Wednesday, March 18, 2009

Cheap Shots

If you owned a failing business which was doing nothing particularly useful -- lets call it AIG -- and your salesmen convinced the government of the United States to give it over $100 billion of no-strings attached money in order to save it, wouldn't you say you had a pretty good year, all things considered (like bankruptcy and indictments)?

Wouldn't you let those salesmen split a 1/10 of 1% commission?

Since when are companies, say defense contractors, who do business with the government not entitled to pay bonuses?

The rule of law -- because we have no good second choice.

Yeah, we could have found a legal way to hold up the bonuses and hired $100 million worth of lawyers (like me)to prevent the payment of the same amount of bonuses. And yeah, we could have found a way to negotiate a settlement. That means that every one of those executives would have had to hire a lawyer (like me). Lesson is that if you do business with the government, you better know that they are a group of lying jackals whose word is no good. A Republican wet dream, I know .. But still. There is much more important, and easier, work we all need to be doing now.

The problem it seems to me is that old chestnut -- never steal anything small. $100 billion is unfathomable. Even $100 million. But to say that 70-something people got $1 million each -- I can find my way to that sort of a number. And if I can find that number, I can get really really angry at it.

Read an op-ed from an employment compensation law professor in today's New York Times. I won't link it, because nothing in it reflects even a nodding acquaintance with reality. Yes, executive compensation agreements are terminable for "cause", but incompetence is never cause. Employee incompetence is the fault of the idiot employer who didn't know any better when he hired you.

Yes, fraud is grounds for termination of an executive compensation agreement, but no one at AIG committed fraud. You could say that the corporate culture at AIG was fraudulent, but it is hard to pin it on any one single person, or group of people, especially this group of higher-end, but not highest-end, people getting the bonuses.

It was obvious from the start that they were selling pie-in-the-sky. It was also obvious, because they said it from the start, where they thought they found the pie. And why some banks felt it was worth eating anyway.

We are learning the hard way that Ralph Nader was right when he said that from the point of view of the poor person looking at the economy that there is no difference between the Democrats and Republicans. Different special interests line up behind different parties, but they all are feeding at the government trough. Things are run in a certain way because they benefit the most number of people on both sides of the aisle.

One problem with what Nader was saying of course, is that he was the one saying it. The other problem is that his correct diagnosis always seemed to lead to the wrong medication -- admit that Ralph Nader is God, and leave everything to him.

Obama is not like Nader, and not like Bush. He does not run around pretending to be king. And even if he was inclined to do so, no one will let him. Tough for those who long for the good old days (like last year) when it was always Daddy's fault. Now it is all, quite obviously, on us. Some call that socialism. I call it democracy.