Un ‘f*&#*ng’ believable.
Insurance giant AIG, which has received $170 billion in tax-payer funded bailout, is paying out over $700 hundred million in bonus and retention payments to its employees, according to the Washington Post.
The feeble excuse – AIG is contractually obligated to pay the money.
But U.S. courts have routinely thrown out contracts on pay and benefits for ordinary workers during difficult times for a corporation.
So, why didn’t the U.S. administration declare the contracts void.
We are beginning to lose faith in the Obama administration.
Here’s an excerpt from the Washington Post story:
Insurance giant American International Group will award hundreds of millions of dollars in employee bonuses and retention pay despite a confrontation Wednesday betweenÂ the firm’s chief executive and Treasury Secretary Timothy F. Geithner.Â
….About 4,700 people in the company’s global insurance units are receiving $600 million in retention pay. In addition, about $121 million in corporate bonuses will go to more than 6,400 people, for an average payout of about $19,000, according to AIG.
The New York Times is reporting that $100 million in bonus money will go to the folks in AIG Financial Products unit, which is at the ground zero of the company’s disaster:
Despite being bailed out with more than $170 billion from the Treasury and Federal Reserve, the American International Group is preparing to pay about $100 million in bonuses to executives in the same business unit that brought the company to the brink of collapse last year.
An official in the Obama administration said Saturday that Treasury Secretary Timothy F. Geithner had called A.I.G.â€™s government-appointed chairman, Edward M. Liddy, on Wednesday and asked that the company renegotiate the bonuses.
Administration officials said they had managed to reduce some of the bonuses but had allowed most of them to go forward after the companyâ€™s chief executive said A.I.G. was contractually obligated to pay them.