Devastating

by digby

Apparently, the very special AIG executives needed to be reassured that the taxpayers weren't going to deny them their well deserved bonuses. After all, they had suffered devastating losses in their personal wealth:

Even if the U.S. government were to entirely take over American International Group, company executives would still be able to collect bonuses at taxpayer expense, according to a letter from AIG CEO Ed Liddy to employees disclosed in the company's recent SEC report.

"As this special award is being made to a very select group of executives, I ask that you treat it as confidential," wrote Liddy. The letter is dated less than a week after the government first bailed the company out.

The letter assured the select group that "in the event the AIG entity that is your employer (the Company') experiences a Change in Control (e.g., consummation of a merger, consolidation, statutory share exchange or similar form of corporate transaction involving the sale or other disposition of all or substantially all of the Company's assets to an entity that is not an affiliate of the Company), AIG guarantees the payment of the 2008 Special Cash Retention award on the dates and under the conditions specified above."

[...]

Some of those in line to get bonuses have family in the right places, according to the filing. The daughter of top executive Edmund Tse, Ada K.H. Tse, is president and CEO of AIG Global Investment Corp. (Asia) Ltd. In 2008, she pocketed $400,000 in "retention awards" and $250,000 in a year-end bonus. She will be "eligible to receive an additional amount that has not yet been approved. Ms. Tse also will be eligible for retention payments in 2009 in the amount of approximately $600,000," reads the report.

Daniel Neuger is the son of another top executive, Win Neuger, and serves as "managing director of AIG Global Investment Corp. and AIG Global Asset Management Holdings Corp." He took in $75,000 in "retention awards" in 2008 and is on track for roughly $110,000 in 2009.

Liddy promised there was more to come. "I fully recognize the devastating loss of personal wealth you've suffered, and pledge to you my personal commitment to provide an opportunity for substantial wealth creation through a combination of cash and equity awards in the coming months and years," he wrote in the letter to employees outlining the bonus policy.

I think this pretty much sums up the problem. Corporate narcissists believe they should be rewarded even when the organization they run has not only failed but has nearly destroyed the entire global financial system. They are very, very special. Besides, they suffer a lot from the embarrassment at having been involved with such unpleasantness and that is punishment enough. It is for the lesser people to lose everything they have.

When Bush called his reign "The Ownership Society" I don't think anyone understood exactly what he was saying. Now we do.

Update: Speaking of the crisis, is everyone aware of this? Atrios has mentioned it many times. Maybe I'm not reading the right magazines or blogs, but I never see anyoneelse talking about it. It seems to me that the weakened economy could be hit much harder by this second wave than the first one, especially since people are fully aware of the economic meltdown now. What's up with this?