Comments on: Americans to AIG: Drop Dead http://politicalanimal.today.com/2009/03/25/americans-to-aig-drop-dead/ A Republic, If You Can Keep It Tue, 29 Dec 2009 00:56:10 +0000 http://www.today.com/version-2.3.1 By: rwahrens http://politicalanimal.today.com/2009/03/25/americans-to-aig-drop-dead/#comment-1415 rwahrens Wed, 25 Mar 2009 12:32:38 +0000 http://politicalanimal.today.com/2009/03/25/americans-to-aig-drop-dead/#comment-1415 Oh, and if those laws had been properly constructed - the bonuses could have been nipped in the bud - if an otherwise legal and binding contract binds one partner to that contract to an illegal act, that contract, or that portion of it, is not legally enforceable. Had that first TARP bill made such bonuses illegal, they would not have been able to have been paid, and the contracts would have to have been renegotiated with new conditions to meet the law. Oh, and if those laws had been properly constructed - the bonuses could have been nipped in the bud - if an otherwise legal and binding contract binds one partner to that contract to an illegal act, that contract, or that portion of it, is not legally enforceable. Had that first TARP bill made such bonuses illegal, they would not have been able to have been paid, and the contracts would have to have been renegotiated with new conditions to meet the law.

]]> By: rwahrens http://politicalanimal.today.com/2009/03/25/americans-to-aig-drop-dead/#comment-1414 rwahrens Wed, 25 Mar 2009 12:26:25 +0000 http://politicalanimal.today.com/2009/03/25/americans-to-aig-drop-dead/#comment-1414 Don't confuse the bailout money with the bonuses. The bonuses were awarded on the basis of the past Wall Street practice that makes the bonus a regular part of an employee's salary. Not a wise business practice, and most Americans are aware of this. It does not either reward or punish bad behavior, but is looked at by the employee as an entitlement - something that needs to change. But the bailout money is not really a bailout, or free money - the government has essentially bought shares in these companies - we OWN them, in other words, and this money will have to be paid back - assuming the firms don't fail and go bankrupt. It is NOT "free money" - the government's money never is - there are almost always onerous conditions, control being one of them - that come along with accepting it. In the case of the first wave of TARP money, the bill was enacted so fast that nobody really sat down and thought the conditions through, and there were several elements - bonuses and executive compensation being just two of them - that were left off. Obviously, that won't happen again. Don’t confuse the bailout money with the bonuses.

The bonuses were awarded on the basis of the past Wall Street practice that makes the bonus a regular part of an employee’s salary. Not a wise business practice, and most Americans are aware of this. It does not either reward or punish bad behavior, but is looked at by the employee as an entitlement - something that needs to change.

But the bailout money is not really a bailout, or free money - the government has essentially bought shares in these companies - we OWN them, in other words, and this money will have to be paid back - assuming the firms don’t fail and go bankrupt. It is NOT “free money” - the government’s money never is - there are almost always onerous conditions, control being one of them - that come along with accepting it.

In the case of the first wave of TARP money, the bill was enacted so fast that nobody really sat down and thought the conditions through, and there were several elements - bonuses and executive compensation being just two of them - that were left off.

Obviously, that won’t happen again.

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