Memo to comp cop: Cancel AIG's latest big buck bonuses

Updated

American International Group (AIG) is seeking more bonus money for its executives. You might remember AIG because as a taxpayer, you've given it $180 billion in your money to keep it from collapsing last fall and your money went to pay $165 million in bonuses to 400 employees of its catastrophically money losing Financial Products unit with another $200 million in the works for 2009. Of course, AIG is trying to deflect public outrage for its latest $2.4 million in executive bonuses onto the new comp cop, Kenneth Feinberg.

This might be good politics but it turns out that since the bonuses were approved before Feinberg started his job, they're outside of his jurisdiction. Do the AIG executives deserve bonuses? I think they certainly do -- as long as AIG is making a profit it should have the right to pay bonuses to its executives out of that profit. There's just one little problem -- AIG lost $99 billion in 2008 and $4.4 billion in the first quarter of 2009. That's a monumentally lousy performance which does not warrant a bonus.

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