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Ear to the Ground

Geithner’s Bonus Plan as Perplexing as His Other Proposals

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Posted on Mar 17, 2009
Geithner image from Presidencia de la Nación Argentina

Treasury Secretary Timothy Geithner has sent Congress an explanation of his plan to deal with the AIG bonus fiasco. Essentially, Treasury will dock the $165 million in bonuses from AIG’s next bailout payment. Here’s a question: If AIG can do without that $165 million, why were we giving it to the company in the first place?

Isn’t the whole idea that this company is too big to fail and we have to hand over our hard-borrowed funny money or the world will implode?

BBC:

In a letter to congressmen, Timothy Geithner said $165m (£116m) would be taken from $30bn the firm is due to get as part of its government bail-out.

The plan comes after Mr Geithner faced heavy criticism for his handling of the increasingly controversial issue.

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By adamssam, March 18, 2009 at 4:03 pm Link to this comment

Graft and Corruption-

The American political class are ineffective to stave off the inequalities of capitalism! Our two party system and bi-cameral federal legislature is corrupt.  The disinterested and indifferent class to the body politic is in league with plutocrats: they’ve become kleptocrats. Posit the assumption that it’s not anti-American to resist tyranny. Our nation was founded on such egalitarian principles- even the republican conception of a democratic nation decried the Crown’s abuse of power. Our present day tyrannical despots are not monarchial, but rather insidiously inculcated in the political institutions themselves, promulgated by their pimps, PACs and corporate ideology of unbridled capitalism. The difference today is semantic: consider the polarities of Bourgeoise and Proletariat, and Democrat and Republican. Class and income are the new divisions of society. Not just the American Dream that is fading, so is the uniquely American Experiment.

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By Ribald, March 18, 2009 at 3:26 pm Link to this comment
(Unregistered commenter)

I’m just waiting for Geithner and his associates to start justifying their plans to the public with Bush-ian claims of “history will show that what we did was right.”

  Just like the reasons for invading Iraq, the rational for tossing money to the ones most responsible for our predicament will probably evolve with time. By the time we’re on the way out of the recession, they may still be getting billions, though in the name of economic incentives for them to comply with regulations. I can imagine it now: “If we don’t receive these funds, there is a high probability that our management will be unable to comply with the law, thereby threatening the world’s financial stability”

  Stranger things have happened.

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By mlb, March 18, 2009 at 2:50 pm Link to this comment

The confusing nature of Geithner’s proposals is easily explained, and it’s not because he’s stupid or lacking verbal skills.  It’s just an inevitable side effect of the fact that he’s attempting to allow his finance buddy crooks to continue to rape the world, without revealing what he’s up to.

The bonus money is a red herring, plumped up by feigned outrage from the politicians.  AIG has received $152 billion so far and recently demanded another $30 billion.  The bonuses are a mere 1/1000th of the money the criminals in Congress stole from American taxpayers and poured down the AIG black hole.  (That’s not to say that the AIG executives aren’t scum, but that should go without saying.  They are capitalists, after all. It would be naive to expect them to act any differently.)

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Eric L. Prentis's avatar

By Eric L. Prentis, March 18, 2009 at 10:49 am Link to this comment

Slimy Tim Geithner is a financial ruling class shill who will go to all lengths to save outrageous, undeserved bonuses for his crony AIG and Wall Street friends. Geithner’s shell game plan to dock AIG funds does nothing to stop the $165 million dollar employee bonuses, and we can be sure that AIG will be back for a fourth government bailout, plus an additional $165 million dollars on top of that. President Obama, where are you!

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By psickmind fraud, March 18, 2009 at 10:02 am Link to this comment

Louise, I would suggest a small step first.  Why don’t you call your Representative or Senator, and suggest that they stand up on the floor of the House or Senate, and demand that the members of their chamber return any contributions they have taken from failed financials.  If you can get them to do that, and their fellow Reps/Sens actually do return the campaign contributions, then maybe the rest of your plan will work.  Let me know when they make that demand.

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By Louise, March 18, 2009 at 9:36 am Link to this comment

Based on the assumption that some may actually read and understand, I suggest the following:

Obviously Mr. Geithner has never OWNED a corporation before. Otherwise he would have realized about the time we acquired 79.9% control as major shareholders in AIG, he could have stopped the bonuses. He didn’t realize, but then neither did WE.

Or anyone in CONGRESS!

So I think it falls to all of us to request CONGRESS get their act together and start managing OUR Corporation!

That would require several actions.

One, chop the bad arms off AIG, and dispose of them post haste.

Two, replace all CEO’s, managers, and heads of sales divisions that peddled financial products AKA Credit Default Swaps [CDS] as worthwhile investments.

Three, pass laws either eliminating Credit Default Swaps, or creating such strict regulations and controls on their use, that this can never happen again.

It helps to know New York attorney general, Andrew Cuomo is looking into accountability. But since Credit Default Swaps were totally unregulated, was the way they were used actually unlawful? And since AIG was only taking advantage of a stupid CONGRESS who deliberately removed the few controls on CDS back in 2000, who should really face prosecution?

Congress may be somewhat satisfied to think that money may come back. But whether coming or going, it doesn’t do squat to bring order to the whole AIG mess!

It’s really a little silly for Congress to rise and protest then fall back to silence, without actually taking control of AIG.

So maybe we need to demand Congress take a quick course on corporate management. Most of them don’t understand what that means, either.

Maybe that’s what we need to focus on.

Right after we educate ourselves, we need to educate Congress.

OK, I know. That’s a lot like saying we’re going to change the way the Sun sets, but it’s worth a try!

By the way. We CAN tell Congress what to do! Just as Congress CAN tell Geithner what to do! The trick is moving beyond the ass-backwards way we all react instead of taking action!

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By Shift, March 18, 2009 at 8:04 am Link to this comment

Remember, Obama is the decider.  It is Obama who chose this policy path.  The buck stops at the top.

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By reason, March 18, 2009 at 7:58 am Link to this comment

Is it possible we are so ignorant as to continue to believe the media tripe and allow ourselves to be manipulated by those who want to control what we believe to be the truth about the present economic conditions? Criticism of President Obama for “telling it like it is” is a “tried and true” method to rein in a President who was elected with a popular mandate to bring real and lasting change to our political, financial and social systems and hold those in charge responsible. Financial and corporate thieves claim and Obama is hurting the markets ability to rebound because he is too frank about conditions affecting the economy. At present, the real story is about who will define the solutions and take the appropriate action.
Facts are like statistics; and they are only as relevant as the person (s) gathering them wishes them to be. Those in charge of deciding the relevancy of the facts can and do influence popular opinion and in doing so, they influence what is believed to be the truth. Skewing the facts or “disinformation” has been a valuable tool of Wall Street and Washington insiders for years and they are not going to give up their power without a fight. Wall Street financiers and political insiders are loyal only to themselves and it is about time the rest of the country understands that fact.
Nixon, said, you’re not a crook until you are caught” and Clinton didn’t believe a “blow job” was having sex” and in their world of power and corruption it was and still is popular perception. Insiders know that manipulating the truth is a matter of deciding the parameters of the question (2+2=4 but it also equals 1, 2 and 3. Those who decide the parameters of the problems/questions decide what the solutions/answers will be.

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By Jim Yell, March 18, 2009 at 7:15 am Link to this comment
(Unregistered commenter)

Letting these creeps keep our tax dollars is a crime. This issue should have been dealt with before the money was given to these habitual criminals. Why would anyone think people capable of these crimes would be fair and balanced in the use of the taxpayers windfall payment to them without strings attached.

Investigate, charge and convict these bastards and recover all our money.

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William W. Wexler's avatar

By William W. Wexler, March 18, 2009 at 7:07 am Link to this comment

Please don’t shitcan Geithner.  He’s my rationale for cheating on my taxes.

-Wexler

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By greatdogs, March 18, 2009 at 6:58 am Link to this comment
(Unregistered commenter)

The actions of the administration and Congress in the AIG fiasco tell me they are either in on the deal, or completely clueless on how to deal with it. 

What about Senator Dodd and his “compensation amendment” in the original bailout bill?  Who is looking into this?  Wasn’t he one of the leading campaign recipients of AIG?  If so, could this not be construed as a quid pro quo?  Hello, Senate Ethics Committee, anybody home?  I heard that Dodd in his defense said the amendment was inserted in the House Senate conference on the bill.  OK, I’ll buy that, inserted by who?

The most pathetic part of this whole ordeal is the “outrage” expressed by everyone from Obama on down.  For cryin’ out loud, you guys are in charge, do something about the screw up. Your crediblity is now becoming subject to question.  As the original post states:  Here’s a question: If AIG can do without that $165 million, why were we giving it to the company in the first place?

Isn’t the whole idea that this company is too big to fail and we have to hand over our hard-borrowed funny money or the world will implode?

How much of the money given to AIG, Citi, and every other mismanaging bunch of pigmen was not necessary to begin with?  Why should we believe any doomsday scenario you come to us with in search of our support of your policies?

Mr President, I supported your election and that of the Democrats in the House and Senate.  You must get a handle on this and do so in short order. Your credibility is at stake. If there where shenanigans in these dealings, you must take action.  If you fail to address this problem with action rather than words, nothing else you do will matter.

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By Michaelc, March 18, 2009 at 6:35 am Link to this comment
(Unregistered commenter)

His solution does not really address the fact that the individuals who do not deserve it are getting to take home million dollar bonuses.
The fact that AIG will get less cash next time does not address the wasting of money on bonuses, in fact it may help insure that they will be back again.
In any case we have so little control how these banks/insurance/investment orgs handle their taxpayer sponsored windfall, that they could do anything with it and we would never know.

These guys created this mess, why do we trust them to get us out of it?

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Purple Girl's avatar

By Purple Girl, March 18, 2009 at 6:02 am Link to this comment

Freeze & Seize all Corp assets and Persoanl Assets. Begin Prosecution under RICO statues and for Economic Treason.They Destroyed the Economic solvancy of this country through embezzlement and money laundering then proceeded to extort further money from the American PEOPLE by essentially claiming the place would go up in flames if we didn’t.Calims o fthese ‘top’Capos that if they don’t get their bonuses they won’t work to untangle this disaster they created, is also an attempt to extort more money.
Imprison them on life sentences and put them in General Pop in the Worst prisons in the country. Let the Convicts have their way with them “My, you gotta purdy smile”. In fact make sure it’s one of those run by Profiteering Corps (ones they had on the Exchange?). Let them see the effects of ‘Cutting costs and increasing profit margins’ from a human perspective.Prison overpopulation - Guess that means the ‘Train’ has more ‘Choo Choos’ bringing up the back end.These Guys might reconsider the Japanese way to ‘save face’, or even beg for the way the Chinese ‘Terminate’ the contract with Bad employees.

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By kajsa, March 18, 2009 at 5:45 am Link to this comment

Come on, Mr. President, the majority voted for you, as did I.  How is taking out the bonus money going to hurt the $30 billion payment?  Even Congress had a better idea to tax the the guys instead (if it’s legal).  The remainder of the bailout money should not be paid until the stress tests are completed and the American people, not only Tim Geithner, sees what’s on their books.  Let us make decisions for once.

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By SteveK9, March 18, 2009 at 5:01 am Link to this comment

It’s obvious nonsense, intended purely for political effect.  I doubt it will work.

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By lester333, March 18, 2009 at 4:37 am Link to this comment

This simpleton bastard could not balance his checkbook, what the hell is going on herer!!!!!!  Why is the G** D*** M***** F***** running the Treasury Department.  I can tell you why!  He is a despicable plant.  Send him to jail.

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