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Congress spent yesterday grilling a guy who wasn't working for AIG when the infamous bonuses were drafted. Meanwhile, Fannie Mae—an organization that has requested $15 billion in bailout cash—plans to reward some of its top executives with AIG-like bonuses. (Thomas Lund, the guy in charge of Fannie's mortgage business, is slated for precisely $1 million.) Similar bonuses, yet to be revealed, may be in line for Freddie Mac. Add to all that bonus money a $10 million executive suite in the works for Citigroup (lucky recipient of $45 billion in bailout funds—you're welcome!).
The politicization of, say, Citigroup's decision to buy a Sub-Zero refrigerator does not bode particularly well for anyone who wants a quick return to boring, predictable market outcomes. But when you accept heaps of the public's money, you agree to run your company in constant fear of what is derisively referred to as "populist outrage."
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The New York Times reports that the Obama administration is worried that fast-rising populist fury at financial sector piggishness (post-bailout bonuses for the very people who dealt in credit-default swaps!!) may threaten its recovery plan. But I wonder if, in fact, we have the ideal recessionary spectacle to watch: call it How To Catch a Greased AIG. Just hang in there, Geithner et al., and don't let the slippery swine go. After refusing all demands for transparency in its use of the huge fall rescue loan, invoking privacy concerns, AIG squealed today: Now—for whatever it's worth—we've got the names of the trading partners who got big chunks of the money. "These are extraordinary times," an AIG spokeswoman explained to the Washington Post.
I confess utter lack of expertise here, but is there a reason not to aim for yet more public squirming by AIG, now on the bonus issue? Citing "privacy obligations," AIG refuses to name the 400 employees covered by the roughly $165 million bonus plan it claims is contractually binding. If those recipients were to get outed, is there a chance that at least a few among them—those, say, in line for more than $3 million—might be too embarrassed to collect? These are, after all, extraordinary times.
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Abby, you suggested calling the new Obama puppy "Government." I'd say how about calling the dog "Northern Trust Corp." Noco for short. Or maybe "Wells Fargo." (Welly). That way we can employ that old-fashioned doggy command, not much in vogue anymore: "Beg," whenever Welly comes to the president wanting treats, particularly after he just peed on our rug.
I can see by your post, and Sen. Bobby Jindal's response to the president this week, that conservatives are holding fast to that old Reagan motto: "Government is not the solution to the problem. Government is the problem." Holding fast, that is, despite all evidence. If there's any moment when that attitude is proving fantastically, stupendously wrong, it is this one. We can argue forever over whether a hands-off government got us to where we are today. But one thing is for sure: Only government—" a jewel of human association and an heirloom of human reason," in the words of Leon Wieseltier—can dig us out of this one.
Obama is by temperament such a conciliator, so judicious, that he is failing to embrace this triumphal moment for liberalism and what should be the new motto: "Good boy, Government!"
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