The first names of AIG executives who received millions in bonuses have been released. Some executives are now suggesting that the company should pay for private security — which would presumably come from public funds. These executives include , labeled “Jackpot Jimmy by New York newspapers. He is James Haas, 47, an executive VP and the co-leader of North American marketing. Also named are Douglas Poling, 48, the unit’s general counsel, as well as a director, executive vice president and chief administrative officer, and Jonathan Liebergall, 43, a unit director and head of municipal finance.
Poling received the largest bonus check of $6.4 million. Poling has said that he intends to return the money, but it may not due much for his reputation. This is an outrageous amount of money and only appeared to produce regret when he was named in New York tabloids.
Haas has also said that he intends to “rescind my retention contract.”
One executive told The New York Times that “It is as bad if not worse than McCarthyism” and that AIG executives are being sacrificed by politicians “for their own political agenda.”
First, the people ruined by McCarthy were fighting for their right to work. They were also innocent. They were not fighting to rip off the public treasury after running a major corporation into the ground through incompetence and greed.
Second, the executive is right that these AIG employees do not deserve the focus of public anger. That should be directed as members of Congress who showed no responsibility or rationality in crafting the largest federal bailout in history. Members knew of these bonuses and put exemptions into the law to protect them. While Rep. Barney Frank says that they had no choice, I strongly disagree. I can think of a number of ways to have crafted the legislation to avoid this problem. Members simply did not care much about these details until the public exploded in anger.
As for President Obama’s insistence the he willing to take the blame, there should be some accountability for this scandal. Senator Chris Dodd of Connecticut, the Banking Committee chairman, and Treasury Secretary Timothy Geithner appear to blame each other. The fact is that Dodd put the amendment into the law. He should have refused if he opposed it. As for Geithner, if he is responsible for this exemption (which Obama has condemned), he should leave office.
This is another case where it seems that we have become a nation of chumps — allowing Congress to pretend that they are blameless and shocked by the language of their own legislation. It is not clear what it will take to get this country sufficiently angry to demand true structural reforms of our political system are needed.
As for reimbursement for private security, it seems unlikely that the public will support private security payments for executives made unpopular by their own actions in pilfering the treasury. The problem with taking massive public payouts is that payments and recipients can become public knowledge. However, these executives acted lawfully, though in my view greedily. It is Congress that betrayed the trust of the public in failing to impose the most obvious limitations on the use of hundreds of billions of dollars.
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