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Executive Bonuses Taxed?

Should the government tax bonuses paid to executives of bailed-out companies?

  • Total voters
    19
Slippery Slope said:
I have no problem admitting when I'm wrong, regardless of who is right. You're simply projecting.
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And then, your admission will follow soon, I am sure.
 
Reverend_Hellh0und said:
No, Dodd put the protection for the bonus in there, they gave AIG money they should not have. Now they are contractually obligated and a punitive tax to get it back is UNCONSTITUTIONAL
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This is pretty much exactly the situation. We shouldn't have given that money out. **** AIG, that place is falling apart. All we're doing now is wasting money till we have the fire sale; we should have done that before. It's something government could have done from the beginning. Take over the company, chop it up, sell off the parts which still have value and trash the rest. Plus AIG had to have committed fraud here, they claimed to be able to cover things it turns out they had no hope of covering; some of those people should be in jail for fraud. Regardless, I don't think it is rightful to use taxes to get back money we gave to them when the problem isn't so much on the company in this specific case (we gave them a bunch of money, they took it and gave it to themselves...duh); the real problem is the incompetency of our government...Congress and Executive. We have a much bigger failing that AIG, and it's our government.
 
So . . .

What other groups do we want to impose special taxes on just because we (the party in power) decide we don't like the way they spend government money? Or for any other reason, for that matter?

Those of you in favor of this abomination, answer the question. If this happens, what's to stop it from happening to anyone, any time, for any reason a majority party/President decide to do it?

How about putting a 99% tax rate on abortion providers who accept federal funds?
 
No comments, eh? People are OK with putting arbitrary punitive taxes on the politically unpopular?
 
There was a time when this could have been prevented, legally and morally. We missed that opportunity because the Congress wasn't content using our money to merely rescue the irresponsible corporation from the consequences of its own behavior-- they changed their bailout bill to support these bonuses because welfare is only wrong when it's given to poor people.

They got caught with their hands in the cookie jar and now they're scrambling to create the appearance that they're at least remotely interested in serving our interests.
 
dclxvinoise said:
We shouldn't have bailed these companies out in the first place. It puts our government in a very strange position of trying to control what corporations do when it is none of their business.
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Corporations cannot give million dollar bonuses to their executives with taxpayer money.

It is inherently dishonest and completely fraudulent.
 
Vader said:
Corporations cannot give million dollar bonuses to their executives with taxpayer money.

It is inherently dishonest and completely fraudulent.
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Once the government gave it to a private company, it is no longer taxpayer money. If they didn't put conditions on it before handing it over, the company is free to spend it any way they like. That said, the US government owns 69.9% of AIG. The US government installed Liddy, the CEO, and the BOD. Their boys are running the company. President Teleprompter and his administration can tell the company to do whatever they want them to do.

What amazes me is how everyone is all up in arms over the one hunder sixty-five million in bonuses but no one seems to care about the rest of the one eighty billion.
 
Ikari said:
This is pretty much exactly the situation. We shouldn't have given that money out. **** AIG, that place is falling apart.
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On a non-segmented view, yes that would be correct. However, when you break down FS from Insurance, the situation looks vastly different. AIG insurance is doing not bad, enough to survive if it was its own company. It's FS department is what is killing it.

All we're doing now is wasting money till we have the fire sale; we should have done that before.
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You do realize the implications of a fire sale on an insurance/derivatives firm no?

Take over the company, chop it up, sell off the parts which still have value and trash the rest.
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That's different from a fire sale. We should slowly break up AIG selling its parts to the highest bidder in a non-fire sale. Furthermore, if we can get somehow dispose of our share in the FS portion and retain the insurance, the Fed stands to make huge sums of money in the future the same way it did when it divested of Chrysler back in the day.

Plus AIG had to have committed fraud here, they claimed to be able to cover things it turns out they had no hope of covering
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What makes you think they didn't think they couldn't cover? No firm thinks it can cover all of its CDS, lines of credit or other off balance sheet liabilities all at once. They all assume a percentage. Banks have done this since the 30s. It didn't seem entirely unreasonable for AIG to assume that only a small portion of its CDS would actually come due.
 
obvious Child said:
On a non-segmented view, yes that would be correct. However, when you break down FS from Insurance, the situation looks vastly different. AIG insurance is doing not bad, enough to survive if it was its own company. It's FS department is what is killing it.



You do realize the implications of a fire sale on an insurance/derivatives firm no?



That's different from a fire sale. We should slowly break up AIG selling its parts to the highest bidder in a non-fire sale. Furthermore, if we can get somehow dispose of our share in the FS portion and retain the insurance, the Fed stands to make huge sums of money in the future the same way it did when it divested of Chrysler back in the day.



What makes you think they didn't think they couldn't cover? No firm thinks it can cover all of its CDS, lines of credit or other off balance sheet liabilities all at once. They all assume a percentage. Banks have done this since the 30s. It didn't seem entirely unreasonable for AIG to assume that only a small portion of its CDS would actually come due.
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Quit defending corporate fraud.
 
obvious Child said:
Estimating risk as a percent of liabilities being demanded at any one time is an extremely old practice in the banking and financial world. Sure AIG got greedy, but it doesn't seem like they committed fraud.
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A moderate response. I like this. Now I am willing to discuss the issue and do some additional research.

I still believe AIG made a serious error when it payed out million dollar bonuses with money given to them to loan bail them out.

I find this company's conduct reprehensible.
 
Vader said:
I still believe AIG made a serious error when it payed out million dollar bonuses with money given to them to loan bail them out.
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As other user pointed out, AIG actually has revenue, sizable amounts from its insurance. The $2.8 billion loss on realized net capital losses is somewhat of a paper loss. Take that out and AIG's insurance is making money. Money that can be used to pay for such bonuses.

http://investing.businessweek.com/r...cFormat=HTM&formType=10-K#Y74794E10VK_HTM_110
 
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