In an early episode of the DC Comics feature “Tales of the Bizarro World,” in which the inhabitants do the exact opposite of all Earthly things, a salesman is doing a brisk trade selling Bizarro bonds: “Guaranteed to lose money for you.”
Ladies and gents, welcome to Bizarro World.
If I recall, the last cash bonus I got was $50 for saving a reporter from being hoodwinked by a school-board wiseass before her story about a fictional candidate for superintendent — Quincy Adams Wagstaff, late of Huxley College — could sneak into the pages of The New Mexican. I certainly never scored a cash payout for introducing libels into stories, throwing monkey wrenches into the presses or setting the newsroom afire.
If we were still on Earth, the 43 fools and/or thieves who run the AIG Financial Products unit — which as Steve Benen notes “was responsible for the company’s mess in the first place” — would be awarded custom-fit tuxedos of tar and feathers and chauffeured off to prison on splintery rails. But we do things backassward here on Bizarro World, and so they will get $165 million in bonuses after AIG soaked up $170 billion in taxpayer dollars.
As Josh Marshall notes at Talking Points Memo: “The folks running AIG’s financial products division should be happy to escape this mess without criminal indictments. And that’s not hyperbole. When you look at what they were doing, foolish or high-risk behavior are inadequate descriptors. It really amounts to fraud.”
Mad Blog Media 
Heard that on Public Radio this morning and almost spit out my breakfast. Emailed the White House, for all the Effing good that will do.
Maybe we need some vigilante justice, and I don’t mean waterboarding those thieves. This latest insult to the public has gone too far. Sawing would be too nice. Scaphism would be more appropriate, since we will have to live with this mess for a long and painful time to come.
http://listverse.com/history/top-10-gruesome-methods-of-execution/
Yes, it truly is bizarro world. I’m the one of the best at what I do, but can’t find a job. It used to be head hunters were always ringing me up to try to lure me away. Now, knuckle heads are running the shops into the ground and are proud of it. 100% bizarre. Keep calling them like you see them, Patrick.
Whoa! I think we’re all pissed at the wrong people here. So the thieves running AIG are gaming the system and getting huge bonuses. Does that surprise you? They’re MBA’s! Their degree is basically in how to rip people off! Maybe I’m jaded after eight Bush years, but this doesn’t surprise me at all.
What does surprise me is that our so-called elected folk gave them the money in the first place with no strings attached. (Or maybe there were stings attached: I have a hard time believing that certain members of Congress didn’t make out like bandits on this.) Think about it: they handed over 170 Billion (“Billion” should always be capitalized) without specifying in writing what the money can and cannot be used for. They left a loophole (intentionally?) big enough to jam a 165 million dollar bonus through.
This first came up when the banks were given money with which to make loans, and then didn’t. This would be funny if it didn’t mean the end of our economy as we know it.
Oh, the systems has been gamed and we’ve been ripped off alright, but by more than just the scum at AIG.
Yes, is there not a parable about “rocks” and “glass houses?” Or is that just for “the other guy?” Just curious….
The dirty, rat bastards are more than likely the flunkies in DC running the joint, then the flunkies on Wall Street running the joint. One should look out for the other….unfortunately your guess is as good as mine as to whom that refers.
Remember: ‘the business of business is to make money.’ Recite it each time you cash that check….pay that bill….check your mutual fund/401(k)/shoebox….. Because once you forget that, or drop too much flashback medication from those Fab 60’s, you are doomed to make the same mistake each time.
Robert Reich weighs in, noting that the real scandal is that “even at this late date, even in a new administration dedicated to doing it all differently, Americans still have so little say over what is happening with our money.”
He continues:
“This sordid story of government helplessness in the face of massive taxpayer commitments illustrates better than anything to date why the government should take over any institution that’s ‘too big to fail’ and which has cost taxpayers dearly. Such institutions are no longer within the capitalist system because they are no longer accountable to the market. To whom should they be accountable? As long as taxpayers effectively own a large portion of them, they should be accountable to the government.
“But if our very own Secretary of the Treasury doesn’t even learn of the bonuses until months after AIG has decided to pay them, and cannot make stick his decision that they should not be paid, AIG is not even accountable to the government. That means AIG’s executives — using $170 billion of our money, so far — are accountable to no one.”
Some backround. Article I, Sec. 10, Clause 1, U.S. Constitution. See the clause on the obligation of contracts. I think this is the sticking point.
“No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.”
Back when I was on a union board, we used the same “Contracts Clause” in the U.S. Constitution to win a case against Gov. Ben Cayetano of Hawaii. Ben and the Legislature wanted to retrospectively institute a “salary lag” after the faculty contract was signed. In the short term, this would have amounted to a free and indefinite loan to the state, i.e., defer paying our salary for two weeks. You would finally get your money when you retired.
Basically, the Constitution sez that the government cannot abrogate a signed contract. Otherwise, they could pass a law abrogating contracts, which apparently the newly freed states did under the Articles of Confederation in order to save money. Some recent thoughts about retroactively changing the rules on individual mortgages might also be worth litigating if you are a bank, if there was a way to come out ahead, which I doubt.
Interesting discussion here.
http://www.answers.com/topic/contract-clause
Last two paragraphs indicate this clause is losing its punch. If Obama has the will for a fight, he might want to challenge these bonuses under the logic of U.S. Supremes rulings such as Home Building and Loan Assn. vs. Blasdell or subsequent cases. From the link above: “In Keystone Bituminous Coal Association v. DeBenedictis (1987), Justice John Paul Stevens stated, “It is well‐settled that the prohibition against impairing the obligation of contracts is not to be read literally” (p. 502).”
So much for Justice Steven’s belief in Constitutional proections, eh? But even though we “own” this sunken ship the SS AIG, the contracts with the fat cats may yet stand. If so, give them their bonuses and fire their asses.
James is right about the biz of business is to make money. However, the business of government is to protect the public and make sure the playing field is legal and somewhat level. These high rollers had found a way around traditional banking regulations and there was no set of rules on the smoke and mirrors of credit default swapping. So they gambled with huge amounts of everyone’s money.
Of course, the public is also culpable because everyone liked the idea of using their home equity as an ATM. But I doubt the average Skeptical Joe had any way to influence these decisions, short of pulling out of the market. Certainly BushCo turned a blind eye towards credit default swaps just as liberal Democrats turned a blind eye towards subprimes.
In a modern economy that we all depend on, someone has to be minding the store. Or, both Wall Street and Government better start watching out for the mobs with ropes, shotguns, and pitchforks. Economic collapses are the things that revolutions are made from. FDR may have prevented one here in the U.S., but he had a lot of help from Tojo, Schickelgruber, and Il Duce, those three guys who should be getting most of the credit for getting Uncle Sam back to full employement.
Hey, some good news on the eco-stim front. I’m getting an extra twenty five simolians per week going back to Feb 22. Now THAT’S what I call cutting a fat hog !!!
Boz and others,
Extra 25 smackers. Look out dude. If that’s not a raise from your employer it just the feds decreasing your witholding each pay period in the hopes that you’ll go out and blow it on some stimulusizatingly-related activity. The decrease in your witholding just increases your tax bill come April ’10, or decreases your refund by that amount.
Too big to fail. Yeah boy something should be done. How about this. Historically the FTC has used industry concentration measures like the HHI to decide if a merger should go forward or not. Resulting concentration too high? Thumbs down. Concentration still low enough? Thumbs up. I suggest that we legislate a maximum allowed HHI (lower than current level), and further direct through legislation that the FTC act to evaluate all industries in the US to see if their current concentration gets a thumbs-up, or thumbs-down. If thumbs-down, they break ’em up, just like the FTC did with Ma Bell years ago, using the Sherman Antitrust Act and related existing legislation.
Jon, as I’ve noted before, I’m no economist. I wanna count over 10, I have to take off my shoes. But I kinda like that break-’em-up notion, and think it might apply to my line of work.
At one time there may have been some perceived benefit to being part of a massive chain that could provide a Washington bureau, foreign correspondents and other top-shelf goodies. Today, that sort of thing is in the hands of TV, the Intertubes and a couple high-end rags like The New York Times. Even chains are cutting back on foreign and Beltway presence.
For today’s local paper, the only mission that makes sense is covering local news. But these sheets all have to kick back to the chain what brung ’em, so they operate at a loss despite a history of being able to deliver the kind of ROI that a loan shark would deem usurious.
So break ’em up. Set them all adrift and see who sinks, who swims, based on their ability to provide local news to a local audience.
Patrick, thank you for your pithy remarks and the image of those unindicted criminals encased in tar. I do think feathers are too good for them though – maybe they should be rolled in fiberglass before the tar is
applied. Then perhaps their photos should appear on a ‘Most Wanted Criminals’ flyer.
In my area, the 3 daily papers have downsized. One went to a tabloid format in 2007/8 and the other 2 downsized their content in February.
All have been downsizing their staffs for several years. One is a Hearst
paper.
we’re still suffering the side effects of our ill-fated fling with a Bizzaro presidency.
“War am peace. Freedom am slavery. Ignorance am peace.” — President George W. Bizzush (Texas Air Farce, ret.)
Khal et al,
I’d agree up to a point…that one being that what may have happened a week ago isn’t going to work from here on out.
No matter how much you want to believe that “the business of government is to protect the public and make sure the playing field is legal and somewhat level” to be true, I am still waiting for government to do that!
Not where I sit….in the hallowed halls of justice in the great state of Cali-four-nee-yah. You see, here we have so many laws on the books that our state budget is mandated to give up 40% of its bottom line to education. Which, if you’re a teacher or a hippy, sounds all good. Or maybe if you were educated in Cali-four-knee-ya in the 50s, where you’d figure out that 40% of $42 Billion dollars is ‘a lot.’
Yep, here on the Left Coast our tax dollars (income and state sales) plus the fees picked up from selling $1 Lotto tickets goes to finance education….and a system that returns a ranking that is 49th in the United States of America. Yep. 40% of our state budget goes to finance a hole that returns so little that we are ranked nearly DFL in the US of A for educational return on our investment!
So…seeing as how the government works so well at getting a return on it’s investement (and in something that SHOULD pay off in the future), do you want the Federal government with their greedy little porks feet in the barrel?
Not me. I’ll take my chances with a free market run by swine before I give up any dollars to the fat bastards that you elected to represent me, and you, and your future. I didn’t elect them, so they can’t stand for me. That, my compadre, is guaranteed in the Constitution. Or was that the Declaration of Independence? I forget cause I be edjubecated in Kali-4knee-ah.
As one wise man once observed: “The revolution will not be televised!” Saddle UP!!
Khal,
Salary lag? Now there’s a brilliant idea made up by some rocket surgeon who’s more interested in creative paper shuffling than solving real problems. The Army did that when I was a young buck. We used to get paid on the last day of the month, and they dropped one payment from the last month of the fiscal year and moved it to the next year, saving us a bundle right now but creating a 13 month payroll for the next year. That’s called robbing Peter to pay Peter. And the summbeetch got a medal for that idea!
Jon- that was an increase in my unemployment “benefits”. $25.00 per week that also carries over to any extension given when my account runs dry. Hopefully, I won’t have to count on an extension, what with all the great new jobs that will be falling off of the job tree any day now. Thanks, Prez, and my children’s children thank you. And a big, Laurel and Hardy hand shake to ex Prez Geo II
I guess we should take a few minutes off of our own Foaming Rants and wish Patrick a Happy St. Patrick’s Day. If such a wish is in keeping with the situation.
Slainte, y’all.
Going to mix a beer with my codeine-flavored cough syrup and other pneumonia meds and see what happens.
Latest just on the boob tube says Congress will pass as high a tax on the emplyees of AIG as the law will allow. Of course this is just posturing as tax laws can’t be made retroactive due to the prohibition against ex-post facto laws in the US Constitution. I’m hoping to sell the pitchforks and baseball bats at the storming of the local offices of AIG. 😉
I’d invest in torch and pitchfork manufacturers right now… if I had anything to invest.
Well, Steve, if you have a torch or pitchfork (or double barrel) it is probably appreciating right now.
Whoah ho!! Looks like some people are throwing down some hate here today….careful how you word things there boys. Or it might sound all wrong…..