Stop Blaming AIG
In the past couple of days politicians have been loudly criticizing AIG for paying the bonuses. Yet they are the ones who gave AIG the bailout money with no safeguards or restrictions. If they are looking for someone to blame, all they have to do is look in the mirror.
The good news is that some congressmen are starting to talk like owners. Since the US, in effect, owns 80% of AIG we can start calling the shots and we should. Cutting off the money is not a good idea. Nor is firing the CEO. It's time to put in place the reporting requirements that should have been part of TARP in the first place.
President Obama has announced plans to put federal regulations in place to govern the insurance industry (AIG is an insurance company) similar to those governing financial institutions like banks. Those regulations will be stricter than before and will be enforceable. That's a good step, but it doesn't get to the root of the problem - greed.
We currently have a tax system in place that not only allows individuals to strip huge sums of money from companies and their stakeholders, it actually encourages it. Since any income over $373,000 is taxed at 35%, the highest tax bracket, there is no incentive whatsoever for any individual to not try and get as much income as he/she possibly can, regardless of the consequences.
So let's stop deferring to Wall Street. It's time for the government to step up and do its job of making sure that the rules we play by are fair for all, not just for a few. Put restrictions on past and future government aid to these companies, sure. Continue to make loans to fix the economic mess, sure. But fix the underlying problem - regulate marketplaces and tax away the incentives for greed.
Read Stop Blaming AIG for the full story.
I believe those that loot are right to be held responsible for their actions. It is not the fault of international aid donors that Mobutu Sese Seko looted the money meant to help starving people. It is not the fault of government that they don’t manage to outlaw and then enforce those those laws against all unethical and immoral behavior.
Yes, government is partially responsible for not policing corrupt dictators better. And yes government is partially responsible for not enforcing laws in support of regulated markets that capitalism requires (regulating negative externalities like systemic risk, exploiting monopoly profits, pollution…).
But much more responsible for encourage the moral and ethical failures of our “leaders” are those “leading” citizens sitting on corporate boards and approving the looting. And those that encourage the looting by including the looters in their high society in ways that they probably would not include Mobutu Sese Seko (though honestly their behavior makes that highly questionable – maybe they would include him). I image those that welcome the looters would not support those using child labor in factories (even if say that was not illegal in some country in which they exploited the laws for their benefit). Yet they want to be forgiven for welcoming looters since well all their buddies at the exclusive country club loot. Sorry that doesn’t excuse their immoral behavior and we should make it any easier for them to excuse themselves for their encouragement of such unethical behavior.
John
You seem to have forgotten one thing. When we lose anything, we always look for a scapegoat. Long time back it was Enron. We lost plenty. In fact, many committed suicide and left the houses without telling the loved ones. Now in the desperate times AIG comes up with the new president and new laws that are not yet ripe to take anyone to court. So, who suffers? We. In addition, where do we pour our grievances? To the big fat cats. AIG this time.
It is very natural to read little on reading and more on the viewing, TV here. It makes things easy for the eyes as we lose plenty somewhere else too.
Mistakes Managers make. After you’ve read the list, if you think I missed something, add it at the bottom of the article as an 11th item. We lose don’t we? Who is interested in what the managers err. We want know how much do we lose.
The winner I read from the press is the TAXPAYERS.
Barack Obama appeals to the ‘good guys’ of Wall Street in $1 trillion rescue
Barack Obama’s Administration will announce its latest economic rescue plan today by offering private investors vast government-backed loans to buy as much as $1 trillion of toxic assets from America’s stricken banks. The banks cannot pay anything except what the public can give. The public has little.
At last OBAMA is changing the tune by pleading the good and the bad to pay for the wars that were never there.
I thank you
Firozali A.Mulla
I think the AIG guys should keep the bonus’s.
What will they do with the money?
1. put it in the bank. Gives the bank money
to lend.
2. put it in the market. Gives companies money
to work with.
3. buy a new car or boat. Might help a salesman
keep his job.
4. goto Las Vegas and blow it all. Good for Vegas’
struggling economy.
All these are better than giving the money to the
government where it will just disappear.
edincalif@ca.rr.com