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2009-03-18 Home Front Economy

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Posted by Fred 2009-03-18 00:00|| || Front Page|| [4 views ] Top

#1 Condensed version of this story:

Congress Acts Like It Doesn't Read the Legislation it Passes.

Posted by badanov 2009-03-18 00:15|| http://www.freefirezone.org]">[http://www.freefirezone.org] 2009-03-18 00:15|| Front Page Top

#2 At Mr. Wife's Fortune 500 employer, even middle managers receive up to half their wages as performance bonuses. However, bonuses are portioned out from the net profits the entire company earns, based on business unit and individual performance, calculated in some terribly complicated but no doubt logical way. Bottom line, if the company had no profits, there would be no money for bonuses... all the way up to the top. Loans don't go to profitability, I believe, but it appears AIG defines things differently.

Posted by trailing wife">trailing wife 2009-03-18 02:07|| 2009-03-18 02:07|| Front Page Top

#3 TW, these are retention bonuses. They go to hard to replace people. My wife gets these bonuses. They are awarded in one year and paid out if you stay another 2 years for example.

It's common for people paid these bonuses to leave shortly after recieving the bonus. The fact they leave after recieving the bonus is good evidence the bonuses work, because the purpose of the bonus is to keep the individual for the period until the bonus is paid.

And BTW firing someone shortly before they are due to recieve a retention bonus would almost certainly result in legal action by the person involved.

Posted by phil_b 2009-03-18 06:22|| 2009-03-18 06:22|| Front Page Top

#4 Agreed, phil. And the White House, Bush and PBHO knew about these agreements long ago. They were kept under wraps so that the shouting would start after the checks cleared.

If you want to beef about these, your real question should be whether it would have been better to let AIG (and Bear Stearns) go BK instead of nursing them.

I tend to believe so, though the crisis would have been deeper, it would have been shorter, less expensive, and better lessons would have been learned. I don't like socialism and that's where we're headed.

But enough on the bonuses. The guys did the work and should get the amount agreed to at the start of the deal. If we start rewriting contracts, we'll look like zimbobway soon.

Posted by Nimble Spemble 2009-03-18 07:15|| 2009-03-18 07:15|| Front Page Top

#5 TW, these are retention bonuses.

Thank you for explaining, phil -- I didn't know there was a difference.

Posted by trailing wife 2009-03-18 08:58|| 2009-03-18 08:58|| Front Page Top

#6 "Thus, last week, AIG made more than 73 millionaires in the unit which lost so much money that it brought the firm to its knees, forcing a taxpayer bailout," Cuomo said. ....The government-appointed AIG boss Edward Liddy claimed in a Saturday letter to Treasury Secretary Timothy Geithner that the bonuses were necessary to retain 'the best and brightest talent'.

Logic? or the The Sting: The Treasury.

Posted by Procopius2k 2009-03-18 09:03|| 2009-03-18 09:03|| Front Page Top

#7 Ring me up when Barry resigns.

Posted by Besoeker 2009-03-18 10:04|| 2009-03-18 10:04|| Front Page Top

#8 Its a shell game. If AIG had gone Chapter 11 the judges would look at these contracts and renegotiate or nullify them or make them last in line. I understand the contracts were committed only after the first round of bailout. If so, then there may be a fraud case here. I received bonuses for 15 years and only because my company and its divisions made profit. We were in the engineering and construction business and when we priced out a job we included a 20% hair cut on our gross margin for profit sharing should the project perform and succeed. If you lose money because you thought you were the smartest guy in the room - no bonus especially retention bonus - who'd want a smart guy who turned his business into a loser?

Posted by Jack is Back!">Jack is Back! 2009-03-18 10:10|| 2009-03-18 10:10|| Front Page Top

#9 It doesn't matter if some of the beneficiaries performed well. Nobody gets bonuses during an austerity regime. Period.

Posted by Thriling Oppressor of the Heathen Rus5144 2009-03-18 15:32|| 2009-03-18 15:32|| Front Page Top

#10 While I don't believe that bailout money should go to bonuses of any kind, especially when I believe the company should have gone bankrupt anyway, the fact that the dhimocrats and the White House knew about the bonuses and approved the money and now are making a huge fuss about is a disgrace. They gave them the money without strings, they don't have a single legal right to demand it back. I think they are desperately trying to cover their own bribes they received from AIG by demonizing the company.

Posted by DarthVader 2009-03-18 15:38|| 2009-03-18 15:38|| Front Page Top

#11 Take the money and run....

Posted by Zenobia Slelet3412 2009-03-18 16:05|| 2009-03-18 16:05|| Front Page Top

#12 Congress is the problem all right. Here is a concise statement as to the real nature of the problem.
-----------
545 PEOPLE
By Charlie Reese
Politicians are the only people in the world who create problems and then campaign against them.

Have you ever wondered, if both the Democrats and the Republicans are against deficits, WHY do we have deficits?

Have you ever wondered, if all the politicians are against inflation and high taxes, WHY do we have inflation and high taxes?

You and I don't propose a federal budget. The president does.

You and I don't have the Constitutional authority to vote on appropriations. The House of epresentatives does.

You and I don't write the tax code, Congress does.

You and I don't set fiscal policy, Congress does.

You and I don't control monetary policy, theFederal Reserve Bank does.

One hundred senators, 435 congressmen, one president, and nine Supreme Court justices 545 human beings out of the 300 million are directly, legally, morally, and individually responsible for the domestic problems that plague this country.

I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered, but private, central bank.

I excluded all the special interests and lobbyists for a sound reason. They have no legal authority. They have no ability to coerce a senator, a congressman, or a president to do one cotton-picking thing. I don't care if they offer a politician $1 million dollars in cash.
The politician has the power to accept or reject it. No matter what the lobbyist promises, it is the legislator's responsibility to determine how he votes.

Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con regardless of party.

What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits. The president can only propose a budget... He cannot force the Congress to accept it.

The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes. Who is the speaker of the House? Nancy Pelosi. She is the leader of the majority party.
She and fellow House members, not the president, can approve any budget they want. If the president vetoes it, they can pass it over his veto if they agree to.

It seems inconceivable to me that a nation of 300 million can not replace 545 people who stand convicted -- by present facts -- of incompetence and irresponsibility. I can't think of a single domestic problem that is not traceable directly to those 545 people. When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.
If the tax code is unfair, it's because they want it unfair.

If the budget is in the red, it's because they want it in the red ..

If the Army & Marines are in IRAQ , it's because they want them in IRAQ

If they do not receive social security but are on an elite retirement plan not available to the people, it's because they want it that way.

There are no insoluble government problems.

Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power. Above all, do not let them con you into the belief that there exists disembodied mystical forces like "the economy," "inflation," or "politics" that prevent them from doing what they take an oath to do.

Those 545 people, and they alone, are responsible.

They, and they alone, have the power.

They, and they alone, should be held accountable by the people who are their bosses.

Provided the voters have the gumption to manage their own employees.

We should vote all of them out of office and clean up their mess!

Charlie Reese is a former columnist of theOrlando Sentinel Newspaper.

Posted by Alaska Paul 2009-03-18 16:26|| 2009-03-18 16:26|| Front Page Top

#13 I am sooooo emailing that piece by Charlie Reese to people.

Thank you Alaska Paul!

Posted by DarthVader 2009-03-18 17:34|| 2009-03-18 17:34|| Front Page Top

#14 Here is the AIG thing in a nutshell. Comment from the Belmont Club:
--------------
4. Fat Man:

The feigned outrage over bonuses to AIG employees is like a three card monte game. The real purpose is distract the spectators while the card players confederates pick their pockets. AIG was a conduit for over $170 billion to its counter-parties like Goldman Sachs. The bonuses were 1/10th of 1% of that amount, and what is worse, 1/100th of 1% of the $1.5 trillion that Congress has appropriated since Jan 20. The spectators are the taxpayers. The three card monte players are the politicians.
Mar 18, 2009 - 2:29 pm

Posted by Alaska Paul 2009-03-18 20:08|| 2009-03-18 20:08|| Front Page Top

#15 This administration is 'all in' with distraction and deflection. Unfortunately for them, the American people are savy enough to see through it.

Posted by Besoeker 2009-03-18 20:11|| 2009-03-18 20:11|| Front Page Top

#16 I totally agree NS.

Posted by Broadhead6 2009-03-18 22:10|| 2009-03-18 22:10|| Front Page Top

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