Thursday, March 19, 2009

The Rage Over AIG

I read in the paper that Mr. Liddy and some of his staff have received death threats over the awarding of fat bonuses to the traders who caused the crash of the company. He came out of retirement and took on the job of guiding AIG out of the mess for a token salary of $1/year. The contracts in question were not written on his watch and he told the congressional committee that he took offense at the tone of their questioning.

I sympathize with him. When I worked in unemployment insurance during the downturn of the 80s I got at least one death threat (there were others that were implied but not explicitly stated). It is unnerving to have someone tell you they will kill you if you don't do what they want and I do not for a moment condone violence as a solution. That being said, what was he thinking? My father-in-law, a very practical man, once observed that there is nothing less common than common sense and lately those in high places seem determined to prove him right.

If Mr. Liddy really didn't think it was right, if he really found it distasteful, why didn't he refuse to honor the bonus provisions and make his refusal public? Had he done that, instead of him taking the heat for this debacle, those who tried suing to enforce the contracts would be getting blasted for their audacity in demanding to be rewarded for their malfeasance. Their names would be public, the outrage would be properly directed at those who deserve it. Mr. Liddy would be held in high regard for taking an honorable, if legally tenuous, stand. Is he really so naive that he did not foresee that the taxpaying public would be outraged? Where is his common sense?

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