits. He would be unemployed right now he we let the POS AIG fail. Its tax payer money and I don't want to pay a dime to keep these employees working in a zombie institution that should of failed months ago.
sad but its true, it cannot fail now, it will result in depression...
when economy gets better, kill it.
Obama and Congress do not give a shit about AIG. They just want to save their own ass... They do not want an angry mob of people with pitch forks forcing Obama and Congress to resign. The majority of the country does not give a shit about AIG. AIG is a zombie institution being used as a conduit to pay out insurance contracts and billions in trading profits to Goldman Sachs and other financial parties. We the people should start demanding Goldman Sachs gives the tax payers part of their profits back to the tax payers because without us they would not be collecting on that money.
AIG is going to continue draining billions until the transfer of wealth from the tax payer to the banks is complete then they will let it fail assuming no more systematic risks are left.
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