It’s a matter of dollars and good sense.
President Obama lashed out at AIG today and called on the Treasury Department to “pursue every legal avenue to block these bonuses” – arguing that the insurance giant has no business doling out more money to its executives.
Obama’s tongue-lashing came as New York Attorney General Andrew Cuomo slapped American International Group with subpoenas for missing his 4 p.m. Monday deadline for providing details about the payments.
Cuomo said his office will investigate whether the employees who got the extra pay were involved in AIG’s near-collapse or if the bonuses were a violation of state law.
Cuomo said his staff was told by AIG that the company had mailed the bonus checks on Friday.
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Earlier in the day, Obama said it’s “hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?”
Over the weekend, AIG announced it was paying out the bonuses because it is contractually obligated to do so.
The feds have allotted $180 billion in taxpayer funds to rescue AIG after it posted major losses because of the troubled housing market.
Earlier this month, AIG announced a fourth-quarter loss of more than $60 billion, the largest corporate loss in history.
“In the last six months, AIG has received substantial sums from the US Treasury,” Obama said. “I’ve asked Secretary [Tim]Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole.”
Obama said that paying out the bonuses “isn’t just a matter of dollars and cents, but it’s about our fundamental values.”