You know, I wish I wasn’t able to be surprised so much by ignorance these days, but sadly, the amount of ignorance on this planet keeps growing. Now, that being said, I myself am far from a genius; however, I pride myself on being able to see past the end of my nose.
Today, everybody seems to be all bent out of shape about the AIG bonuses. When you look at it in reality, it’s quite laughable. Here’s why:
First, AIG received $173 BILLION on bailout money. That’s billion, with a B. Now, the bonuses in question total $165 MILLION. That’s million, with an M. By the way, for those of you who don’t know, million is less than a billion, and in fact 165 million is less than .001% of 173 billion. So, in reality, it’s nothing when put in the proper context.
Secondly, employees are the most valuable asset of any company. So, in a lot of ways it makes sense for employees to get these bonuses. As I say this, I can hear people complaining about how people who fail shouldn’t get bonuses. On the surface, that is true, but we have to look at this through the prism of realism. When you take the time to do this, you can see the true upside to it, which I will get to in a moment.
What everybody seems to miss is that the government is complicit in this problem. The US government did not have to bail out AIG, but it did, and there is nothing we can do about it. It is what it is. Most importantly, the government gave AIG money with NO STRINGS ATTACHED. If you want to blame somebody, blame Congress for granting unlimited power to the treasury secretary, whoever it has been, or will be.
In short, AIG was given money to stay in business. AIG was given money to keep doing what it does. Right or wrong, that was the deal. Understanding that basic principle, one must conclude that in order for AIG to do that, they have to honor their contractual commitments to their employees. No company can survive without its employees. That is just a fact of business. More than that, if AIG doesn’t honor its contractual obligations, the employees can sue and receive even more money. Keep in mind that court proceedings can, and often do cripple productivity. This, of course, compounds the problem.
In terms of the bonus money, we must look at it properly. In order to do that, we must ignore the “class envy” reflex that many of us have. The point I’m making is that this isn’t about who got what. The point is that this $165 million should be looked at as private sector stimulus. People who receive bonus money often treat it as just that. A bonus. Now, I ask you, what do people do with bonuses? They *spend* them! While I agree that this path isn’t the best way to go about it, we are still talking $165 million being directly infused into the economy. This means that in the end, despite the way AIG got the money, we see capitalism in the process. Oh no!
Now before I go, let me clue you in on the best part. Even though it’s misguided, let’s go back to the fact that everybody is screaming mad about these bonuses. I’m fine with that, anybody who wants to be mad with AIG, go ahead. That’s great. Let’s say enough people get so angry over this tiny little business decision that they stop buying AIG’s products. What happens then? AIG goes out of business, that’s what.
Do you know what that’s called? That’s called “the free market”. ‘Member ‘dem days, kids?
That’s how our economy is supposed to work, and *THAT* is the bigger picture.
Popularity: 74% [?]
