Wednesday, March 18, 2009

Another Word On The AIG Bonuses

You, me, and every other American don't own any part of AIG, despite the rhetoric by some folks that we own 80% of the company. For all the money we've spent as taxpayers we probably should own that much, if not more, but the government did not buy up shares of AIG, the government did not loan the company money, nor did they nationalize the company in lieu of bankruptcy. No, what the government did is write a blank check, a blank check that everyone is quite rightfully pissed off about. Well, everyone that is except the politicians who voted for the bailout bill in the first place. They signed off on a blank check, so what right do they have to be pissed about how AIG spent it? We talk about government serving the role of mother and father, but this has taken things one step further, with the government in the role of grandparent writing a big check for their grand kids birthday. If Grandma wanted them to be careful and save that money, she should have gotten them a savings bond. Don't get upset when the grandkids go and spend all that money on comic books.

I hope what people are coming to realize is you can't keep a big company afloat while punishing those executives who helped to ruin the company in the first place. This is the brilliance of the market, where you don't need the government to punish the executives who've fucked up. If the market was allowed to function, the company would go bankrupt and the executives wouldn't have any jobs or any bonuses. But this is what happens when the government steps in to support a failing company, you wind up execs spending taxpayer money in ways that taxpayers don't like and the government bumbling around feigning outrage and making excuses for why this has happened. Politicians can talk about conditioning bailout funds all they like, but the truth is, once you get into the business of telling a company what it can and can not do with it's money, you might as well just be running the thing in the first place.


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