economy's failure is having a cascade of consequences for us peasants. My husband is looking for work again. His little company just handed out the last paychecks for who knows how long. Is there somebody I can punch?
See the article below by CBC's Henry Champ:
Lawmakers fume at excess of failed firm's execs
Wednesday, October 8, 2008 03:27 PM ET
By Henry Champ
(The full article is here:
http://www.cbc.ca/news/reportsfromabroad/champblog/2008/10/eyebrowraising_excess_at_the_t.html )
"Just when you thought you'd heard it all on the U.S. financial crisis...
You'll remember that $85-billion US taxpayer loan to the American International Group (AIG). That was made on Sept. 16. In return, AIG surrendered 79.9 per cent of its stock to the government.
Less than a week later, the company's executives, clearly to ease the mental strain they had been undergoing, pitched up at the exclusive St. Regis Resort at Monarch Beach in California.
It's not easy running a once-profitable insurance company into the ground, then waiting nervously for taxpayers to bail you out. The resort allowed these men and women to pull themselves together.
Unfortunately for some, the House Committee on Oversight and Government Reform got some copies of the bill.
In one week, AIG executives spent $440,000. There was $200,000 for rooms. Another $150,000 in food, $23,000 at the spa, $1,400 at the salon and $7,000 in green fees. Then there is the old favourite, the bar tab, which topped out at $10,000.
"They were getting facials, their manicures and their massages, while the American people were footing the bill," Maryland Democrat Elijah Cummings fumed during the oversight committee hearing."
http://www.cbc.ca/news/reportsfromabroad/champblog/2008/10/eyebrowraising_excess_at_the_t.html )
"Just when you thought you'd heard it all on the U.S. financial crisis...
You'll remember that $85-billion US taxpayer loan to the American International Group (AIG). That was made on Sept. 16. In return, AIG surrendered 79.9 per cent of its stock to the government.
Less than a week later, the company's executives, clearly to ease the mental strain they had been undergoing, pitched up at the exclusive St. Regis Resort at Monarch Beach in California.
It's not easy running a once-profitable insurance company into the ground, then waiting nervously for taxpayers to bail you out. The resort allowed these men and women to pull themselves together.
Unfortunately for some, the House Committee on Oversight and Government Reform got some copies of the bill.
In one week, AIG executives spent $440,000. There was $200,000 for rooms. Another $150,000 in food, $23,000 at the spa, $1,400 at the salon and $7,000 in green fees. Then there is the old favourite, the bar tab, which topped out at $10,000.
"They were getting facials, their manicures and their massages, while the American people were footing the bill," Maryland Democrat Elijah Cummings fumed during the oversight committee hearing."
"Now for the kicker.
Joe Cassano was president of AIG's financial products division. That's the group that trafficked in credit-default swaps (CDS). It was this trading that most analysts say brought down the insurance giant.
Under the terms of his contract, the committee heard yesterday, Cassano and his executive colleagues were paid 30 cents on every dollar these CDS products made. All told, Cassano made $280 million running this division, a fact that raised the ire of many lawmakers.
Ruining is perhaps a better word than running, since the division lost $11 billion, which led to the near-collapse of the company. Cassano was fired Feb. 29 of this year, but was allowed to keep $34 million in bonuses.
How can anyone receive a bonus for this kind of track record?
The horror story does not stop here. Cassano was then kept on as an AIG consultant at a salary of $1 million a month. That's not a typo. One million dollars a month.
Committee members asked why. The response, from former CEO Martin Sullivan: "I wanted to retain the 20-year knowledge of the transactions."
Joe Cassano was president of AIG's financial products division. That's the group that trafficked in credit-default swaps (CDS). It was this trading that most analysts say brought down the insurance giant.
Under the terms of his contract, the committee heard yesterday, Cassano and his executive colleagues were paid 30 cents on every dollar these CDS products made. All told, Cassano made $280 million running this division, a fact that raised the ire of many lawmakers.
Ruining is perhaps a better word than running, since the division lost $11 billion, which led to the near-collapse of the company. Cassano was fired Feb. 29 of this year, but was allowed to keep $34 million in bonuses.
How can anyone receive a bonus for this kind of track record?
The horror story does not stop here. Cassano was then kept on as an AIG consultant at a salary of $1 million a month. That's not a typo. One million dollars a month.
Committee members asked why. The response, from former CEO Martin Sullivan: "I wanted to retain the 20-year knowledge of the transactions."
"Sadly, the committee hearings will get less attention than the second presidential debate, which by any standard was a disappointment. The town-hall rules that governed this debate left no possibility of followup questions.
As a result, when Obama suggested AIG should be forced to repay taxpayers for the resort/spa fiasco and the company's executives should be fired for authorizing the retreat, McCain ignored the issue, and it died."
As a result, when Obama suggested AIG should be forced to repay taxpayers for the resort/spa fiasco and the company's executives should be fired for authorizing the retreat, McCain ignored the issue, and it died."
Hmmm. It's hard to say just how it feels to lose our income and well-being and possibly our house so that some of the ultra-rich can be bailed out and get massages and facials for all their trauma....
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