• News
  • Celebrities
  • Finance
  • Crypto
  • Travel
  • Entertainment
  • Health
  • Others

The Peculiar Ethics of AIG Employees and Their Bonuses

Andrew Ross Sorkin takes a shot at explaining why we have to pay those AIG bonuses today in The New York Times. Sorkin explains that he knows it’s not a popular view to even try to justify the bonuses — but it’s the new reality of how the business world works in post-bailout America.

And it’s all far worse than you might think.

Sorkin offers an answer to a question I’ve been asking for a while: Who wants to hire those supposed AIG financial geniuses? They brought one of the world’s largest insurance firms to its knees and put the entire economy at risk.

Well, guess who does want them — and apparently is even fighting for their services?

It’s the companies that want to bet on AIG’s demise, using the expertise of the former employees who put together its house of cards in the first place. From Sorkin:

A.I.G. built this bomb, and it may be the only outfit that really knows how to defuse it.

A.I.G. employees concocted complex derivatives that then wormed their way through the global financial system. If they leave — the buzz on Wall Street is that some have, and more are ready to — they might simply turn around and trade against A.I.G.’s book. Why not? They know how bad it is. They built it.

So as unpalatable as it seems, taxpayers need to keep some of these brainiacs in their seats, if only to prevent them from turning against the company. In the end, we may actually be better off if they can figure out how to unwind these tricky investments.

Let’s see if I understand this: We have to pay to keep in place the people who put together ruinous financial deals, only because they are the only ones who understand how to unwind them – and they’ll take that information and use it against their former company, and American taxpayers, if they don’t get their millions in bonuses.

This goes far beyond the pale. If the government can’t act because of the sanctity of compensation contracts — I still don’t fully buy this explanation, but that’s for another day — there are still things the rest of us can do.

Let the sun shine in. Fire up the FOIA requests. Support New York Attorney General Andrew Cuomo as he goes after the names of those getting the bonuses. I talked about this on Monday — let the friends and neighbors of those holding AIG and the American taxpayers hostage with their bonus demands know exactly who they are.

I guess Wall Street must have operated this way for years — take what you can for yourself, screw over the company you left behind, get a pat on the back for your cleverness — but things are different now. We’re in a crisis that is increasingly draining away public funds that could go to other uses, and we all have the right to know what’s going on with our money, and who is benefiting from it — especially for personal gain rather than the public good. And if it’s true that AIG employees want to go elsewhere and use their knowledge to tank the company if they don’t get their money, then let them stand up and admit it. I’m not talking about vigilantism. Just the more powerful weapon of public shame, like what happened in Houston after Enron fell. Maybe it won’t be so socially acceptable to strut your ability to rip off your former employer and your country anymore.

And going forward, the Obama administration must put a stop to this. Non-compete clauses are common in the corporate world. Take a bonus from AIG in its inevitable next round of bailout funds, and sign on the dotted line that if you leave the company you won’t use your knowledge to work for its demise. AIG financial products employees should probably sign such a clause regardless of whether they receive a bonus, because it’s the right thing to do.

If anything good comes out of this financial crisis, maybe it will be the return of shame. Don’t count on it, though. Wall Street’s probably already gearing up to fight off financial reform. We should be smarter about this, moving forward. Follow the money that gets spent by the financial industry to fend off new rules and regulations. Stop letting firms that taxpayers are keeping afloat make all the decisions behind closed doors. Make compensation and bonuses an open book. The lesson from this AIG mess isn’t just about derivatives and credit default swps. It’s much simpler: Don’t allow the public to get blindsided again.

Discussion & Comments (0)

    Recent Articles

    • Things You Should Know about North America

      Things You Should Know about North America

      Get to know more about North America.

    • Eurovision 2010 Paula Seling Unpredictable Contest

      Eurovision 2010 Paula Seling Unpredictable Contest

      Paula Seling's experience on the Eurovision stage led her to declare that "Eurovision is an unpredictable contest". Which may explain the success of the young Lena from Germany, about whom the predictions before the event did not offer much chances for victory.

    • VIPRow.me - The Best Sports Streaming Website Today

      VIPRow.me - The Best Sports Streaming Website Today

      Have you ever contemplated creating a user-friendly site dedicated to sports-related free live streaming channels?

    • Learn How To Download, Install, And Use The Xnxubd 2022 Frame App

      Learn How To Download, Install, And Use The Xnxubd 2022 Frame App

      XNXUBD 2022 Nvidia users are able to watch thousands of videos and other contents online. XNXUBD 2022 Nvidia New is a piece of software that enables people to watch videos online without having to pay for memberships. On a graphics card, the XNXubd also provides some of the best gaming and virtual reality experiences.

    • Xvideostudio Video Editor Apk Free Download For Pc Full Version In 2022

      Xvideostudio Video Editor Apk Free Download For Pc Full Version In 2022

      A new edition of the Video Editor Apk for xVideostudio.Video Studio has all the latest features, including support for multiple video download formats in HD, FHD, and even 4K resolutions.

    • 9 Best Lotion For Masturbation - Popular Choice For 2022

      9 Best Lotion For Masturbation - Popular Choice For 2022

      Masturbation is a common activity for men and women. It's a natural and risk-free way to explore your body, experience pleasure, and release sexual tension.

    • Reasons Why You Need To Stop Watching Movies From Sflix

      Reasons Why You Need To Stop Watching Movies From Sflix

      Without having to sign up or pay anything, you can watch movies online for free with SFlix. It has more than 10,000 movies and television shows.

    • Coi Leray Mom And Dad's Family History & Wife, Explained

      Coi Leray Mom And Dad's Family History & Wife, Explained

      Coi Leray Collins (born May 11, 1997) is a rapper from the United States. Leray started publishing songs to SoundCloud in 2014, and in 2018 she released her breakthrough track "Huddy" as well as her first mixtape, Everythingcoz.

    • Listen And Download Music On MyFreeMP3 For Free

      Listen And Download Music On MyFreeMP3 For Free

      Are you in a bind and looking for a place to obtain free mp3 songs? Never again will you need to bother, since this article has everything necessary to obtain your solution. Download free music from MyfreeMP3.com, one of the world's most popular websites.