By Katie Wilson
The AIG scandal has the nation in a righteous uproar; the question that everyone is asking is this – with the company reporting losses in the fourth quarter to the tune of $61.7 billion, the largest loss in the corporate sector till date, and when $175 billion of taxpayers’ money was handed out by the Obama government to keep the company afloat for the sake of national interests, how is it possible that AIG gave out bonuses worth $165 million to its top derivative traders?
The money given to them was to be used to turn the company’s fortunes around, not to make the fortunes of the top brass in the organization. As President Obama put it, the initial collapse of the company was caused by recklessness and greed. The executives at AIG, instead of being grateful for the financial rescue and working harder than ever before to restore the company to its glory days, they’re only thinking of grabbing all they can and lining their own pockets from the bailout money – more displays of their greed and recklessness.
Could this blatant lack of ethics be considered white collar crime? Yes, it can. Because, in effect, it means that the traders at AIG are robbing the taxpayers to pay themselves huge bonuses that they are not worthy of in the first place. How does a company that reported the largest loss in corporate history justify paying its executives fat bonuses? How does AIG justify using the taxpayers’ money to pay out salaries and bonuses when the future of the company is at stake? Maybe they’re just doing what the head honchos at General Motors, Chrysler and Ford did when they flew down in the private jets to seek a bailout for the auto industry from the government?
When we talk of white collar crime, we often close our eyes to the moral and ethical wrongdoings that take place in the corporate world and focus only on the more blatant frauds being committed. But it’s the smaller drops that slowly contribute to the larger ocean, which is why it’s the basic greed of the corporate fraudster and the outright disregard that he/she shows for the common man that add up to the mess that is AIG today.
Even as Congress debates the initiation of a law that will allow them to tax the AIG executives and recoup the money given out as bonuses, the resignation of Jake DeSantis, executive vice-president in AIG’s financial products division which sustained some of the heaviest losses, is making news again because of his open tirade against his boss for failing to “defend his staff against the venom spewed by Congress regarding their well-earned bonuses”.
A fine way to earn a living isn’t it? Report losses worth billions, beg the government for billions more of the taxpayers’ money, and then take a huge chunk of this money for yourself as a nice fat bonus. Maybe we should all take leaves out of the books of the AIG executives this recession and write books that offer advice on how to survive a global economic crisis – take a bonus out of borrowed money and pretend that all is well!