Six months ago, when they could clearly see they were in a whole heap of trouble, AIG kept spending stupid amounts of money on non-essentials. (And clearly, our definitions of essential are very different. One becomes vastly more pragmatic after being laid off while pregnant, loses health insurance and is unable to afford COBRA.)

If they aren't responsible with their own money, why am I supposed the believe they will be responsible with mine? They have no incentive to discontinue private jet quail hunting trips and bonuses with fancy names--they are too big to fail, so we'll keep paying them in order to pay to be their customers and then have our claims denied.

$4M bonus for running a company straight into the ground? Sign me up.

@InfiniTrent: AIG lost the right to retain the supposedly only qualified employees when they basically failed or all but went bankrupt .

And if that industry or job market is that bad those employees would've stayed anyway .

@perruptor: He/She is likely a temp employee. In that case they do NOT have to pay benefits or anything a full time person receives... In fact many places hire people as part time even if they work more than 40 hours.

Let's not even talk about how banks have tightened credit (the exact opposite of what they were supposed to do -and what they promised they would do- with the bailout funds) and raised fees (again, something they said wouldn't happen if they got bailout funds), so they can splurge on executive bonuses and keep nice-looking profit margins.

Give me a break, the bailout was an epic failure.

Sadly, all our outrage is incomprehensible to the corporate leadership. Half of them simply cannot understand that what they plan to do is wrong. The other half understand that it is wrong, but have no concept of accountability. They believe wholeheartedly that they're untouchable and they'll get away with it regardless.

From the base-level employee point of view, right now they're thinking "it's gonna crash & burn, so get as much green paper out of it as you can before you get that pink paper in your pay envelope."

Note to company CEO's.

NEVER invite the government into you business by asking them for a handout unless want them looking over you shoulder. Every congressman or senator is just looking for some sort of photo op or case to make them look better after handing you our (the taxpayers) money.

I don't know where you are, but in the USA, it's illegal for them to do this. I'd look into it with your state labor relations board or wage&hours division of the AG's office, or whatever is relevant. If they lay you off, you'll have time to sue them for unpaid wages and benefits.

People were predicting this EXACT situation as soon as they announced bonuses weren't allowed. In fact, I'm pretty sure I read a lot of those predictions here, on consumerist.

to be fair, the majority of AIG was properly run. it was just one division that made a colossal f up. the other divisions' personnel may deserve bonusess

"Cummings went on to say that no one is indispensable when there are thousands of qualified people out of work on Wall Street."

Excellent- finally somebody is telling them the same thing that their corporate HR probably tells the "little people" at the company...

Four million in retention bonus.....I call Bullshit! Let them leave and find work elsewhere.

@GZA: AIG is actually laying off some employees in all its divisions.

@savdavid: please study your political history more before making such poorly informed statements.

I'll be the first to agree that any exec that is responsible for the company's problems should not get any sort of bonus. However, when you're talking about people that had nothing to do with said problems and are responsible for bringing in a lot of money, we should take a rational, reasonable look at whether or not retention bonuses for them make good business sense and not just have knee jerk reactions.

@Valhawk: If the government let AIG tank would employees from all the divisions been laid off or just from the division that was failing? It would have probably would have been that all the divisions would have been effected. So I don't think that logic fly's. I work for a financial company and we were told we would receive no bonuses or pay increases next year due our "financial situation". I had nothing to do with the business decisions made as I am in IT (project manager). Sure I can complain but I am just grateful I have job which is what these bastards should be thankful for. Sometimes you have to take a hit for the team.

I say do it like they do us... I always remember seeing the Chase bank thing saying they give me 100$ on a new acct. Thats IF I keep the account for a year..

So let there be a string attached to this payout, drag it down the hall for a year not letting them touch it unless they do stay the full term. And with performance reviews.

It's where the all the bullets should be going.

If the Union members are canned and reasonable wages are payed instead, the auto industry makes money.

The results seem different to me.

We're dealing with a minor recession in the financial sector that seems more wide spread because the average person is stupid and panicky.

every one of these checks should have come with a tightass comptroller, a 600-page manual on proper uses of government money & a big DENIED stamp.

Coincidence, I'm sure.

The problem with the "one company, one treatment" approach is you are cutting off your nose to spite your face. Most of AIG's divisions are profitable - what killed them was the one that sold Credit Default Swaps, basically insurance on subprime mortgages - they seriously underestimated how many people would default. The problem is that if the people in the profitable divisions (auto, life, whatever) leave, then there is less chance of recovering any money, because you've killed off the parts of the company that are actually making money.

@TorrentFreak: Yeah, I think it's both sides of the political spectrum.

Be nice to see some mobs with torches and pitchforks...to bad it'd never happen...

This is a new reason. Aside from taking the failing banks "very seriously" they decided to ignore public opinion and congress and do like every other corp. does, what ever the hell they want. The world can burn for all they care so long as they have 3 summer homes in Milan, a Ferrari, and a nice pension worth $30 gazillion.

Its not just Bush. Its a pathetic, spineless, and worthless Democratic congress too.

They are all epic failures.

The financial market would never have crashed in the first place. Your statement is no different than saying we must ground all airline flights because one or two flights crashed.

The financially strong companies would not have had any problems borrowing...

I guess AIG is a success story. They have burned through $150 billion and still have enough for bonuses and luxury retreats and remain in business.

I guess AIG is a success story after all!

@johnfrombrooklyn: That's the thing that people don't get; these people WOULD find a job elsewhere. There are plenty of firms that would kill to have people this skilled working for them. It's not like some of the other jobs out there right now (i.e. house builders). There is a demand for people like this.

Thus, it is indeed worthwhile to keep them, as they will go elsewhere if not paid.

I don't have a problem with paying people to stay to clean up or fix the mess. But that's only if AIG is sure these people aren't able to jump someplace else. In today's job market, it seems the person that gets the $3 million retention bonus would probably have a tough time finding a similar job. And I'm guessing the person(s) who is getting the $3 million bonus was probably high up enough in the company that he or she should take some personal responsiblity for this clusterf**k.

Actually, I just caught wind that I should put out my resume... ,"actually Jonathan, I can't advise you in any direction, because I'd hate to say yes and then there be layoffs in the school district."

So...

@hustler: Mmmmm...brie.

@InfiniTrent: I think it is ridiculous. I work my butt off and didn't get a raise this year. Am I going to complain? No. Because no one got raises. And I'm not mad about it because I'd like the company I work for to stay in business so I have a job. The job market stinks for anyone and I think most employed people right now are just happy to have a job. The same should go for those execs. They should just be grateful they have a job.

@Trick:

Well, for one thing, the entire financial system hasn't collapsed, making it impossible for even very financially strong companies to borrow the necessary operating cash to do things like make payroll.

I for one have no pity for AIG upper mgmt.

Let it fail.

Where I work at, they are. The owner is fond of saying "if you get a paycheck every pay period, consider it meaning you doing a good job". Because seriously...if you don't perform here, your ass is out on the street the next day. I'd love to see some wallstreet fat cats try to hold a real job for a change.

You get a commenter retention bonus of 10 points worth of respect from me.

Hookers
Blow
Lobbyists

Lather, rinse, repeat.

@hustler: The Brie is a lie.

@SabreDC: They are getting my vote.

Executive bonus
Executive Retreat
More bonuses
Even more lavish retreat
Canceled retreat (too much bad publicity)
Yet another bonus
Secret retreat
"Retention payments"

@hustler: I'll miss the cake, though.

Anyone who didn't stand to benefit from these bailouts saw this coming from a mile away.

Business as usual for all parties involved.

OK internet smart dudes, again tell us how the bail-outs were for our own good and those who apposed it, called the out-right-scams for what they were stupid again.

Has there been *1* story on how these bailouts did some good?

I'm angry with AIG for spending taxpayer money in this manner.

I'm MORE angry w/ the legislators who passed the bailout - way to make sure the money went to the right things guys. Thanks. I feel WELL represented by my govt, let me tell you!

Next year we'll be hearing about how GM offered similar "retention payments" to their employees using our money.

Bailouts = fail.

That's right: everyone.

So this is where our BILLIONS are going! Err, I can't understand some of these companies. These crazy high figures make my head spin, but then again I'm just a regular working guy. I don't get $100K bonuses, ever. I should have went into finance/management, it's where all the money is, and currently going.

I say something smells fishy about this whole retention deal.

Hearing them talk about it you'd think that the financial sector was brimming with opportunity. I doubt half of these people could find a part time job at a Dunkin Donuts.

It looks like AIG is getting a headstart on the golden turd award for 2009. I guess they wanted to make sure they were in the running this time around.

I'm not saying they'd ALL leave, but if even a large number of key employees left, any company would be in trouble.

Its cool though, one day we'll chop their heads off and eat Brie.

"Oh, but they're the scammers that got them into this mess!" some will say. "Let 'em leave!" No, that's not all true. The majority of these folks weren't idiots, we can safely assume.

Is $3 million absurd as a "retention payment"? Yes. Is it unreasonable for a company to pay its best and brightest key employees to make sure they don't jump ship? No.