AIG Falling

More on the AIG bonus debacle. Honest-to-freakin-Murgatroyd, everything was just going to business as usual for these CEOS? Didn't ANYone think, "Hey, maybe it would look better if I said I was going to take that bonus and GIVE IT BACK TO THE COMPANY?"

President Barack Obama declared Monday that insurance giant American International Group is in financial straits because of 'recklessness and greed' and said he intends to stop it from paying out millions in executive bonuses.

'It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay,' Obama said at the outset of an appearance to announce help for small businesses hurt by the deep recession.

Obama spoke out in the wake of reports that surfaced over the weekend saying that financially strapped American International Group Inc. was paying substantial bonuses to executives.

Noting that AIG has "received substantial sums" of federal aid from the federal government, Obama said he has asked Treasury Secretary Timothy Geithner "to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole."

A White House official told the Wall Street Journal that the Treasury Department will "use a planned $30 billion infusion into AIG to compel the company to repay the bonuses promised to employees of its financial-products group, which is responsible for selling the exotic financial instruments that brought the company to near-collapse."

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In a letter to Geithner dated Saturday, [AIG Chairman Edward] Liddy said outside lawyers had informed the company that AIG had contractual obligations to make the bonus payments and could face lawsuits if it did not do so.

More here at HuffPo.