I’m sure you saw my post last week wondering about the outrage in the AIG bonuses. That only touched on dollar amounts and the absurdity of the situation. I’d have liked to go into it further, but the truth is I don’t know a whole lot about it. However, the whole thing still feels like a witch hunt to me.
On Tuesday one of the company’s executive VP’s resigned and did so with a scathing letter that spells out his take on the whole thing and it was printed in the New York Times.
I’ll quote just a little that I feel sums it up:
I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.
…I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.
You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.
As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.
Yep. He’s right.
I don’t know. I just don’t buy the categorical sense of logic.
To me the analogy goes more like this… plumber works on pipes and begins to see some sparks from the faulty work of the electrician, perhaps even smells some smoke. He does nothing about it; He doesn’t leave the work he’s doing; He doesn’t object.
Then when the house burns down so badly that insurance coverage isn’t enough to recoup the damages and collections are taken around the community to help… the plumber still stands there with his hand out as if he wasn’t responsible for at least sounding the fire alarm.
I can’t argue with your thoughts about the reality check folks need about just how much money we’re talking about with the bonuses. It’s a drop in the bucket.
And hey, there’s way more I don’t know about this than I do.
But I can’t get past this stunt. This guy was a top executive in the company. Posting his resignation letter in the NY Times is a bad play. Crying victim is even more pathetic.
Normally I’d agree with you, but that’s what someone who is unfairly attacked is – a victim.
I don’t think they did anything wrong and I don’t think they should have to forfeit any of the money they earned.
“That’s probably why A.I.G. management assured us on three occasions during that month that the company would “live up to its commitment” to honor the contract guarantees.
That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts “distasteful.” ”
Yeah, I think this says it all.
When the foundation of a house is beginning to crumble and the support beams are slowing coming down one at a time, believing the guy who assures you that the floor you are standing on won’t be impacted doesn’t make you a victim, it makes you an asshole.
No, I get what your saying and I kinda agree from that angle.
But I mean the country, the media, the government – whoever the hell keeps complaining about these bonuses and trying to get the money back.
Like this guy, these people did nothing. The ones who did are long gone.
I do believe that for the most part these people are just loyal employees who didn’t do anything wrong. They’re just the ones left standing there whent he shit hit the fan.
Did they stand by and watch others cause problems or did they find out after the fact? Who knows? I think the implication is the latter.
Combine that with the idea that the amount of money we’re talking in the big picture is laughable and the whole thing just feels like more resentment towards anyone with money. How dare they? Let’s take their money and spread the wealth. Tough times call for tough measures…unless you’re on the receiving end of the spread-the-wealth lottery.
I just see it as a prefect little microcosm of an attitude that feels like it’s spreading on a much larger level.
I hear ya. I really do and I get where you’re coming from.
Person A does legitimate work that turns a profit for the organization. Person A deserves to be paid for that work. There’s really no arguing that point from a concrete perspective.
But…
Life isn’t fair. If you continue working for a private entity that fails so badly it has to be bailed out with government dollars to the tune of 180 billion dollars, you have to accept that you aren’t going to get paid what you deserve.
Just the same way creditors who hold debt for folks who file bankruptcy aren’t going to get paid. It sucks, but it’s the way it goes.
And you’re right; Whether they knew what was going on or not can’t be determined. I’m more inclined to believe that while they may not have known about the credit-default swapping, they more than likely had an idea the company was failing. Failures as big as AIG’s don’t happen in an instant.
Company loyalty may be admirable, but it doesn’t mean shit in the long run. He and the others are out of luck.
I’m irritated by this article, because to me it demonstrates a retaliation to the company for a personal hurt about being sold out. That makes it sound like whining to me. I would have been more impressed with a general letter to the editor geared only towards clearing his name with the facts.
But he wasn’t out of luck. He got paid. He played his hand correctly. He stuck it out and got his bonus.
But after he won, we collectively seemingly decided this game is going to have no winners.
You could argue that if the government didn’t bailout AIG that he’d have gotten nothing and liked it, but AIG is too big not to bail out and that’s part of the consideration in the approach to sticking around.
You’re right – life in general isn’t fair on it’s own. But it didn’t just go this way like AIG failed and you were in the wrong place at the wrong time. It was taken from him…and that’s what I have a problem with.
Dumb luck is one thing. A conscious effort to decide someone doesn’t deserve something is something totally different.
Are you telling me honestly that as you see the major corporation you work for going under to the point of a government intervention, that you wouldn’t have the suspicion that the promises being made to you (mainly for the sole purpose of getting you to stay on with the company) have a large chance of being bogus in the end?
He won, because no one outside of AIG cared or paid attention at the time. That’s the crime, really. If you didn’t care then, then you shouldn’t care now. But politics and public perception doesn’t work that way, unfortunately.
In all honesty I am a bit torn on the issue. I agree that the money was deserved according to the terms of the contract in place.
And I can even support that a true bailout means providing the means to carry on your business and paying your employees is part of that. In fact, now that I am part investor in the $180 billion investment, I would like to see them keep the folks on who can turn the business around again.
But I’m stuck on a couple of issues. When government dollars came into play, it seems to me that nothing beyond essential payroll should be paid to the employees.
These bonuses weren’t a part of essential payroll. In fact, they weren’t even performance bonuses. They were enticements to stay on (retention) at the company because AIG knows they aren’t going to entice new employees now.
Where I am not willing to let these folks off the hook is that they signed contracts that they couldn’t have possibly, in a reasonble mind, thought would never be challenged. The bonuses were essentially bribes to get them to stay on.
A smarter person, if for some reason they didn’t think they should run from AIG as fast as possible at that point, should have at least negotiated the bonuses into salary some how.
Otherwise, I think it only makes sense one would expect they wouldn’t be honored in the end.