AIG Bonuses were earned and should be paid

The unintended consequence of voting on something as ill defined as “change” is that we now need fences on both the Mexican and the Canadian Borders to keep US Business people from fleeing the US ! If you think the Democrats plan to impose a 90% tax on these AIG bonuses is a limited, one-time event, then you might also believe that Fidel Castro is a benevolent, misunderstood scamp.
The Obamunists have begun their version of the French revolution, by inciting the true believers to threaten AIG executives at their homes. Why ? They accepted their contractually guaranteed bonuses, that were overtly written into the Democrats stimulus plan. Treasury secretary Tim Geithner (D) and Senator Chris Dodd (D), both architects of the Obama bailout plan and stimulus bill made sure these bonuses were included in the (incorrectly labeled) stimulus plan.
When the public went berserk over paying bonuses to AIG these men developed selective amnesia as to how or why they had included these in the stimulus plan. The reality of these bonuses is obscured in the heated rhetoric. AIG, like many big companies has pockets of good business and pockets of bad business. Most of the bonuses being paid are essentially commissions, and were to be paid to managers who had very profitable business units within AIG. These large insurance and financial institutions have highly leveraged compensation plans for executives and managers, where managers get a base salary that is actually pretty small and if they make the revenue and profit numbers within that discrete unit, they can make huge money in the form of an annual bonus. If they miss their numbers they eat dog food.
The executives of the AIG sectors that were failing, and killing AIG were not in the bonus pool, and those executives made very little during 2008. Overall, AIG was a financial disaster, and in my mind should have been allowed to fail, file bankruptcy, clean out the incompetent management and re-build under normal bankruptcy protections. If AIG had filed for bankruptcy, these profitable business unit bonuses would have still been paid under bankruptcy law as they are a contractual obligation of AIG.
What we did instead is to insert the clueless hand of the Federal Government into this business, and essentially nationalize AIG, meaning it changed from a private company to a Government entity when it accepted 170 billion of TARP funds. The problem is, since the Government has no idea of how to run a private business, they overlay the government mentality of wage and price controls, onto a private company that has to survive in a free market system. The Socialistic impulses of the Obamunists were shown when Senator Schumer (D) announced using the Tax system and the IRS to punish these AIG employees by creating a very special 90% tax on selected people inside AIG.
When we give the Federal Government the right to selectively punish private individuals with targeted confiscation of their earnings we are opening Pandora’s box. As the months go by we will hear of many more individuals getting the heavy hand of Government reaching into their bank accounts. I talked with friends who work for Wells Fargo, and another of JP Morgan – Chase. They were notified that this 90% tax could apply to any company that accepted TARP money. These folks received a small performance bonus a couple months ago, for making a profit in 2008, which may be subject to this new unconstitutional tax. Now we’re talking tens of thousands of unsuspecting mid level managers of Financial firms who may be receiving a tax bill that is purely political and unjustified.
Congress knew about the AIG bonuses months ago. They only feigned ignorance with mock shock and disgust when the public outcry began. If we as a nation want to make private companies think and act like the government we are in for one heck of a downturn. The private sector runs on earnings and profits. The Government ALSO runs on earnings and profits as the Federal Government feeds off the private sector.
I believe we need to pick a side. Are you on the side of private enterprise, private property and personal liberty coupled with personal responsibility ? Or are you on the side of Government control of businesses, wages, prices and essentially every other decision we make in life ? As a lifelong Republican I was sickened by the big government Republican-ism of the last 8 years. We now are seeing even bigger government Democrat-ism that seeks to indebt us irrevocably to the Chinese with gargantuan spending programs that are not likely to relieve the recession.
We are also creating huge pressure for higher and higher taxes on everything. I suspect we will soon see a national sales tax in addition to our income tax. So much money is being vacuumed out of private citizens bank accounts and yet there is no real uproar, yet. Again –pick a side, lower taxes and less government intrusion or more taxes and much more government control of all that you do.