User:JCDenton2052/Sandbox16

AIG has received $170 billion in taxpayer bailouts and in the fourth quarter of 2008 posted a loss of $61.7 billion, the greatest ever for any corporation. Despite this, AIG announced that they were paying out $165 million in executive bonuses out of taxpayer funds. This quickly led to what many label a "populist outrage." President Barack Obama responded to the planned bailouts by saying "[I]t’s hard to understand how derivative traders at A.I.G. warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?" and "In the last six months, A.I.G. has received substantial sums from the U.S. Treasury. I’ve asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole."

Politicians on both sides of the aisle reacted with outrage to the planned bailouts. Senator Chuck Grassley (R-Iowa) said "I would suggest the first thing that would make me feel a little bit better toward them if they'd follow the Japanese example and come before the American people and take that deep bow and say, I'm sorry, and then either do one of two things: resign or go commit suicide." Senator Chuck Schumer (D-New York) accused AIG of "Alice in Wonderland business practices" and said "It boggles the mind." He has threatened to tax the bonuses at up to 100%. Senator Richard Shelby (R-Alabama) said "These people brought this on themselves. Now you're rewarding failure. A lot of these people should be fired, not awarded bonuses. This is horrible. It's outrageous." Senator Mitch McConnell (R-Kentucky) echoed his comments, saying "This is an outrage." Senator Jon Tester (D-Montana) said "This is ridiculous." and AIG executives "need to understand that the only reason they even have a job is because of the taxpayers." Senator Dick Durbin (D-Illinois) said "I've had it." and "The fact that they continue to do it while we pour in billions of dollars is undefensible." Representative Barney Frank (D-Massachusetts), Chairman of the House Financial Services Committee, said paying these bonuses would be "rewarding incompetence" and "These people may have a right to their bonuses. They don't have a right to their jobs forever." Representative Mark Kirk (R-Illinois) said "AIG should not be on welfare from Uncle Sam, and yet paying bonuses and transferring a considerable amount of taxpayer funds to entities overseas." Federal Reserve Chairman Ben Bernanke said "It makes me angry. I slammed the phone more than a few times on discussing AIG." Lawrence Summers, Director of the National Economic Council, said "The easy thing would be to just say, you know, ‘Off with their heads,’ and violate the contracts." Austan Goolsbee, of the Council of Economic Advisers said "I don't know why they would follow a policy that's really not sensible, is obviously going to ignite the ire of millions of people." and "You worry about that backlash."

Political commentators and journalists have expressed an equally bipartisan outrage. Conservative commentator Charles Krauthammer said "I would deny them the bonuses if possible. I would be for an exemplary hanging or two. Have it in Times Square, invite Madame Defarge. You borrow a guillotine from the French and we could have a party." Mort Kondracke, another conservative commentator, said "I was going to recommend boiling in oil in Times Square." MSNBC host Rachel Maddow said "Sometime in early 2008, that company signed contracts with its employees that said: 'Even if you cause the company to fail and nearly bring down the worldwide financial system, you will still get a bonus.' I mean, who writes those contracts?" Chuck Todd, also of MSNBC, wrote that "It's a lynch mob out there, and members of Congress seem to be carrying torches." Comedy Central host Jon Stewart said "You know, they say angry populism is all the rage. Literally, it's been building for months, simmering. Our proletarian rage feels so unfocused. If only someone would step up and put on the kick me sign." and "They're not good people." The New Jersey Star-Ledger editorial page read "This band of "best and brightest" just blew a $62 billion hole in the company. What's to retain? Heads should be rolling. Besides, is there really that much cutthroat competition for such an overpaid bunch of losers?" CNN reporter Carol Costello said "Some political analysts fear public anger has reached a tipping point."

The Washington Post reported that "Hired guards stood watch outside the suburban Connecticut offices of AIG Financial Products, the division whose exotic derivatives brought the insurance giant to the brink of collapse last year. Inside, death threats and angry letters flooded e-mail inboxes. Irate callers lit up the phone lines. Senior managers submitted their resignations. Some employees didn't show up at all." The paper quoted one anonymous AIG executive as saying "It's a mob effect. It's putting people's lives in danger." and another as saying ""It's going to blow up. I have a horrible, horrible, horrible feeling that this is going to end badly."

AIG has tried to defend the bonuses by citing contractual obligations, but autoworkers whose companies received bailouts were forced to renegotiate their contracts, despite making far less than AIG executives and having far less culpability. They also claim that only their executives can unwind their complex derivative deals. Rick Newman of US News & World Report argues that this is tantamount to extortion.

New York State Attorney General Andrew Cuomo sent a letter to AIG demanding "the list of individuals who are to receive payments" and "a description of each individual's job description and performance at AIG Financial Products" in order to determine "whether any of the individuals receiving such payments were involved in the conduct that led to AIG's demise and subsequent bailout" and "whether, as you claim, such individuals are truly required to unwind AIG Financial Product's positions." AIG failed to respond, so Cuomo subpoenaed them for the names of the bonus recipients. Cuomo announced that 73 AIG employees were payed more than $1 million in bonuses, saying "A.I.G. made more than 73 millionaires in the unit which lost so much money that it brought the firm to its knees, forcing a taxpayer bailout." and "Something is deeply wrong with this outcome."