AIG To Give Executives "Retention Payments" Instead Of "Bonuses"
CBSNews says that AIG will be suspending "bonuses" for executives and will instead replace them with "retention payments." We're not entire sure what the difference is and the government doesn't know either.
CBS says:
On Wednesday, lawmakers grilled Assistant Treasury Secretary Neel Kashkari about AIG's bonus plan. Rep. Donald Manzullo, R-Ill., asked if a $3 million bonus was too much.
"It is excessive for a failing institution, yes," said Kashkari.
But so far, no one's stopping AIG from paying millions to some employees in its new retention program. The company has told 168 employees they'll receive between $92,500 and $4 million per individual if they stay with the company for one year. That angers some on Capitol Hill.
"These so-called retention payments are nothing less than bonuses," Rep. Elijah E. Cummings, D-Md., told CBS News. He sent letters to AIG, demanding details of the retention program.
Cummings went on to say that no one is indispensable when there are thousands of qualified people out of work on Wall Street. AIG responded that the payments were not "popular" but they were necessary to keep the business together so that they could eventually pay back taxpayers.
After Rescue, Bonuses Still Flow At AIG [CBSNews]
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Real quick, where are all of these qualified people at AIG going to go?
Look, these guys needs the tax funded "bonus." They're not like you and I, they're Bourgeoisie and deserve lavish lifestyles funded by commoners.
Its cool though, one day we'll chop their heads off and eat Brie.
@nataku83: If they're truly qualified, there are always jobs to be found.
I'm not saying they'd ALL leave, but if even a large number of key employees left, any company would be in trouble.
It looks like AIG is getting a headstart on the golden turd award for 2009. I guess they wanted to make sure they were in the running this time around.
only people who should get a bonus are the insurance end of AIG, they made money, the investment people got no where else to go anyway.
@nataku83: EXCELLENT point!
Hearing them talk about it you'd think that the financial sector was brimming with opportunity. I doubt half of these people could find a part time job at a Dunkin Donuts.
@InfiniTrent: Except in this case, the "qualified" people are the ones who screwed up the company in the first place.
@InfiniTrent: I've heard that logic before, and I somewhat understand it. Except I wonder, in an economy such as ours, does that explanation really hold water? Judging from the employment figures, I have a hard time believing that all the AIG employees are going to rush right out and find jobs elsewhere. Can you honestly tell me from a business standpoint, given the state of AIG, that any one employee can be worth 4 million in taxpayer money to keep around?
@InfiniTrent: While I'm sure there are jobs to be found, I'm not sure there are jobs to be found with better salaries that would hire someone from AIG. I'm not completely sure, but there might be a bit of a stigma attached to anyone coming from that company right now.
@InfiniTrent: where would they go if they decide to walk away?
I say something smells fishy about this whole retention deal.
@InfiniTrent: I have never bought into that mentality, that departments of a company are so independent that their employees deserve different treatment. One flag, one company, one treatment. No company profit, no employee bonuses.
@InfiniTrent: It said payments of between $92K and $4M. With $4M you can hire Merrill Lynch's CEO! He's looking for a bonus! He'll keep AIG running for sure!
So this is where our BILLIONS are going! Err, I can't understand some of these companies. These crazy high figures make my head spin, but then again I'm just a regular working guy. I don't get $100K bonuses, ever. I should have went into finance/management, it's where all the money is, and currently going.
Leave and go WHERE? Last I checked the ENTIRE economy is failing.
Who called it?
That's right: everyone.
as a taxpayer i would like a refund
I'd like to know how exactly AIG spent all the billions. An itemized list would be nice.
@InfiniTrent: And go where? And you really think there is no one to promote up if they did leave? It's terrible logic. And by using it they are claiming those that do not get bonuses are not capable people. So their entire company is full of idiots by their own admission.
Raise your hand if you didn't see this coming...This is a rogue company that despite taking taxpayer money to stay in business,will still reward those at the top of the power structure with outsize bonuses. I don't give a damn whether it's called a bonus or not,that's what it is. A zombie company like AIG should not give bonuses to anyone that doesn't bring in new,profitable business (if a salesman sells products that make money, fine, that helps us taxpayers a little) . But the argument that these are the best and brightest and losing them would hurt is not borne out by the evidence. This is just another example of the "fuck you" mentality that Wall Street has about this whole train wreck. And make no mistake- They are watching closely to see if they can get away with this. If they do,the next bailout will feature bigger bonuses for these crooks.
In an economy where many people are being laid off or taking paycuts...something tells me these people wouldn't exactly be jumping ship if they didn't get their bonus. "Fine! If you won't give me $900,000...I just go to....ummm...well I still want my $900,000, even if there are no companies hiring right now."
I make less in a year than any of those bonuses.... so why is my tax money going towards this?
I'm angry with AIG for spending taxpayer money in this manner.
I'm MORE angry w/ the legislators who passed the bailout - way to make sure the money went to the right things guys. Thanks. I feel WELL represented by my govt, let me tell you!
Next year we'll be hearing about how GM offered similar "retention payments" to their employees using our money.
Bailouts = fail.
Good. And I hope these companies like AIG continue to squander the money they received from the government.
Business as usual for all parties involved.
OK internet smart dudes, again tell us how the bail-outs were for our own good and those who apposed it, called the out-right-scams for what they were stupid again.
Has there been *1* story on how these bailouts did some good?
Anyone who didn't stand to benefit from these bailouts saw this coming from a mile away.
@tinmanx: Let me provide that for you:
Executive bonus
Executive Retreat
More bonuses
Even more lavish retreat
Canceled retreat (too much bad publicity)
Yet another bonus
Secret retreat
"Retention payments"
As a taxpayer, I have to ask...
Can I do a chargeback on this purchase?
I always thought paychecks were retention payments.
@Trick: The bailouts have given sites like Consumerist a lot of pageviews and corresponding ad revenue?
@Trick: And those who did stand to benefit saw this coming from about 70 miles away, their greedy little eyes glinting in the light as they watched it come.
@What The Geek: and let me be clear - I understand why, in principal, bailouts are a good idea, however, much like communism, bailouts look good on paper, but fail in practice. On paper bailouts provide much needed money to keep people in work, and allow companies to continue assisting their customers. In practice, bailouts fund large bonuses, and private planes. If the govt feels it's a good idea to issue a bailout, then it should come with some HEAVY stipulations.... like no $4mil bonuses.
@mindshadow: Salaries are not insanely high. They are in fact usually very low, with a good amount of money coming from the bonus.
Where I work at, they are. The owner is fond of saying "if you get a paycheck every pay period, consider it meaning you doing a good job". Because seriously...if you don't perform here, your ass is out on the street the next day. I'd love to see some wallstreet fat cats try to hold a real job for a change.
Good thing the Republicans are killing the US auto industry to pay for this!
It sounds as if its getting dangerous to even elude that you work for AIG at this point. The peasants are rallying with pitchforks and spades.
I for one have no pity for AIG upper mgmt.
Let it fail.
@Trick:
Well, for one thing, the entire financial system hasn't collapsed, making it impossible for even very financially strong companies to borrow the necessary operating cash to do things like make payroll.
@InfiniTrent: I think it is ridiculous. I work my butt off and didn't get a raise this year. Am I going to complain? No. Because no one got raises. And I'm not mad about it because I'd like the company I work for to stay in business so I have a job. The job market stinks for anyone and I think most employed people right now are just happy to have a job. The same should go for those execs. They should just be grateful they have a job.
@undefined: @blah,blah,blah: In april I will be a two year employee. I work full-time hours, but they consider me a part time employee. I do not get benefits. I did not get a yearly raise (everyone else in the hallway of offices [different department/supervisor than i] got like $0.50 raises ). In fact, I was told that since they can't give me benefits I'd get a raise to compensate, at least a little bit. However a yearly raise nor the compensation type of raise came. To date, I am still uninsured, benefitless and treated like crap by a primary-level eduction establishment (my employer)
Actually, I just caught wind that I should put out my resume... ,"actually Jonathan, I can't advise you in any direction, because I'd hate to say yes and then there be layoffs in the school district."
So...
I don't have a problem with paying people to stay to clean up or fix the mess. But that's only if AIG is sure these people aren't able to jump someplace else. In today's job market, it seems the person that gets the $3 million retention bonus would probably have a tough time finding a similar job. And I'm guessing the person(s) who is getting the $3 million bonus was probably high up enough in the company that he or she should take some personal responsiblity for this clusterf**k.
If justice were to prevail, they would get their "retention bonuses" in the form stock warrants. Such warrants were "good enough" to backstop bailout funds - and so should also be good enough for bonuses, right ?!?
Your Bush's America at work with your tax dollars. Glad you voted for him?
On the surface, I hate this. But on the other hand, if you don't pay the qualified people who build the framework of a business, it'll crumble, because they'll leave.
"Oh, but they're the scammers that got them into this mess!" some will say. "Let 'em leave!" No, that's not all true. The majority of these folks weren't idiots, we can safely assume.
Is $3 million absurd as a "retention payment"? Yes. Is it unreasonable for a company to pay its best and brightest key employees to make sure they don't jump ship? No.