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Mar 25

Written by: Diana West
Wednesday, March 25, 2009 4:36 AM 

"Dear AIG, I quit!" is the title of Jake Desantis' fascinating letter of resignation from AIG as published in today's New York Times. An executive vice president (not of the division related to the credit default swaps that brought down the company), Desantis agreed to stay on for $1/year, he writes, and he recently received --after his first round of taxes (and before the surely unconstitutional 90% punitive bonus tax the House has passed)--$742,006.42 of the notorious $165 million the company recently handed out in "bonuses."

Question: Were all of the recipients working for nothing to restructure the company? That certainly changes the bonus-ness of the payouts (Desantis calls them "retention payments"). Of course, maybe in Obamaworld execs on the dole shouldn't be paid, period. Such three-headed monster conundrums, of course, are simply what happens in the unnatural union of government and business, poisonously sanctioned by the misbegotten TARP and other bailouts.

Here is a particularly revealing excerpt of Desantis' letter to CEO Liddy:  

I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country’s call and you are taking a tremendous beating for it.

But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut.

My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That’s probably why A.I.G. management assured us on three occasions during that month that the company would “live up to its commitment” to honor the contract guarantees.

That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts “distasteful.”

That may also be why you authorized the balance of the payments on March 13.

At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts — until several hours before your appearance last week before Congress.

With these words, we begin to get a feel for the democracy-threatening undertow of mass hysteria plus mob rule. Imagine: CEO Liddy comes in, reviews employee contracts, AIG assures employees it will honor those contracts, decides to pay up early, and then, as political pressure builds, doesn't have the fortitude to stick up for the contracts, the company or the employees. What a disgrace. Desantis goes on:

I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It’s now apparent that you either misunderstood the agreements that you had made — tacit or otherwise — with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds.

You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.

As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.

Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you.

I'll bet.

The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to “name and shame,” and his counterpart in Connecticut, Richard Blumenthal, has made similar threats — even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press.

This is an unimpeachable point. Cuomo and Blumenthal are both feeding and drawing on mass hysteria-plus-mob rule.

So what am I to do? There’s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn’t disagree.

That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.’s or the federal government’s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need.

As a citizen-owner of AIG, that's OK by me. Meanwhile, Bonus Rage has served as a distraction from far more important concerns, including AIG's support for the spread of sharia (Islamic law). And what of the mass hysteria out there and enthusiasm for the mob rule? The good news is that most of it is confined. The bad news is that most of it is confined to Congress.

 

 

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