Corporate Welfare You Can Believe In

In case you've been hanging out under a rock for the last week, there's been a bit of a scandal involving AIG. The insurance behemoth siphoned $165 million in federal bailout funds for "retention" (don't call it a 'bonus') awards to employees of the financial products division -- the same one that helped implode the economy. Someone leaked a few names of the recipients, and now all hell's broken loose. There is populist outrage!

AIG's CEO, Edward M. Liddy, went before Congress to complain that executives were receiving death threats on the interweb, that bastion of civility where there are no, you know, wackos or anything. Never mind that Senator Charles Grassley (R-IA) called upon them to commit harakiri.

According to an article in today's Times, an AIG flack said one executive, Douglas Poling of Fairfield, CT, who received a $6.4 million bonus, offered to return it, “because he thought it was the correct thing to do.” Says his PR guy. And his boss reports he's doing an "outstanding job" winding down the division for whose collapse he is also presumably partially responsible. It's like an arsonist hanging around to sweep up the ashes. Or a murderer joining the search and rescue team for his victim. And is handsomely rewarded for it. The article cites another source -- his daddy's servant -- who vouches that Doug is a really nice guy. Daddy is Harold A. Poling, a former chief executive of Ford Motor Company.

Another recipient of a multi-million dollar bonus, James Haas, choked back tears when asked how he was doing.

“I feel horrible. This has been a complete invasion of privacy... I didn’t have anything to do with those credit problems... I told Mr. Liddy I would rescind my retention contract."

Oh dear. We are faced with an economic collapse, a touch of cultural revolution, and this dude's biggest worry is that some people are trash-talking and there are reporters at the end of his driveway. His privacy is being invaded at his oceanfront property. Someone call Human Rights Watch.

The article doesn't state when Haas or Poling decided it might be best to return their bonuses. Perhaps only after they came under scrutiny and lived to cry about it.

It's also worth noting that Haas, Poling and another AIG exec who received a bailout bonus, Jonathan Liebergall, have all contributed generously to Senator Chris Dodd's (D-CT) campaigns in the past. Senator Dodd snuck in a last-minute bonus exemption into the bailout bill, and this has allowed AIG to argue that the government offered and they merely accepted, making everything perfectly legit. If so, it will be difficult to determine who is more culpable.

I might storm the Bastille too, but seem to have misplaced my battering ram. I'll just have to join the chorus for now.