America is outraged at the hubris displayed by AIG in distributing over $200,000,000 in bonuses to a handful of executives. The American People own 80% of AIG, yet the company and its government overseers, Secretary of Treasury Geitner and the Congressional committee chaired by Senator Christopher Dodd of Connecticut, saw fit to pay retention bonuses to the very individuals who ran the company into the ground. America is angry. And my perception of the obvious is most astute.
Some pundits say that the anger is unjustified and that it is just another expression of liberal "wealth envy" and hatred of capitalism. I'm liberal, and I love capitalism. What I believe drives most Americans' anger is not the desire to punish AIG executives, which I am sure is justified in some cases. And I don't think many expect the AIG execs to somehow return their ill-gotten booty to government coffers so it can be redistributed to those who need it more.
What angers Americans is that we want to see other Americans succeed in this horrible economic climate because they worked hard, made good decisions when the odds were against them, and made wise decisions in good times that would protect against the negative effect of a economic downturn.
We want to hear about investors who had the savvy to pull out of the market just before the crash. We want to hear about banks that knew not to jump into the cesspool of sub-prime mortgages. We want to hear about insurance companies that remain solid in spite of hurricanes, wildfires, floods, and tornadoes. We want to hear about companies who turn a profit because they have a superior product, not because they had a good run of luck in the derivatives markets.
Americans want to see success rewarded because of smart work, hard work and good work. America does not want to see other Americans rewarded for failure, bad decisions, and costly decisions. America does not want to reward the undeserving just because they negotiated a contract that included a few selfish turns-of-phrase or strategically placed words. America wants to reward hard work in tough times, not well-placed words in a complex contract.
To see failure rewarded runs contrary to the American Dream. The American Dream is based on a healthy mix of hard work and good luck, not strategic words and loopholes.
Oh, I'm with you. That "redistribute" language drives me crazy. I don't think any AIG bonus money should be returned for any other reason than merit...or lack of merit.
Posted by: The Hiker | 03/24/2009 at 11:18 AM
I do have to disagree on one point. It's this statement that drives me nutts "return their ill-gotten booty to government coffers so it can be redistributed to those who need it more." It's not our goverments function to redistribute wealth. Please tell me just where in our Constitution it is written that one of the functions of goverment is to redistribute anything. Taking from one to give to someone else is just wrong. I dislike greedy people, as I believe it is our civic duty to care for one another but I will not condone taking from one to give to another. Who makes up the list of what is worthy and what is needed? Its just plain wrong.
Posted by: Stephen Hull | 03/24/2009 at 10:08 AM
Steve, Thanks for the comment!
I agree about Dodd and Geithner . . . and Paulsen, Bush, and Gramm. Keep in mind that it is not government intervention if the company comes a beggin'! Intervention is governmental initiative. A rescue of a failed company is not intervention...it is receivership. Big difference.
O'Bama is a constitutional law expert, and even he agrees that the 90% tax proposal is a farce. And, yes, it is very dangerous. Any lawmaker who put his/her name on that bill should be rejected by the voters and booted out of office. Ridiculous...tyranny of the majority at its worst. The bill will stall in committee, and if it passes, it will be vetoed.
Posted by: The Hiker | 03/24/2009 at 08:49 AM
Overall, a good column. I am angry that we are rewarding failure by propping these companies up just as you said in your column. We should have let them fail, and help the well run banks and insurance companies soak up the assets with some goverment assistance if it were needed. The Darwin theory of "survial of the fittest" works well in a capitolistic society, it is Gov't intervention that mucks up the works. I blame Gietner, Dodd, Frank, and the rest of the clown brigade. I am just as angry over the Houses measure to tax those bonuses by 90%. What's next? Taxing polictal enemies, companies you don't like, people who belong to religions you don't believe in???? Extremely dangersous territory, what are your thoughts?
Posted by: Stephen Hull | 03/23/2009 at 07:46 PM