Tuesday, March 17, 2009
Pay Up
Count it up, guys and girls. The American taxpayer subsidized $450,000,000 in bonuses for the executives responsible for the failure of AIG, I suppose, as a way of saying 'thanks' for playing such a central role in this financial mess. Thanks a buck-fifty from every man, woman, and child in the USofA. Have you coughed yours up yet? If you don't, those brilliant execs might get upset and threaten an early retirement or something. But we really need their smarts over there at AIG, and God knows they gotta pay for those primo wax jobs on those Bentleys. Make sure Grandma forks it over, k? Oh and tell her to just set aside a ten spot actually cuz I've got a feeling we're gonna be rewarding a few more companies' failures before this is all over. What? Her savings just evaporated cuz Wall Street gambled it away? Oh well, I'm sure your Dad can cover her. What's that? He just got laid off and is filing for chapter eleven because he can no longer afford those medical bills his insurer found a reason not to cover? Hmm, well I suppose you can borrow from your kids you haven't even had yet. Oh wait, does Social Security even exist anymore? Look here, my friends: these guys planned their Tahitian getaways long before they burned the house down. Let's all just call China and ask them for some dough. Oh, each of us owes them well over three grand already? Aw then they wont mind if we each borrow a quick twenty bucks more. We can toss half to make sure the rich stay rich and use the rest to celebrate over a box of Samoas.
Saturday, March 14, 2009
Bailouts for Bonuses
Why can't the US Government, upon agreement to hand AIG $170B, include in the contract that the US taxpayer will not subsidize executive bonuses? I mean, perhaps they were "contractually obligated" before they went flying off the cliff, but the only reason those bonuses can even be dscussed at this point is because we saved their asses. For that, we should have the power to say NO BONUSES FOR FAILURE, but we shouldn't even have to say it. This is disgusting.
WASHINGTON (AP) - American International Group is giving its executives tens of millions of dollars in new bonuses even though it received a taxpayer bailout of more than $170 billion dollars.
AIG is paying out the executive bonuses to meet a Sunday deadline, but the troubled insurance giant has agreed to administration requests to restrain future payments.
The Treasury Department determined that the government did not have the legal authority to block the current payments by the company. AIG declared earlier this month that it had suffered a loss of $61.7 billion for the fourth quarter of last year, the largest corporate loss in history.
Treasury Secretary Timothy Geithner has asked that the company scale back future bonus payments where legally possible, an administration official said Saturday.
This official, who spoke on condition of anonymity because of the sensitivity of the issue, said that Geithner had called AIG Chairman Edward Liddy on Wednesday to demand that Liddy renegotiate AIG's current bonus structure.
Geithner termed the current bonus structure unacceptable in view of the billions of dollars of taxpayer support the company is receiving, this official said.
In a letter to Geithner dated Saturday, Liddy informed Treasury that outside lawyers had informed the company that AIG had contractual obligations to make the bonus payments and could face lawsuits if it did not do so.
Liddy said in his letter that "quite frankly, AIG's hands are tied" although he said that in light of the company's current situation he found it "distasteful and difficult" to recommend going forward with the payments.
Liddy said the company had entered into the bonus agreements in early 2008 before AIG got into severe financial straits and was forced to obtain a government bailout last fall.
The large bulk of the payments at issue cover AIG Financial Products, the unit of the company that sold credit default swaps, the risky contracts that caused massive losses for the insurer.
A white paper prepared by the company says that AIG is contractually obligated to pay a total of about $165 million of previously awarded "retention pay" to employees in this unit by Sunday, March 15. The document says that another $55 million in retention pay has already been distributed to about 400 AIG Financial Products employees.
The company says in the paper it will work to reduce the amounts paid for 2009 and believes it can trim those payments by at least 30 percent.
Bonus programs at financial companies have come under harsh scrutiny after the government began loaning them billions of dollars to keep the institutions afloat. AIG is the largest recipient of government support in the current financial crisis.
AIG also pledged to Geithner that it would also restructure $9.6 million in bonuses scheduled to go a group that covers the top 50 executives. Liddy and six other executives have agreed to forgo bonuses.
The group of top executives getting bonuses will receive half of the $9.6 million now, with the average payment around $112,000.
This group will get another 25 percent on July 14 and the final 25 percent on September 15. But these payments will be contingent on the AIG board determining that the company is meeting the goals the government has set for dealing with the company's financial troubles.
The Obama administration has vowed to put in place reforms in the $700 billion financial rescue program in an effort to deal with growing public anger over how the program was operated during the Bush administration.
That anger has focused in part on payouts of millions of dollars in bonuses by financial firms getting taxpayer support.
In his letter, Liddy told Geithner, "We believe there will be considerably greater flexibility to reduce contractual payments in respect of 2009 and AIG intends to use its best efforts to do so."
But he also told Geithner that he felt it could be harmful to the company if the government continued to press for reductions in executive compensation.
"We cannot attract and retain the best and brightest talent to lead and staff the AIG businesses, which are now being operated principally on behalf of the American taxpayers - if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury," Liddy said.
WASHINGTON (AP) - American International Group is giving its executives tens of millions of dollars in new bonuses even though it received a taxpayer bailout of more than $170 billion dollars.
AIG is paying out the executive bonuses to meet a Sunday deadline, but the troubled insurance giant has agreed to administration requests to restrain future payments.
The Treasury Department determined that the government did not have the legal authority to block the current payments by the company. AIG declared earlier this month that it had suffered a loss of $61.7 billion for the fourth quarter of last year, the largest corporate loss in history.
Treasury Secretary Timothy Geithner has asked that the company scale back future bonus payments where legally possible, an administration official said Saturday.
This official, who spoke on condition of anonymity because of the sensitivity of the issue, said that Geithner had called AIG Chairman Edward Liddy on Wednesday to demand that Liddy renegotiate AIG's current bonus structure.
Geithner termed the current bonus structure unacceptable in view of the billions of dollars of taxpayer support the company is receiving, this official said.
In a letter to Geithner dated Saturday, Liddy informed Treasury that outside lawyers had informed the company that AIG had contractual obligations to make the bonus payments and could face lawsuits if it did not do so.
Liddy said in his letter that "quite frankly, AIG's hands are tied" although he said that in light of the company's current situation he found it "distasteful and difficult" to recommend going forward with the payments.
Liddy said the company had entered into the bonus agreements in early 2008 before AIG got into severe financial straits and was forced to obtain a government bailout last fall.
The large bulk of the payments at issue cover AIG Financial Products, the unit of the company that sold credit default swaps, the risky contracts that caused massive losses for the insurer.
A white paper prepared by the company says that AIG is contractually obligated to pay a total of about $165 million of previously awarded "retention pay" to employees in this unit by Sunday, March 15. The document says that another $55 million in retention pay has already been distributed to about 400 AIG Financial Products employees.
The company says in the paper it will work to reduce the amounts paid for 2009 and believes it can trim those payments by at least 30 percent.
Bonus programs at financial companies have come under harsh scrutiny after the government began loaning them billions of dollars to keep the institutions afloat. AIG is the largest recipient of government support in the current financial crisis.
AIG also pledged to Geithner that it would also restructure $9.6 million in bonuses scheduled to go a group that covers the top 50 executives. Liddy and six other executives have agreed to forgo bonuses.
The group of top executives getting bonuses will receive half of the $9.6 million now, with the average payment around $112,000.
This group will get another 25 percent on July 14 and the final 25 percent on September 15. But these payments will be contingent on the AIG board determining that the company is meeting the goals the government has set for dealing with the company's financial troubles.
The Obama administration has vowed to put in place reforms in the $700 billion financial rescue program in an effort to deal with growing public anger over how the program was operated during the Bush administration.
That anger has focused in part on payouts of millions of dollars in bonuses by financial firms getting taxpayer support.
In his letter, Liddy told Geithner, "We believe there will be considerably greater flexibility to reduce contractual payments in respect of 2009 and AIG intends to use its best efforts to do so."
But he also told Geithner that he felt it could be harmful to the company if the government continued to press for reductions in executive compensation.
"We cannot attract and retain the best and brightest talent to lead and staff the AIG businesses, which are now being operated principally on behalf of the American taxpayers - if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury," Liddy said.
Friday, March 13, 2009
Jon Stewart vs Jim Cramer
Here's the complete interview between Jon Stewart and Jim Cramer. VERY interesting.
Wednesday, March 11, 2009
An Audio Journey
Here's a fascinating audio interview I heard tonight on 'The Story', presented by National Public Radio and American Public Media, following this introduction copied directly from TheStory.org
About 10 years ago, William Lobdell was at a church retreat. He felt a warmth spreading in his chest and next he knew, he was raising his hand - he felt he had been saved. His faith gave him new purpose in life. After a couple of years as an evangelical Christian, he began taking steps to convert to Catholicism. Around the same time, he convinced his editors at the Los Angeles Times to allow him to become the paper's religion reporter.
At the beginning, the religion beat was a dream job. But as stories of clergy abuse and religious hypocrisy kept making the news, Bill found himself shaken, increasingly skeptical of both the church and its teachings. He began to question his own faith, and ultimately the existence of God.
Listen Now to the mp3 in a New Window
About 10 years ago, William Lobdell was at a church retreat. He felt a warmth spreading in his chest and next he knew, he was raising his hand - he felt he had been saved. His faith gave him new purpose in life. After a couple of years as an evangelical Christian, he began taking steps to convert to Catholicism. Around the same time, he convinced his editors at the Los Angeles Times to allow him to become the paper's religion reporter.
At the beginning, the religion beat was a dream job. But as stories of clergy abuse and religious hypocrisy kept making the news, Bill found himself shaken, increasingly skeptical of both the church and its teachings. He began to question his own faith, and ultimately the existence of God.
Listen Now to the mp3 in a New Window
The Coming Evangelical Collapse
Here's an excerpt from an article I came across yesterday on the Christian Science Monitor:
ONEIDA, KY. - We are on the verge – within 10 years – of a major collapse of evangelical Christianity. This breakdown will follow the deterioration of the mainline Protestant world and it will fundamentally alter the religious and cultural environment in the West.
Within two generations, evangelicalism will be a house deserted of half its occupants. (Between 25 and 35 percent of Americans today are Evangelicals.) In the "Protestant" 20th century, Evangelicals flourished. But they will soon be living in a very secular and religiously antagonistic 21st century.
This collapse will herald the arrival of an anti-Christian chapter of the post-Christian West. Intolerance of Christianity will rise to levels many of us have not believed possible in our lifetimes, and public policy will become hostile toward evangelical Christianity, seeing it as the opponent of the common good.
Millions of Evangelicals will quit. Thousands of ministries will end. Christian media will be reduced, if not eliminated. Many Christian schools will go into rapid decline. I'm convinced the grace and mission of God will reach to the ends of the earth. But the end of evangelicalism as we know it is close.
WHY IS THIS GOING TO HAPPEN?
1. Evangelicals have identified their movement with the culture war and with political conservatism. This will prove to be a very costly mistake. Evangelicals will increasingly be seen as a threat to cultural progress. Public leaders will consider us bad for America, bad for education, bad for children, and bad for society.
The evangelical investment in moral, social, and political issues has depleted our resources and exposed our weaknesses. Being against gay marriage and being rhetorically pro-life will not make up for the fact that massive majorities of Evangelicals can't articulate the Gospel with any coherence. We fell for the trap of believing in a cause more than a faith.
2. We Evangelicals have failed to pass on to our young people an orthodox form of faith that can take root and survive the secular onslaught. Ironically, the billions of dollars we've spent on youth ministers, Christian music, publishing, and media has produced a culture of young Christians who know next to nothing about their own faith except how they feel about it. Our young people have deep beliefs about the culture war, but do not know why they should obey scripture, the essentials of theology, or the experience of spiritual discipline and community. Coming generations of Christians are going to be monumentally ignorant and unprepared for culture-wide pressures.
3. There are three kinds of evangelical churches today: consumer-driven megachurches, dying churches, and new churches whose future is fragile. Denominations will shrink, even vanish, while fewer and fewer evangelical churches will survive and thrive.
4. Despite some very successful developments in the past 25 years, Christian education has not produced a product that can withstand the rising tide of secularism. Evangelicalism has used its educational system primarily to staff its own needs and talk to itself.
5. The confrontation between cultural secularism and the faith at the core of evangelical efforts to "do good" is rapidly approaching. We will soon see that the good Evangelicals want to do will be viewed as bad by so many, and much of that work will not be done. Look for ministries to take on a less and less distinctively Christian face in order to survive.
6. Even in areas where Evangelicals imagine themselves strong (like the Bible Belt), we will find a great inability to pass on to our children a vital evangelical confidence in the Bible and the importance of the faith.
7. The money will dry up.
Saturday, March 7, 2009
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