Posted by Frank Schubert at 12:00 am on Apr 01, 2009 Comments Off on My Weekly Rant: Bonuses, Bailouts and Business
The hue and cry over bonuses paid to AIG executives is both
predictable and understandable. This is what happens when a private
business allows the government to get into its knickers. But also
blame the federal government for this situation. AIG should have
been forced into bankruptcy, not been the recipient of $185 billion
in taxpayer bailouts.
Certainly AIG itself bears most of the blame for its current
plight for taking on risky bets on mortgage-backed securities. They
bet and lost, and should have gone bankrupt because of their failed
business decisions. But it was geniuses in the federal government,
including Barney Frank and Chris Dodd, who are responsible for the
anger that taxpayers feel over AIG. They decided that AIG was too
big to fail, so they showered them with billions of our tax
dollars.
Later when the firestorm of public protest erupted, Frank and
Dodd tried to run for cover. When the bailout legislation was being
crafted, Senator Dodd, acting on behalf of the Obama White House,
specifically inserted language allowing AIG to pay the millions in
bonuses that are now the subject of public… Read More