WASHINGTON (AP) -- Rep. Barney Frank charged Monday that a decision by financially strapped insurance giant AIG to pay millions in executive bonuses amounts to "rewarding incompetence."
Echoing outrage expressed on both sides of the political aisle in the wake of revelations that American International Group will pay roughly $165 million in bonuses, Frank said he believes it's time to shake up the company.
"These people may have a right to their bonuses. They don't have a right to their jobs forever," said Frank, a Massachusetts Democrat who is chairman of the House Financial Services Committee.
The federal government shouldn't be dictating compensation or bonuses for anybody but themselves. That's a function of stockholders and compensation boards. That said, neither does the federal government have any, any business using taxpayer money to prop up failing companies in the first place....PERIOD!!!
But since the taxpayers own 80% of AIG, (i.e., we are the majority stockholders now) and many of us are losing our jobs, should they be doling out hundreds of millions in bonuses? Bonuses for what exactly? This company would be in ruin but for the taxpayers. What have these guys done to deserve bonuses? Bonuses are awarded for being highly successful, not miserable failures. I heard this weekend that at the end of 2008, when AIG knew they would be getting a huge bailout of cash, they quickly and secretly re-wrote their executive compensation contracts so several thousand of them could collect millions in bonuses that they would have otherwise lost. Barney Frank is right on this one.
The stupid argument for allowing the bonuses and unrestricted compensation packages is so the best and brightest financial minds will stay in US companies rather than go overseas to work for European banks which have no such restrictions. Best and brightest? Are you kidding me? These idiots knowingly bankrupted their companies while enriching themselves. I don't give a damn if they go to Europe. Let 'em. If Europe wants our incompetent executives, they can have them.
Bottom line: if you are too stupid to be successful on your own and you take money out of taxpayers' pockets, you must accept regulation, transparency, and reasonable limits on compensation. If that's unacceptable, then quit and move to Europe. We don't want you anyway.