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Everything you need to know about AIG, bailouts, and bonuses

FoxBusiness is currently featuring this graphic, courtesy of OpenSecrets.org:

AIG_Recipients.jpg

There's more on the AIG-Dodd story over at PoliGazette, where blogger Michael Merritt notes that the actual amount of money received by Dodd from lobbyists, PACs, executives, employees, or families of people affiliated with AIG (corporations themselves rarely make official campaign donations) could be as much as $148,000 or more.

As of this writing, the OpenSecrets website was down. Perhaps lots of us little folks -- the ones who supposedly "really don't care" about what Congress does -- really do care after all. (OpenSecrets is up and running again. Here's a direct link to their info for AIG).

And in related news, Sen. Chris Dodd now claims that he did not insert the 11th hour Stimulus bill provision guaranteeing the payout of executive contractual bonuses negotiated on or before February 11, 2009, and has no idea how that language got into the bill. Gosh, if Congress or the President had only read the thing first ...

It's hard for me to decide which element of the AIG story is the most infuriating -- the bailout itself, the phony grandstanding by "outraged" Democrats and the Obama Administration, or the audacity of Congress to propose special excise tax rates of 95% to 100% in order to "recover" the bonus money.

Which leads me to wonder, once our Democrat overlords in Congress are through with AIG -- especially if they succeed in creating a special 100% excise tax rate -- who or what will they target next, since it will then be legal for Democrats to threaten their enemies with a 100% tax rate. After all, the power to tax is also the power to destroy.

MORE: From Megan McArdle:

I think it's safe to assume that if this passes, any banks that possibly can will rush to return bailout funds to the Treasury. And perhaps this is a good thing. But the attempt to shield shaky banks behind a general distribution of funds will be over.

I suspect that it would also not do any good things for whatever future plans Treasury has. All of the plans I'm currently aware of involve substantial voluntary participation from sound financial institutions. I don't think you'll get much voluntary cooperation from banks if you declare that any acceptance of government funds will involve substantial risk that they will appropriate your paycheck.

And bonuses may not be AIG's real problem:

AIG disclosed on Sunday night that it has given over $100 billion (with a B folks) -- more than half of the $173 billion in federal dollars -- to other financial institutions and state municipalities.

The Wall Street Journal this morning characterized this as money-laundering by the U.S. government to surreptitiously give aid to foreign-based financial institutions, such as Societe General, the France-based European financial services company, which has received $11.9 billion from AIG since last September.


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Comments (15)

Are their return on investm... (Below threshold)
kevino:

Are their return on investment is huge. The banking, finance, and insurance industry gives millions to Democrats, and they get back tens of billions. Not bad. If the New Order is for the State to control more of the economy and control access to capital, there will be much more of this in the future.

As P.J. O'Rourke once said, "When buying and selling are legislated, the first thing to be bought and sold are legislators."

Yesterday, I heard Sean Han... (Below threshold)
TOhio:

Yesterday, I heard Sean Hannity on his radio show read an excerpt from a November, 2008 article in The New York Times (a liberal newspaper) that basically stated that Timothy Geitner was involved in every single meeting about AIG and all the other bailouts. This one of the reasons why the politicians wanted Geitner (the tax cheat) for Treasury Secretary. He was already heavily involved in the whole thing.

It's quite interesting that Timothy Geitner is not being mentioned at all during all this broo-ha-ha over the bonuses.

Obviously, Obama, Dodd and others are grandstanding to divert attention away from their own involvement in it. They keep attacking these Wall St. people like they are Republicans, but most of them are Democrats. Your chart about their political contributions is good supporting evidence of this fact, too.

I hope that the whole thing backfires in Obama's face.

Maybe this will help more people see Obama and the rest of the Democrats for the liars that they are.

The outrage should be less ... (Below threshold)
_Mike_:

The outrage should be less at AIG, which was known at the time to be a company that made bad business decisions (from the fact that it was going bankrupt) and more towards the politicians that simply threw money (our money) at a failing business and hoped that everything would work out. Hope is not a plan.

I just came across this oth... (Below threshold)
TOhio:

I just came across this other interesting article from Pajamas Media that shows how Obama's campaign got $3,617,724 in campaign contributions from individuals at banks who got money funneled to them from AIG.

Here's the link to their article:
http://pajamasmedia.com/blog/contributions-to-obama-campaign-track-bailout-money/

It's a major 'cover your as... (Below threshold)
GarandFan:

It's a major 'cover your ass mode'. Hey, let's approve legislation that no one has ever read. And let's get a 'really smart executive type' to sign it into law, having never taken the time to read it.

Wonder what else is going to come out of that bill later and jump up and down while yelling "SURPRISE, SURPRISE".

Hey, let's pass a health care, education and energy bill that no one has the time to read.
Best administration, evah!

I have another thought abou... (Below threshold)
Stan25:

I have another thought about this whole scam of the outrage over AIG. The Dems are pissed because they did not get their share of the bonuses. If they had gotten a kickback, they would not be screaming like a wounded pipe organ. I'll bet that if those people that got those bonuses would offer a nice sum for a campaign contribution, this whole thing would go away and would be forgotten in the morass of the "Messiah" Administration's incompetance.

Listening to Rush lately I ... (Below threshold)
MichaelC:

Listening to Rush lately I have come to see that all this sound and fury over a relatively small sum (in relation to the billions and billions.....) is really Obama and his cabal performing the old magician's trick of misdirection.

While doing everything possible to point everyone toward this debacle, what skulduggery is the man behind the curtain really up to.? And can we get people pointed in the direction of the real move being made by the administration before we discover that we have been had? Again.

Hmm, so Democrats got more ... (Below threshold)
Brian:

Hmm, so Democrats got more money than Republicans from AIG employees in 2008 (after receiving near equal amounts in previous cycles), and somehow that's responsible for Bush and Bernanke bailing them out in 2008.

In addition, Democrats are therefore so beholden to AIG employees, that Dodd (the largest recipient of AIG employee money) inserted language into the bill to nullify their bonuses, and since that was watered down Obama now wants to find other ways to reclaim the bonuses.

Interesting theories.

"It's quite interesting tha... (Below threshold)
Bruce Henry:

"It's quite interesting that Timothy Githner is not being mentioned at all...."

What channels you been watching, TOhio? The Fishing Channel? The Golf Channel?

Because I've heard him mentioned about once every 10 minutes for days, on TV and radio, as well as the net.

Sorry to ruin your perfectly good whine about the "Liberal Media."

bh - "Sorry to ruin you... (Below threshold)
marc:

bh - "Sorry to ruin your perfectly good whine about the "Liberal Media."

Funny, I failed to see any ref to the so-called Liberal Media in that comment, maybe you can help me out and quote that part. You wouldn't by-chance be assuming something that's far from the truth would you?

I did see a ref to a NYT article, but it hardly can be classified as a whine about anything, much less the Liberal Media.

Bruce HenryIf Your... (Below threshold)
914:

Bruce Henry

If Your going to come across as an Idiot please continue to do so.

I found the New York Times ... (Below threshold)
TOhio:

I found the New York Times (liberal newspaper) article that Sean Hannity mentioned on his radio show yesterday about Timothy Geithner's deep involvement in the AIG bailout.

This is a key excerpt from the article dated November 25, 2008 titled "Where Was Geithner in Turmoil?"

Behind the scenes, Mr. Geithner was the point person for weeks of sleep-deprived Bailout Weekends. It was Mr. Geithner, not Mr. Paulson, for example, who put together the original rescue plan for the American International Group.

"He was in the room at every turn of the crisis," said another executive who participated in several such confidential meetings with Mr. Geithner. "You can look at that both ways."

The article also mentions that Geithner was deeply involved with the fall of Lehman Bros.

Obama is protecting Geithner. Why?

The Democrats should be investigating themselves.

The Democrats shou... (Below threshold)
Stan25:
The Democrats should be investigating themselves.

Like that is gonna happen anytime soon. They are doing their best to blame George Bush for everything.

The AP is reporting: <block... (Below threshold)
kevino:

The AP is reporting:

Fannie Mae plans to pay retention bonuses of as much as $611,000 each to key executives this year as part of a plan to keep hundreds of employees from leaving the government-controlled company. Rival mortgage finance company Freddie Mac is planning similar awards, but has not yet reported on which executives will benefit.

And even more <a href="http... (Below threshold)
marc:

And even more via AP:

While administration officials insisted Tuesday that neither Obama nor Geithner learned of the impending bonus payments until last week, the problem wasn't new. AIG's plans to pay hundreds of millions of dollars were publicized last fall, when Congress started asking questions about expensive junkets the company had sponsored.

A November SEC filing by the company details more than $469 million in "retention payments" to keep prized employees.
Back then, Rep. Elijah E. Cummings, D-Md., began pumping Liddy for information on the bonuses and pressing him to scale them back.
"There was outrage brewing already," Cummings said. "I'm saying (to Liddy), 'Be a good citizen. ... Do something about this.' "
Around the same time, outside lawyers hired by the Federal Reserve started reviewing the bonuses as part of a broader look at retention and compensation plans, according to government officials who spoke on condition of anonymity. The outside attorneys examined the possibility of making changes to the company plans -- scaling them back, delaying them or rescinding them. They ultimately concluded that even if AIG's bonuses were withheld, the company would probably be sued successfully by its employees and be forced to pay them, the officials said.
In January, Reps. Joseph E. Crowley of New York and Paul E. Kanjorski of Pennsylvania wrote to the Federal Reserve and the Treasury Department pressing the administration to scrutinize AIG's bonus plans and take steps against excessive payments.
"I at that point realized that we were going to have a backlash with regard to these bonuses," Kanjorski said in an AP interview. In a meeting with Liddy later that month, he said he told the AIG chief that "all hell would break loose if we didn't find a way to inform the public ... and that we should take every step to put that information out there so we wouldn't have the shock."
If that isn't proof the Treasury Secretary's 15 minutes of infamy are up I fail to see when it would be.

The tax cheat needs to go, but he won't, 'cause ya know... obama thinks he's the only one in the entire world that can "handle" the job.




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