Re: Congress' reaction to AIG bonuses -- am I the only one concerned?

[David Farber <dave () farber net>]

"takes no consideration for the compensation of those who take risks to
create wealth."/

An examination of Ennron and other such shows that all to often the  
gamblers bet with other peoples money, collect the short term benefits  
in commissions and bonuses and then run. Whem the bets are wrong --  
they are far gone  djf



Begin forwarded message:

From: "Mac McKnight" <dmcknight15 () comcast net>
Date: March 21, 2009 12:19:09 AM EDT
To: <dave () farber net>
Subject: RE: [IP] Re:     Congress' reaction to AIG bonuses -- am I  
the only one concerned?
Reply-To: <dmcknight15 () comcast net>

There is a lot of heat and noise surrounding this issue, but very little
light or understanding of the facts involved.  It was nice to see the  
quotes
from Tribe, as that helped dispel some of the uninformed rantings  
about the
constitutionality of the law.

AIG is a very large corporation.  Essentially, a small group in London
persuaded upper management to engage in insuring against credit defaults
without hedging against the risk.  They were greedy and didn’t  
understand
the risks involved and our government failed in its responsibility to
properly regulate them.  But to punish all of the employees for the  
sins of
a few would surely cause the taxpayers to lose most of their  
investment in
the company, not just a few million.  Treating all of the employees as
culpable will simply encourage the high producers to leave for greener
pastures, leaving the company a husk.  This is not a fantasy, but a very
real risk.  The top financial firms are always looking for top  
talent.  Keep
in mind that the most valuable assets of this company are its employees.

I’m not trying to defend the bonuses themselves.  I personally think  
much of
them are excessive.  But that is a broader issue, concerning what is
excessive compensation for our society as a whole.  Rich Kulawiec’s
comments, while they point out flaws in our values for compensating  
people,
takes no consideration for the compensation of those who take risks to
create wealth.  Without these “doofuses”, we would all be much poorer.
We’ve tried organizing societies without a profit motive and it just  
doesn’t
work, as it is against human nature.

The key here is proper regulation.  The strict free market advocates  
of the
Bush administration have caused us tremendous pain.  We can’t place such
tremendous responsibility for the wealth and well-being of our country  
in
the hands of such organizations with little or no oversight,  
especially if
we view them as "too big to fail."  On the other hand, policies that  
ignore
the profit motive in hopes of an egalitarian society where we all work  
for
the common good are pie in the sky.  We are a long way from applying the
ideals of open source programming to our society as a whole.

It would be quite entertaining watching Dodd, Geithner and others dance
round and point fingers, if it weren’t so depressing to see such lack of
leadership.  We are witnessing cynical Washington politicians whip up a
populist frenzy, only to their horror seeing it rebound against them.   
It
reminds me of the French Revolution, when many revolutionaries were
themselves beheaded when the revolution spun out of control.

DeLoss McKnight



-----Original Message-----
From: David Farber [mailto:dave () farber net]
Sent: Friday, March 20, 2009 12:57 PM
To: ip
Subject: [IP] Re: Congress' reaction to AIG bonuses -- am I the only one
concerned?



Begin forwarded message:

From: Rich Kulawiec <rsk () gsp org>
Date: March 20, 2009 1:36:50 PM EDT
To: David Farber <dave () farber net>
Subject: Re: [IP] Re:    Congress' reaction to AIG bonuses -- am I the
only one concerned?

There is a larger and more long-term issue here.

Is anybody actually worth a million dollars (to pick an arbitrary
and round number) a year -- to society-at-large?

Dr. Ben Carson, maybe.  Stephen Hawking, certainly.  And similar.

But some doofus who merely shuffles money around?  I think not.
(Doubly so, some doofus who does it *very badly* and manages to
lose most of it.)

Neither any movie star, nor athlete, nor celebrity, nor CEO.  NONE of
these people are actually doing anything which provides value to society
in a quantity sufficient to justify such an enormous wage.

On the other hand, it's not difficult to think of any number of
professions
where undercompensation is severe and chronic: "teaching" is merely one
of the more obvious examples.  And yet, the teachers working away today
in schools across the country are doing vastly most valuable work than
anyone on Wall Street.  How many teachers could we give a 25% raise to
just using the money handed out in bonuses by AIG?

We, as a society, really need to readjust our concept of the value
of work.  We have lavishly rewarded the selfish while nearly ignoring
those who sacrifice much for the common good.  And those selfish few
have "rewarded" us by destroying our economy, costing millions of people
their jobs and their homes and their peace of mind, and diverting our
national attention and resources from our many other pressing problems.

We should return the favor -- showing them exactly the same respect,
mercy, generosity and compassion that they've shown us...and no more.

---Rsk




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