Greedy Greedy Greedy

So AIG wants to reward themselves for deep-sixing the economy:

American International Group is preparing to pay millions of dollars more in bonuses to several dozen top corporate executives after an earlier round of payments four months ago set off a national furor.

The troubled insurance giant has been pressing the federal government to bless the payments in hopes of shielding itself from renewed public outrage.

I'd say, I've got your blessing right here.

The greed of Wall Street predates Gordon Gekko, as Matt Taibbi hilariously and pointedly nails Goldman Sachs in Rolling Stone, who claims that it "has engineered every major market manipulation since the Great Depression," and lays out:

The history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled-dry American empire, reads like a Who's Who of Goldman Sachs graduates. By now, most of us know the major players. As George Bush's last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. Robert Rubin, Bill Clinton's former Treasury secretary, spent 26 years at Goldman before becoming chairman of Citigroup — which in turn got a $300 billion taxpayer bailout from Paulson. There's John Thain, the asshole chief of Merrill Lynch who bought an $87,000 area rug for his office as his company was imploding; a former Goldman banker, Thain enjoyed a multibillion-dollar handout from Paulson, who used billions in taxpayer funds to help Bank of America rescue Thain's sorry company. And Robert Steel, the former Goldmanite head of Wachovia, scored himself and his fellow executives $225 million in golden-parachute payments as his bank was self-destructing. There's Joshua Bolten, Bush's chief of staff during the bailout, and Mark Patterson, the current Treasury chief of staff, who was a Goldman lobbyist just a year ago, and Ed Liddy, the former Goldman director whom Paulson put in charge of bailed-out insurance giant AIG, which forked over $13 billion to Goldman after Liddy came on board. The heads of the Canadian and Italian national banks are Goldman alums, as is the head of the World Bank, the head of the New York Stock Exchange, the last two heads of the Federal Reserve Bank of New York — which, incidentally, is now in charge of overseeing Goldman.

But there's three greedies in the title of the post, and the last one for tonight is a couple, Doug and Cindy Hampton, which is increasingly looking like an Indecent Proposal variation where the reveal is looking like Doug pimping out his wife to Sen. John Ensign (R-NV) for a long period of time in hopes of the big score:

Senator John Ensign’s wealthy parents gave almost $100,000 to his former lover and her family, ostensibly out of concern for their welfare and as part of a “pattern of generosity,” his lawyer disclosed Thursday...

...“After the senator told his parents about the affair,” the statement issued by Mr. Coggins said, “his parents decided to make the gifts out of concern for the well-being of longtime family friends during a difficult time. The gifts are consistent with a pattern of generosity by the Ensign family to the Hamptons and others...

...The disclosure of the $96,000 gift came a day after Doug Hampton said on a Las Vegas television program that Mr. Ensign had paid Mrs. Hampton more than $25,000 in severance pay.

Y'know, a good couple is a good team. Working together towards common goals. And not too possessive -- his wife was bending the marital contract for nine months (December 2007 - August 2008).

On the Ensign side, isn't he getting a little old for his folks to be bailing out his adultery?

Grifters, grifters everywhere. Wall Street and Washington.

Who could have predicted that?

Now?

So is Obama a hero now, and Geithner o.k?

• They release their toxic asset, er, "legacy loan" plan to reasonable acclaim, save Paul Krugman.
  
  
• The stock market jumps 7 percent on the news of the plan.
  
  
• February home sales had an unexpected uptick.
  
  
• Some AIG execs are returning the bonus money.
  
  
• And more Madoff assets are found.

I guess the same cable news geniuses that were starting to blame Obama for the situation he inherited are going to start praising him now?

Tell me when it happens...

Circuses of Bread

Concerning the AIG bonus tax, I agree with this Andrew Sullivan reader:

It's stupid, and probably unconstitutional, sure. But it's great because it gets us past what is, in the big picture, a trivial issue. If the bill becomes law, Americans can feel like the government did something to get their money back and we can move on to dealing with real problems. A lawsuit challenging the bill will follow, and in a year or two, it will get struck down, and no one will care, because we'll either be on our way to a recovery, or so deep in shit that we'll have much bigger problems on our mind.

I'm glad people have gotten angry, and it's good for the powers that run this country -- both Wall Street and Washington -- to remember that class war starts with them.

But the thing to remember is that fascism starts at home and it's based solely on populist rage, always borne of fear. Those who harness that rage in America can get pretty far -- Huey Long, Joe McCarthy.

Currently Governor Sarah Palin and whoever that guy is who's playing Joe the Plumber appear to be top contenders, vying for it. She's having her political action committee, Sara PAC, determine policy in Alaska, turning down Obama's stimulus (like education) money so she can run against him and for the GOP nomination on it. Endlessly. And as for Joe, with his soft-spoken dogwhistle to the rage, I contend he could be our next face in the crowd:



The fact is that there is ample reason to be angry with the capitalist class of money manipulators who take such a high percentage of our nation's wealth but diminishing responsibility there at the top of the food chain. But these banks are going to take a lot of dollars -- much or most of which will be in reserve so they can legally open their doors every day -- and it'll take at least a year to winnow through all the bad instruments. And maybe eight years until it's all cleaned up -- if Obama gets to enact enough controls.

John McCain is right: lay off of Geithner. Especially on the left. He's a regulatory guy who's finally working for an honest President, and he's working on the biggest economic meltdown since 1929 without a full staff yet. Schwarzenegger is right:

Schwarzenegger, along with Pennsylvania Gov. Ed Rendell, a Democrat, and New York City Mayor Michael Bloomberg, an independent, met with President Barack Obama today in a closed meeting to discuss how to shore up federal spending on transit systems and renewable energy projects.

After the meeting, Schwarzenegger said the trio let the president know that "we are 100 percent behind him on this, to go out and to sell this to the American people.

" I think there is a tremendous demand out there for this,'' he said. "Not only does it help us make our economy function better, but also it helps us in creating jobs."

Every time you think of a bank getting bailed out, think about all the pension funds and municipalities that can't afford for our banking system to collapse. That's the gun those behind the derivative business grafted onto AIG's good name are holding to our nation's head.

It's going to be a rough ride, but I can't imagine anyone better equipped than our current President to navigate us through it.

Can you?

P.I.G.

So AIG, the massive insurance company our nation has just bailed out, is using our tax money to pay bonuses to the least deserving -- the pigs that got us into this mess:

"This is a corporation that finds itself in financial distress due to recklessness and greed," Mr. Obama said Monday, his voice rising in anger. "Under these circumstances, it's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay."

At issue are retention bonuses for employees of AIG's financial-products division, whose credit default swaps brought AIG to the brink of collapse. The government controls AIG through an 80% equity stake and as a major lender and doesn't have legal authority to freeze payments on its own. The U.S. has committed $173.3 billion to AIG, including $70 billion from Treasury's rescue fund.

Obama's pissed, per the above quote from this appearance today:



What's to be done? For one, New York State Attorney General (and frontrunner for next NYS Governor) Andrew Cuomo is getting strapped:

The attorney general is seeking the list of employees who will receive these bonuses, as well as their job information and performances. Mr. Cuomo said that the company had failed to heed a previous request for this list.

Mr. Cuomo is also demanding the contracts guaranteeing these bonuses and the names of individuals who developed and negotiated the agreements.

A spokeswoman for A.I.G. told DealBook in an e-mailed statement: “We are in ongoing contact with the Attorney General and will respond appropriately to the subpoena.”

One wonders what the government can do -- especially for the money that's already in the hands of the scumbags who built the derivatives business and live in a different America than 99% of us. If we own the company, can we abrogate our own contracts? Or, per these very smart guys:

Firstly, the US trustees in charge of the firm must immediately instruct the corporate treasurer to make no payments of any bonuses. They also need to order him to issue stop payment orders on any checks that fly out the door at the last minute, as with Merrill Lynch. Then the trustees need to split off the derivatives unit from the rest of the firm and separately incorporate it. This step leaves AIG's other businesses free to operate as usual. If the recipients of the bonuses refuse to waive them, then the derivatives unit should at once be thrown into bankruptcy, terminating all obligations to pay them. Right now, press reports suggest that the firm's top management waited until the last minute to inform the government of what was happening. AIG CEO Edward Liddy, accordingly, should be asked to resign at once, for the sake of public confidence and to send a clear signal that gaming the system is unacceptable. It is also past time for an investigation of the validity of AIG's past accounting and securities disclosures and its executive compensation program by the Office of Thrift Supervision, the Securities and Exchange Commission, and the FBI.

Here's my theory: if you investigate deeply enough into anyone at this level of securities trading and manipulation, there is sure to be something prosecutable that comes up.

Squeeze these piggies. Until they squeal.