Two Different Worlds

This week, Jon Stewart proved himself to be the best financial reporter in broadcasting, with his jab-by-jab knockout of CNBC's clueless Jim Cramer. If you missed it, you owe it to yourself to pay a visit to YouTube or Hulu to see the evisceration. What it proved, beyond a doubt, is the fact that the rapacious preeners of Wall Street--including their media apologists--live in entirely different world, with an entirely different world view, than the rest of us.

Incredibly, now there is fresh evidence, courtesy of reporting in the Washington Post. AIG, the company that was deemed 'too big to fail', is failing us once again. A new wave of executive bonuses, to the tune of $100 million, is being awarded, with no word of approval or assent from the group that holds an 80% stake in the company--namely, you, me and the rest of the U.S. taxpayers.

In attempts to explain this away, the current CEO of AIG said that he really had no choice, since the bonuses were contractual, and in any case, "we cannot attract and retain the best and brightest talent to lead and staff the AIG businesses...if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury."

This is so insane, it's almost impossible to know where to begin, but let's take a stab:

• First of all, if the bonuses are already contracted, they aren't really bonuses, are they? They are part of contractual compensation. They are not awarded on the basis of merit (as if there were any left in that company)
• Second, the stated threat is that these employees might sue. Well, there's an easy solution to that. Simply pull the government funding, let the company fail, and see what's left to win in the lawsuits. It's like trying to retrieve your best suit from the dry cleaners that just burned to the ground
• Finally, and most importantly, consider that 'best and brightest' shibboleth. The people being paid these bonuses are exactly the same people who leaped headlong into the derivatives schemes in the first place. They are the ones who brought AIG to its knees. They are the ones who undid all the honorable work being done by the people who conducted the company's historic business, namely insuring people (ironic, is that not?).
  

Thus, the question must be asked: why in the world would we, the AIG owners, even consider retaining these people instead of throwing them to the curb--or better yet, into a cell. If necessary, we should be paying to get rid of them, not keep them!

There is only one possible positive outcome: if this keeps John Stewart pissed off and on point, there may yet be some remedy to this madness.