Statesman: AIG Bonuses Fair?

11 comments on this post so far. Add yours!

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  Charlie on March 20 at 8:47 a.m.

  Whether the AIG employees deserve the “bonuses” or not is not the question at this point. The question I have , Is the tax bill the house passed a “Bill of Attainer” which if directed at AIG employees would be unconstitutional according to attorney David Boies and wikipedia. If the law is spread out to cover “ALL” bonuses from “ALL” employment, it might pass the smell test. I am not nor ever have been an attorney. Maybe one of our legal eagles can clarify it. Too much time and effort is going into this dust up, what is really going on that congress is hiding??

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  toadman on March 20 at 10:10 a.m.

  This issue is more complex than this simplistic questionnaire leads us to believe. None of this is black and white, it’s all so very, very, gray. But that’s just how I see it…

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  Arch_Druid on March 20 at 10:22 a.m.

  As I understand the tax on bonuses correctly, only those who received TARP funds and used them to pay fantastic bonuses to select employees would be taxed to recoup the money.

  I had certainly heard Edward Liddy and his attempts to excuse the poor performance of those retained by AIG to receive the bonuses because of a “legally binding contract.” However, how does one justify bonuses paid to people no longer employed by the firm? Once they leave, such a contract should no longer be valid. Nor could they legitimately sue if they are former employees. And because of the language Liddy used, now Fannie Mae or Freddie Mac also want to use TARP funds to proffer bonuses toward select employees who sure didn’t do their respective firms any kind of favor.

  I can understand Congressional rancor. Now they are trying to fix the mess that loophole created.

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  sue on March 20 at 11:49 a.m.

  Seems to me a bonus would require some level of achievement. If bonuses were given when the company was failing, the bonuses were fraudulent compensation, and there should be legal ramifications. I wish the legislators had chosen to go that route, but however they get it back is good. They’re not targeting specific individuals, just companies and employees who fit a certain criteria, that is, having received tarp funds, and having received bonuses. It will affect many businesses apparently for taxes collected this year and due April 15th 2010. Those who want to cry for those overcompensated executives can do that, using tired old political hackery. Rush must’ve taken that tack for us to be hearing so much about it.

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  jreighley on March 20 at 2:00 p.m.

  Now my understanding is that the division in question is a London based division.. So, it is most likely staffed substantially with British citizens working in Britain… Well outside of the reach of the IRS. I am not sure it makes much difference at all…

  AIG promised these bonuses to employees who where winding down and unprofitable division.. They had zero future with the company.. This bonus was paying them to kill off their own job. The bonus was the only reason they didn’t jump ship earlier, making an even bigger mess.. It is absolutely wrong, and quite illegal for AIG to withold the bonuses.

  If the Government wanted AIG to be able to renigg on their business obligations, they should have allowed them to go bankrupt. Unless you are bankrupt, you need to keep your obligations.

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  Me on March 20 at 9:44 p.m.

  Arch - and does loophole begat loophole? This whole thing stinks to me - from those getting these bonuses to those taxing the bonuses. Do I think there is some big conspiracy theory at work here? No. Do I think someone in power might take advantage of this ‘special tax’ someday - yep. If there is a chance for someone to be slimy and get something they shouldn’t, they will.

  So for NOW it is only those receiving tarp funds, but what might that morph into?

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