Quote:
Originally Posted by Dan D
What I don't understand is why are bonuses paid when the company does not realise any profit or even worse when the company would have gone bankrupt without government help.
From what do you want to pay bonuses if there is no profit?
And imo it makes sense that companies that have received bail out money should not pay bonuses to their managers.
"No profit, no bonus" should have been written into these bonus contracts, imo.
But I am no expert, so please enlighten me.
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The AIG bonuses in question were contracted over 2 years ago. The reason they were contracted that way was because our all-omniscient government felt it necessary to limit bonuses, causing a whole new cottage industry of lawyers who do nothing but figure out how to structure bonuses that meet the federal guidelines, yet still reward "productive" executives.
Whether AIG was profitable 2 years ago, I don't know, but I would be willing to bet they were.
There were stipulations in the original draft of the bailouts that would have taxed these bonuses at something like 60%, but, for some reason, a member of a party not to be named because they control the entire country at the moment decided to remove or greatly restrict the taxation on these bonuses.
This current "outrage" and claiming not to be aware of these bonuses is merely another "smoke and mirrors" trick to make the average citizen think that the great and wonderful government is looking out for our "best interests".