Some distinctions about the AIG bonuses

Posted by Marc Hodak on March 26, 2009 under Scandal | Be the First to Comment

Whenever a scandal involves a group, reporting about the scandal immediately erases distinctions about people within the group.  We do the same thing with enemies of the state (or church, or whatever).  That’s why it’s dangerous to be part of an out of favor (or even rotten) organization, even if you’ve got nothing to hide, or had nothing to do with the rot.

A purported AIG insider has released a letter that attempts to provide some relevant distinctions regarding the scandalous AIG FP bonuses:

1) On October 22nd 2008 (one month after bailout) Andrew Cuomo
reaffirmed our right to payments under the retention plan.
2) On October 9th Bill Dooley, the head of financial services at AIG,
restated that the treasury and AIG were committed to payments under the ERP.
3) AIG reduced the value of our deferred compensation to zero,
effectively cutting the value of the contracts under the ERP by about 30-50% depending on the amount due to each employee.
4) AIG wiped out the value of our previously earned deferred
compensation, costing me, for example, about half my saving and many others in the company the same.
5) At no time did AIG ask to renegotiate the contracts or plead
extenuating circumstances. Many of us would have worked for much less or for nothing just to clean things up.
6) AIG prepaid 30% of the ERP amount in December with their hearty thanks for a job well done. The treasury knew of and had to approve this.

Is it really fair of them to try to renegotiate after we have
performed on our half of the contract? It would have been fair in
september during the bailout, or in october. Those were extraordinary circumstances. But is it fair of them to come to us after the end of the contract and then ask for the money back after many of us have made personal and professional sacrifices based on these contracts? I, along with many of my colleagues, have expressed a willingness to give the money to charity. But under no circumstances will we accept that we did not earn the money. Is it fair or criminal that Cuomo would threaten us with the release of our names if we don’t return the money? That is blackmail. It is a crime of the most despical nature.  Hopefully Cuomo will meet the destiny of the last New York Attorney General to mess with AIG, Spitzer.

Consumers of scandal news simply don’t have the bandwidth to make those distinctions.  The MSM, whose own rot is carefully hidden from view, profits from blurring them in the pursuit of a good “story.”  Distinctions undermine “the story,” which is inherently more interesting when the facts are selected and interpreted in a particular way.

Unfortunately, no matter how much clarity we begin to get as the details come into sharper focus, the original story is already out there.  The people have finished it, put it down, and moved onto the next one, like the consumption of chips and dip–empty calories that never fill you up.

HT:  John Carney

UPDATE:  Jake DeSantis piles the shame.