Of course we now all head about the AIG scandal and how the press in America has twisted this way out of proportion. Now comes out that Obama administration and Congress knew about the retention bonuses for months, and Chris Dodd inserted the language in the Stimulus bill. This is nothing more than political posturing.
If AIG has to return the bonuses, the executives should do a John Gault, quit in mass, and sue the government for breach of contact.
As for the CEO misdoings, for the last seven year or more there is one central connection and catalyst for CEO misdeeds: government regulation starting with the limitation of deductibility of CEO salaries which in turn causing companies to turn to bonuses, stock options and other forms that in the past has lead to the temptation of corruption. The simple solution is let company pay their CEOs like the rest of us: in cash. . The second issue is anti hostile takeover regulations of the 1980’s. The unintentional effect was to take the only weapon stockholders had to hold, boards of directors, officers and CEO’s accountable. If stock holders felt that the company was underperforming, they could vote their shares to a white knight that would fire and replace the directors and the CEO.
Government should never been in the business of running or bailing out private business. No company is to big to fail, if to big like AIG and GM, they should be broken up and sold which in turn allow new business to be created and grow and bring real stimulus to out economy
