The government-appointed CEO of AIG, Edward Liddy was questioned today by US lawmakers who represent the furious tax-payers of America about staggering bonuses paid by the bailed-out insurer.
President Obama also made a special address to this specific issue where the Government appointed official failed to protect the interest of US Tax payers. The president’s words were, “Washington is all in a tizzy and everybody is pointing fingers at each other and saying it’s their fault, the Democrats’ fault, the Republicans’ fault,” at a town hall meeting today. He noted a strong personal attachment with, “Listen, I’ll take responsibility. I’m the President.”
Liddy said he had no legal choice over paying out the “distasteful” bonuses of 165 million dollars, but vowed that American International Group was learning from its mistakes after it was saved from bankruptcy last September. Edward Liddy accepted that “Mistakes were made at AIG on a scale few could have ever imagined possible,” at a packed hearing of the House subcommittee on capital markets, according to his prepared remarks.
Tresury secretory, Tim Geithner said late yesterday that he was demanding AIG repay the lavish bonuses it gave out last week, mainly to the very London-based traders who crippled the company and helped trigger the global financial crisis. President noted that “no body is working harder than this guy (secretory Geithner)”.
Edward Liddy announced at the hearing that he has asked AIG employees who received more than $100,000 in bonuses to return half of the amount, and for all higher-up executives receiving bonuses to return them in full.
White House officials had expected questions about AIG, given the furor over the $165 million in bonuses given to officials at the company, which has received $180 billion in government aid. There is discussion about taxing these by 90% to 100% to recoup the entire amounts of the bonuses paid.
Read/view a well covered report on this issue at PBS here
It is rather interesting that the hard time brings out the most evil in not only people, but also the society! Is this the end of capitalism and start of socialism? Where the government can engage in such behavior of punishing individuals after given the power it holds? Is it really fair for the government to not assume these losses and start such discussions? On the other hand, is it really fair for these individuals to abuse their contractual positions and take-away their bonuses, which were intended to reward their competence when used to help the company? Where do you draw the moral line?
