American Morning
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March 18th, 2009
06:00 AM ET
What's on Tap – Wednesday March 18th, 2009
We’re continuing along the Road to Rescue this morning... Some of the biggest names and newsmakers in the economic crisis will join us.
- Donald Trump – He's getting sued again. He recently said the economy is the worst he's ever seen. Would he fire AIG execs?
- Senator Charles Grassley – He's the man who said AIG executives should resign or kill themselves. He's now backing off that a bit. Do you agree with him?
- Congressman Barney Frank – Many say he shares a lot of the blame for helping to put hundreds of thousands of people on the street. Today everyone will be watching Capitol Hill, as he faces off with AIG's CEO.
- McDonald's menu guru Karen Wells – The golden arches are only shining brighter during the economic crisis. Should there be more affordable healthy food on the menu?
- We also have Christine Romans and Gerri Willis taking your calls, e-mails and "tweets."
Here's are some of the big stories we're following for you today:
- The AIG payback – The Treasury Department says the insurance giant will have to give back $165 million it paid out in bonus money, but did the Obama Administration drop the ball as the rich got richer? The $165 million is pocket change compared to the tens of billions AIG placed in risky investments. Why isn't anyone talking about that?
- Following the stimulus dollars – President Obama wanted $150 billion in public works money on the street immediately, but is red tape choking recovery?
- Grocery wars. Major food companies passed the buck to you when fuel prices exploded last year. Now they're down. You're still paying. Why?
- Video game sales soaring in a rough economy. Movies got people through the Great Depression. Xboxes and Wii's are the way to stay home but still escape the harsh realities of a new millennium.
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Why not make AIG pay back the same amount of bailout money they received as what they paid out in bonuses. Forget about firing anyone unless this happens again and get this done with. It's time to move on.
AIG IS ANOTHER "MADE-OFF"! HOW COME THIS COMPANY KEEPS PASSING GO AND COLLECTING $200?! WHAT HAPPENED TO "OVERSIGHT"?! POLITICIANS KEEP PLAYING THE "BLAME GAME", FINGER POINTING NEEDS TO STOP,THERE IS PLENTY OF BLAME TO GO AROUND. AIG SHOULD HAVE TO PAY SOME TYPE OF PENALTY FEE FOR THEIR FLAGRANT MISUSE OF OUR TAX MONEY! MOST OF US ARE LIVING PAYCHECK TO PAYCHECK, HAVING TO MAKE TOUGH DECISIONS, BUY FOOD, OR PAY THE ELECTRIC BILL? I DO NOT UNDERSTAND WHY IT WAS SO IMPORTANT TO BAIL THIS COMPANY OUT? WHY COULDN'T THEY FILE CHAPTER 11? WHY IS THIS COMPANY SO IMPORTANT? THE BAILOUT FUNDS SHOULD HAVE BEEN DISTRIBUTED TO STRUGGLING AMERICANS INSTEAD, BAD MORTGAGES AND DEBTS WOULD HAVE BEEN PAID, THEREBY MAKING IT UNNECESSARY FOR THE MORTGAGE COMPANIES, CREDIT CARD COMPANIES, AND OTHERS TO RECIEVE THE BAILOUT IN THE FIRST PLACE!
I think its time the media, yours included stop constantly singing Obama,s paise and kissing up to him and start calling him on his compaign promises of reducing wasteful govt spending by going through them line by line. obviously he is not doing that, thats why he lets Chris Dodd and other slide past him legislation that ok,s outrageous bonuses like AIG,s. Am very disappointed, especially because i voted for him, believing in his message of change to washington.
When are we going to start using the "L" word with respect to Senator Dodd? No one seems to want to say that Senator Dodd LIED!...again..
I'm so tired of hearing no one take personal responsibility. We all gambled. We all have homes with decreased value. This mess didn't happen overnight so how can we possibly think any man, including President Obama, can "fix" it overnight. Meanwhile, if you don't have one month of savings for every $10,000 of income you make (say you make $60,000. Theory it will take you at least 6 mos to replace your job. Then you should have $30,000 less what your taxes would have been paid on that so about $20,000 in savings.) You don't and you're still working? Get it saved? You're in a house you never could have afforded of you'd gone with the traditional mortgage? You're part of the problem? And as to the AIG bonuses, shame on all of the news organizations for feeding this frenzy. Sure, it's sickening. But they're contracts. Can you imagine the litigation the country or company would have become embroiled in if we'd just said we're not going to let you honor the contracts you've entered into? We can cure some of this going forward, but lots of the people outraged now about these bonuses won't want to do what would be necessary to not have these same issues in the future. They're all hoping for the jobs that will pay them 7 figure bonuses. The country's collective greed has allowed the AIGs, Countrywides and Madoffs of the world to prosper. And they will c ontinue in the future.
Every morning, I hear someone else on CNN asking for a handout. It strikes me that these same people probably were cursing "welfare mothers" last year. The Madoff "victims" are not in the worse position in the world and they're not the first people to be taken. But they get TV shows (wonder how that happens – because they have powerful friends) and there's talk of changing the tax laws to benefit them. Welfare. And do you really think they're broke? Of course not. Lots of them are crying in their multimillion dollar homes along with Mrs. Madoff. Sell those homes and they'll live better than most of Americans could ever hope to live. I feel more pity for the folks in retirement who owned a few annuities and are fearful that we'll let an AIG or some other company paying these annuities go under.
I regularly watch your show every morning with my coffee and generally enjoy your reporting. However, it appears that your recent reporting concerning the AIG bonuses and the Obama / Dodd connection has been soft. Why don't you connect the dots???
The provision protecting the AIG bonuses was added by Dodd at the request of the Treasury Dept as you reported, but you fail to provide your viewers the complete story. Dodd and Obama were the #1 and #2, respectively, recipients of financial contributions from AIG!!! There's your motive for Dodd being dishonest and for the Obama administration requesting the change and then pretending they didn't know about it until it was too late.
Are you still a news network??? "We the people" deserve to know how entrenched our elected officials are in the Wall Street greed.
I would like to know why, no one is talking about the bonuses at FANNIE MAE and FREDDIE MAC. AIG is not the only one taking tax payers money and laughing all the way to the bank and most likely not a US bank.
Michael
It used to be that the size of the bonus was determined by how profitable the company was that year, no profit, no bonus. The whole idea of a "Retention Bonus" is absurd. With the economy like it is, where could they possibly go. Upper management getting a bonus while the company is trimming it's workforce to preserve cash flow is why the economy is not recovering.
Mine are questions and comments..
If someone took my money without my permission, wouldn't that be robbery? 'illegal'
If someone used scare tatics on me for my money, wouldn't that be extortion? 'illegal'
If someone threatened I would lose my job if I didn't give them money, wouldn't that be blackmail? 'illegal'
How much money do we have to give before we get an actual say in how it's spent? How many outside American countries and people do we have to help before we realize Charity begins at home? How long before the American citizens wishes are put into play instead of just heard then ignored? Yes I mean ignored. If I recall correctly most Americans said NO to the bailouts.
Why is it so important that auto companies get bailout money? Why are auto workers jobs more important that other fields of work? Why the preferential treatment?
I do realize how bitter this email sounds but at the same time I don't recall these questions being asked. I am a good hearted person and have given to charities when I could afford to. I believe it is wonderful to help people that are need but at the same time WE ARE IN NEED also. Where's our help? o000 wait its on its way. So sorry I must have gotten confused with all the BS thats floating around. Guess I will just sit back and watch what else will be taken from us, I am sure the wait won't be long.
Crisis and all theres no country better than ours. God Bless America and may the Good Lord help us all through this crisis we find ourselves in.
our government is not doing a very good job at what they do. yes they are the best going country, but at this point in time, lets face it. they suck! they aggred to AIG giving those bonuses. they must not have thought of what it would have done. $165,000,000? thats our bailout money! yes we [the tax payers] paid that money and its going to tax payers, but not enough. if we want this country to go on, we need to legalize marajuana and tax it. there are so many stoners out there that would buy it like its air! it wouldnt dig our economy out of this hole, it would rocket it out! we would be out of this hole faster than hilary lost the presidency. OR we could turn all our money into the government and they could give it back out evenly. but the rich peoples money is just to preciouse. OR we could become anarchist! keep the curency, get rid of the police, senate, president, councel, all of it! if someone shoots you, you best hope your friends will have your back. handle business on your own, dont go cry to the government. if you own a shop, then get a pump shotgun and put it under the counter. THEY WONT ROB YOU! if they know your packin', they dont wanna mess with you! they scared! but we should not be putting $1,000,000,000,000 into the economy, then we have inflation! not fun! now we arnt worth JACK! wtf obama???
I hope that Congress will also include a sur-tax on executive bonuses as well as severance packages. Who in their right mind would pay a departing employee millions of dollars for doing a lousy job; so here you go!
If "Joe the worker" on the floor or where ever does a bad job, he gets a pink slip and a bye and don't let the door hit you on the way out. For executives of some of these same companies, they get millions for not doing a good job and probably a pat on the back. Something is wrong with this picture. So I would like to see a 60% sur-tax on the bonuses and severance packages that these people get. To me a severance package should be nothing more than your last paycheck, but I would be willing to go maybe 3 months worth of pro-rated pay. That would be more than fair!
As far as the bonuses, whether you call it performance or retention for keeping the "best and brightess" makes no difference. If that bonus or compensation exceeds more than 30% of base salary, then 60% sur tax should be imposed on them. That includes stock options, and all the other little perks that anyone can dream up!
I'd be curious to know, so CNN, please investigate, of the 77 AIG bonus recipients, how many are executives whose compensation is controlled by AIG's Board of Directors (esp. its Compensation Committee). Who insures this Board? If they're found to be liable (pursuing Congressman Frank's suggestions for litigating against AIG for executive compensaton malpractice & malfeasance), the company providing their Directors' insurance will have to pay up.
From AIG's corp. website (http://ir.aigcorporate.com/phoenix.zhtml?c=76115&p=irol-govcommcomp), here's the hit list:
Compensation and Management Resources Committee
James F. Orr III, Chairman
Stephen F. Bollenbach
Dennis D. Dammerman
Suzanne Nora Johnson
Virginia M. Rometty
This group, according to its charter (attached), "approves the compensation of [CEO &] other senior executives under its purview, makes recommendations with respect to the compensation programs applicable to senior executives and other employee compensation..."
open letter To: Edward M. Liddy
As an AIG Shareholder, by default, I demand the board rescind all bonuses regardless of merit. I demand full disclosure of all recipients assets received through TARP funding and complete transparency from institutions receiving said funds. This is to include all accounts held by American citizens for the purpose of circumventing US tax laws. I demand any institution that fails to comply or hampers this investigation return any funds received through this process. I demand an independent audit of public record, and full prosecution for any violation. I demand this corporation be broken up and restructured and I also demand your resignation.
Taxpayer
While many of us are under great stress due to the economy and losses, I find it very distrubing that we even suggest that someone (in this case AIG Executives) commit suicide. Are we looking for someone else to blame, when we all contributed to this mess. Let us not loose our humanity. It takes all of us together to work out of this situation. We certainly are better people than to suggest our fellow man/woman commit suicide on our behalf!!
Plain and simple. If AIG doesnt get the bonus money back, they dont get any more from us. From the e mails i've been getting i understand most of congress has investments with AIG.
we are a country of law, of ,by and for the people not by the company for the company at the expense of the people
Plain and simple. If AIG doesnt get the bonus money back, they dont get any more from the taxpayers. We are the american people, why aren't we even asked who we give our money to. From the e mails i've been getting i hear that most of congress have investments with AIG. Maybe thats why its so important to bail them out.
Citigroup Bonuses To Smith Barney:
With the AIG bonus scandal, we can't allow Citigroup off the hook. Citigroup has allowed to distribute 3.5M in bonuses to Smith Barney.
We need to place Citigroup in the hot seat with AIG, after all Citigroup also received a Bailout!
Anonyms
Are we also watching companies such as J.P. Morgan Chase? They received 25 billion dollars from the government. Now there is concern that they will be moving jobs to India. Why would be allow this? I thought the money was to keep jobs in the United States.
There is only one reason congress is now so outraged about the bonuses. Once the news got out to the majority of America, and America started to scream for blood, the politicians figure they had better get on board. Don't kid yourself, Washington is just as dirty and guilty as any major company out there.
These AIG hyenas continue to cackle as they gnaw the last bit of meat of the American-tax payers bones. There cackle is only drowned out by the feigned outrage of our so-called congressional "representatives".
I'm a veteran of the Vietnam war and my wife and two children are living on veterans compensation of less than $2000. a month. We are deeply in debt to Banks and Finance institutiion. My family and I are asking the Federal Government of United States of America and it's tax payers for a bailout of $30,000. Dollars, to pay off debts and to help us through this economic crisis.
We Americans have developed a new syndrome: ADD-OCD. Gia (above) is the smartest girl in her college class AND this blog this morning! The cause of the ADD part: We've tried to pay attention, but there was SO MUCH!–We had no control massively-grotesque criminality of the Bush Administration–The still-not understood-devastation of the HUMAN casualties AND the billions and billions of dollars spent to break those lives in IRAQ–including private payoffs to Blackwater, Halliburton, and the likes; the Katrina horror; their insinuation into our privacy via "The Patriot" ACT; the INNUMERABLE attacks on our Constitution; REWARDING conglomerate after conglomerate, not just AIG–with TAX INCENTIVES–To Move Business AWAY from America,; and on and on and on... TOPPED OFF with not allowing GOVERNMENT OVERSIGHT. Powerless to change this, we impotently flit from one topic to the next, until most of our Media helps us develop our OCD: we focus almost exclusively on one area, forgetting the other massive crimes. This week: our ADD has settled into our OCD on the bonuses to AIG, forgetting their bloated SALARIES, their OTHER PERKS, and that there of HUNDREDS OF OTHER companies who HAVE DONE EXACTLY THE SAME THINGS! So while we're lambasting AIG, CNN, PLEASE help us delve into the other big-business criminalities: WALL STREET, CREDIT CARDS, BANKS, ETC. And one of the biggest travesties? That we became outraged at the LABORERS and UNIONS at GM and THE REST OF US "middle-class" workers have been PENALIZED with relatively-miniscule pay and benefits.
Instead of telling people to call their lenders direct, tell them to go to HUD.gov and search for a housing counselor in their area. tell them to contact a housing counselor, they speak the same language as the lenders and get loan modifications, intervene with foreclosures and in general, get things done with the lenders that borrowers can't.
The AIG (read: Allied In Greed) executive team is a degrace to the humanity
Everone is complanning about all the money being given out to these companys. No one mentions the Payrase that congress gave theirselves this year for doing nothing . I think we "the people "need to complain about them.
AIG bonuses, should be paid back. They should of never been given. It's like when the big 3 motor companies flew to DC in private jets to get their bailout. I have had a job since I was 13 years old. I'm 43 now, and this is not what I have been paying taxes for, for 30 years. LET AIG TWIST IN THE WIND. If they are allowed to keep their bonus, then they should have to pay them back by doing community service at minimum wage.
http://twitter.com/yeagerhood
http://yeagerhood2.ning.com
http://myspace.com/yeagerhood
http://youtube.com/yeagerhood
Chuck Grassley, for all his blather, is one of the people who did the corporations' will in GUTTING every sort of regulation on these Wall Street scumbags that made this mess inevitable. Why is HE not be held accountable?
How is it that Congress, Senate and the President can pass a bailout of 700 Billions Dollars, for AIG, an the people of "GUAM" USA, are still waiting for their war claims for over 68 years, which has pass congress but still needs the passaged of the Senate, stall their for almost two years. Please help the people of Guam for we suffered during the war, why must we continuely suffer for a just compensation we justly deserved.
Greg
Gerri,
My wife and I are typical middle class. We have 3 children, 1 Junior in college, 1 sophmore in High School, 1 8th grade. We had been saving for 15 yrs. and had enough for college. Since this started we lost 60% of retirement as well as college funds....HELP!!!
I know how to fix the whole problem.First and formost we yes we the poeple take this country back,from these clowns in d.c. who have no idea what it's like to be from the working class,I believe I read that 100% of the congress is multi millionaires,so how do they have a clue as to what we the working class need?Next let all these companys fail,or bail them out and start paying those of us who pay taxs divents on these companys income,don't pay the bounces to the exec.let them sue and see how it turns out infront of a jury of tax payers.As far as the car companys they shouldn't get a dime until the dirty rotten u.a.w. is desolved they are the ones who ruined our car market,because union workers don't get fired for doing a crap job building the cars and floor sweepers at 30.00 bucks a hour is crazy,remember the majority of assemble line workers are unskilled labor like min. wage earners.Don't give tax returns and rebates to people on public aid.Come on folks why do we let our gov. do this to us?We'll stand together againest a farren enemy but not a domstic one like our gov. has become.Like the saying goes,love your country but you better fear your gov.By the way weres my mortage bailout?Oh yea I bought what I could afford and pay the payments.Get a back bone middle class your a bunch of little sheep followers
It appears the elected officials are not worrying about any of this until the American people rise up in disgust and outrage. This speaks volumes to me. I guess voting them out on the next round might be a good idea. We just have to keep changing the dirty underwear every few years in hopes sooner or later, we might get a good group in there. Of course that is highly unlikely because they are all 'bought' before they even get in office. (sigh) I have lost all respect for the elected officials that are there on behalf of the people!
It's not just AIG. Wall Street firms who got BILLIONS in TARP funds posted $35 BILLION in collective losses, yet the still doled out $17 BILLION in BONUSES last fall. Why has THAT dropped off the radar?
Sen. Charles Grassley and most of the US congress should follow his advice.None of them are helping us.
Why are we wasting time with these mercenary CEOs? We SHOULD be grilling the people who are supposed to be running the companies: the boards of directors. It's THEIR failure that led to this mess. Why aren't THEY being held accountable for their absolute failure of corporate governance?
I would like to know what politicians took political campaign money from AIG the last five years and are they willing to pay it back since it's turning out to be tax payer money?, and did they vote on any deregulation bills that contributed to this financial mess. Thank you! Gordon Roberts Sparta TN
I'm too frustrated with the "unethical" practices of sleazy people being the sole reason our economy has tanked... and found Today's NYTimes op-ed Thomas Friedman column to put my anger into perspective.... if school teachers in MD earning $67,000/yr can give up a "contractual" 5% pay raise in order to save the system $89M so that programs and teachers can be saved, then AIG can take a hit for the country.
EVEN IF THE GOVERNMENT KEEPS ALL OF THE 30 BILLION FROM AIG THAT WONT MAKE IT RIGHT,THEY MUST GET BACK THE MONEY THAT WAS GIVEN OUT!!!!!! GIVE ME A BREAK WE AINT THAT STUPID
Didn't the first "bailout" occur while Bush was still in office? Yet many want to blame Obama who's only been in office for 2 months. Once the banks and financial institutions realized that monies were coming their way, they took it and ran. These companies knew there' d be a backlash, but didn't care because they already had the dollars. In this glorious capitalistic society we in, it seems that many don't seem to know when enough is enough. There's this insane desire to have more, and those who got these astronomical bonuses actually feel they deserve it, and have no shame in taking them even though they already get fat salaries.
Why aren't you telling the truth about AIG? They actually paid out $458 million in bonuses. Why should even the the 'so called' profitable portions of the company get bonuses when the whole enterprise failed? Tell the truth – please!
Ok folks, now this is one thing you can do a little something about. Even if you live in the city, in an apartment, you can raise some container veggies. I live in the country and raise a garden every year so the grocery stores have no appeal to me but look into a community garden space even. Lots of cities are doing that now. So if you can have fresh veggies and let the grocery stores keep their high priced food, wouldn't you do it???
Obtain a copy of the specific clause in the employment contract showing bonuses allowed when the receiver exhibits poor performance. Also, the clause regarding retension might be revealing.
As a college student, the AIG bonus scandal does not bother me. Especially if one consideres the billions wasted in Iraq. With the money used for the Iraqi war, all Americans could have been covered with Health Insurance
So...if I give you $160 million, you'll give me another $30 billion, right? Let me get my checkbook! At that exchange rate, I can hand out bonuses for 187 years! Give me a break! If we're losing money here, WHERE is it going? Somebody is getting rich and our lawmakers are letting it happen!
This whole AIG bonus thing is just another slight of hand trick to take our focus off the bigger picture.
WHY IS CNN IS LIBERALLY BIASED and always choosing comments and pundits that reflect their Liberally biased point of view? CNN advocates the liberal line, not reports. ALL "JOURNALISTS" on CNN ARE LIBERALS. Please DISCLOSE YOU PARTY AFFILIATION IN THE NAME OF JOURNALISM.
How is Iraq doing these days? Don't hear much about it anymore.
Democracy in the Heart of the Middle East.
If AIG were allowed to fail,
What would happen to all the Policys that they Insure?
Senator Charles Grassley spoke during a very emotionally charged moment and I certainly agree with him that dying with dignity might be the way to go for these people that are walking away with the taxpayer's money to live the life none of us are privy to at this moment. But asking a crook to commit suicide, is like asking them to feel bad about all those HIGH insurance payments people pay each year. Lets face it folks, insurance companies are the greediest business in the world. You get a break until they have to pay something, then watch your policy go up in cost!
people are blaming all these banks and companys like aig,for this mess we are in,our elected officials are as much to blame as them this train wreck has been coming for the last 20 years .with all the deregulation and politicians taking money from lobbyist.so the people of america have been asleep at the wheel and allowed our elected officials to do what ever they wanted to and got rich doing it,so they all share the equal blame for this mess as well as the american people,
I want my money back from 'AIG'.. I will no longer do business with 'AIG' or anyone affiliated with 'AIG'.
All I've heard for the past 4 days is outrage over $165 million paid mostly to British citizens. An outrage, sure. Aren't most of the "earmarks" bigger?
AIG got $162 Billion. The $165 million in bonuses is a bit over 1% of the total. I'll settle for any Government program that wastes only 1%.
Let's move on. It's a contract situation that our Congress missed. 1%, come on. Who cares?
when do we get our stock certificates for this monopoly company called AIG that we invested in????????????????
Dispite the Financial Markets, I need to fund my ROTH IRA for 2008. Which style Mutual Funds should I look at in my Fidelity?
I want my money back from 'AIG'..
AIG: If a company is not smart enough to avoid a contract that pays millions to under valued employees, maybe they are not smart enough for the company to be in business.