Chaos at AIG

[snoopy369]

The fact that they aren't responsible for CDSes does not mean they bear no responsibility for other actions of their company.

Because ... ?

I thought you believed the 'evil capitalist masters' were responsible for everything, and their 'oppressed workers' were victims of their oppression. These people are cleaning up the messes of aforementioned evil capitalist masters (and, exceptionally evil and/or stupid varieties of said). Sounds to me like they're the oppressed ones here. Why aren't you on their side?

[chequita guevara]

I have much sympathy for the capitalist as the capitalist has for me, i.e., none. The fact that some of them are trying to clean up their own mess isn't altruistic, and it isn't for the benefit of the world. It's for their own benefit, to try and save themselves. And they're doing it by throwing everyone else overboard.

[snoopy369]

Why are all capitalists by definition evil? Couldn't some of them be nice people

And how are these INDIVIDUAL people throwing anyone overboard? They're trying to unwind complex messes others left, so that the economy isn't affected as badly as if they just dumped and ran.

Further, you didn't answer my question. How are these people necessarily capitalists themselves? Seems like they're doing actual work, ie labor, so doesn't that make them wage slaves, and thus class allies?

You're really off the deep end today...

[chequita guevara]

AIG Exec Whines About Public Anger, and Now We're Supposed to Pity Him? Yeah, Right
By Matt Taibbi, AlterNet
Posted on March 26, 2009, Printed on March 26, 2009

http://www.alternet.org/story/133627/

"I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down." via Op-Ed Contributor - "Dear A.I.G., I Quit!" - NYTimes.com

Like a lot of people, I read Wednesday's New York Times editorial by former AIG Financial Products employee Jake DeSantis, whose resignation letter basically asks us all to reconsider our anger toward the poor overworked employees of his unit.

DeSantis has a few major points. They include 1) I had nothing to do with my boss Joe Cassano's toxic credit default swaps portfolio, and only a handful of people in our unit did 2) I didn't even know anything about them 3) I could have left AIG for a better job several times last year 4) but I didn't, staying out of a sense of duty to my poor beleaguered firm, only to find out in the end that 5) I would be betrayed by AIG senior management, who promised that we would be rewarded for staying, but then went back on their word when they folded in highly cowardly fashion in the face of an angry and stupid populist mob.

I have a few responses to those points. They are 1) Bull**** 2) bull**** 3) bull****, plus of course 4) bull****. Lastly, there is 5) Boo ****ing Hoo. You dog.

AIGFP only had 377 employees. Those 400-odd folks received almost $3.5 billion in compensation in the last seven years, a very large part of that money coming from the sale of credit default protection. Doing the math, that averages out to over $9 million of compensation per person.

Ask yourself this question: if your company made that much money, and the boss of the unit made almost $280 million in just a few years, exactly how likely is it that you wouldn't know where that money was coming from? Are we supposed to believe that Jake DeSantis knew nothing about Joe Cassano's CDS deals? If your boss and the top guys in your firm were all making a killing selling anything at all -- whether it was rubber kayaks, generic Levitra or Credit Default Swaps -- you really wouldn't bother to find out what that thing they were selling was? You'd really just mind your own business, sit at your cubicle, and put your faith in the guys up top to fill you in if there was something you needed to know?

This would be a believable claim for an employee of some other wing of AIG, a company with well over 100,000 employees. But DeSantis works for tiny, 377-person AIGFP, a unit that had only two offices, one in London and one in Greenwich, Connecticut. And we're talking about financial professionals, the most shameless group of tirelessly envious gossips ever to walk the face of the earth. The likelihood that Joe Cassano would pull in $280 million for himself, and his equally greedy, hopelessly jealous employees wouldn't know not only exactly how he made that money but every last ugly detail about his life -- from what skank he's sleeping with to what side of his trousers he hangs on -- is almost zero. I know plenty of people who work in this world and I've met very few who didn't hate with every cell in their bodies anyone in their own companies who made more money than they did or got bigger bonuses at Christmastime. Gossiping about each others' bonuses, and *****ing about each others' compensation, is the national pastime for these people.

So forgive me if I don't buy this story that poor Jake and his buddies didn't know about Cassano's CDS business. Also, there's this: let's just say, Jake, that you're telling the truth, that you don't know anything about this toxic portfolio. If that's the case, then why the **** does anyone need to retain you at an exorbitant salary to help unwind that very portfolio? If these transactions aren't and never were your expertise, then where the hell is your value here? When I spoke to Christine Pretto, the AIG spokeswoman, and asked about those bonuses, she said that AIG needed to retain people like you in order to take advantage of your "knowledge of these transactions." So if you don't have knowledge of these transactions, what are you being paid for? Your winning attitude?

Then there's the matter of Jake's other job offers. About that: It was apparent as early as last February that Cassano had basically destroyed not only the unit but perhaps AIG itself. The company announced over $11 billion in losses around that time. If I'm Jake DeSantis, and I'm really innocent, I'm looking for a job that very instant. And I'm taking the first good job anyone offers me. Because by then I'd have realized that I was working for the latest version of Enron. That the man I've been working for for the last six or seven years has turned out to be one of the most irresponsible Wall Street villains of all time, a man who single-handedly destroyed the 18th-largest company in the world. If I'm Jake DeSantis, I'm quitting out of moral disgust, because I don't want to be associated with this kind of behavior.

The only reason I'd stay is if I didn't have a choice. Which I feel sure is what happened here. If Jake DeSantis didn't take advantage of an opportunity to get a better job elsewhere with a company that didn't hide billions in losses and make $500 billion bets with money they didn't have, that's his ****ing problem. The notion that I the taxpayer have to pay this ******* a million-dollar bonus because he turned down a better job at a less guilty company is repugnant to begin with; the notion that he stayed at AIGFP because he expected me to pay him this bonus makes me hate him even more. But it's all moot, because I feel quite sure it's a lie. As one trader for another firm told me not long ago when I asked what he thought about the need to pay these "retention bonuses" to these "valued employees" at AIGFP:

"Yeah, right. Who would hire these guys? They'd stay for a dollar if you offered it to them, much less a million."

I mean, half of Wall Street is unemployed right now. There are plenty of unemployed traders out there whose resumes don't include such entries as "Worked for years at small unit of AIG that helped destroy the universe; throughout that time was completely ignorant of burgeoning global disaster unfolding five feet from my desk." The idea that other companies would be so anxious to pass over the seas of truly innocent available people in order to scoop up some still-employed veteran of AIGFP -- and that they would be so enthusiastic in their pursuit of said AIGFP employees that AIG would need to pay those AIGFP folks million-plus retention bonuses to get them to stay -- is so ludicrous it almost defies comment. Show me, anywhere, the Wall Street firm that's willing right now to spend more than a million dollars poaching still-employed mid-level executives like Jake DeSantis, when they can just put an ad in the paper and have 500 recently-unemployed CEOs begging for work at almost any salary in five minutes. So the idea that the rest of Wall Street is breaking down AIGFP's doors to lavish its idiot personnel with million-dollar offers is just utterly preposterous. The fact that DeSantis expects us to believe this is insulting in itself.

Also, remember, DeSantis until this year was probably the recipient of performance bonuses. This year, obviously, there was no performance, so AIG doled out these "retention" bonuses instead. And the value of these retention bonuses is seriously in question if AIG never really needed to pay extra to retain this personnel, which I personally believe they didn't. I personally believe these "retnetion" bonuses were a ruse cooked up by management to suck a few more dollars out of the company before it sank to the ocean bottom. So if DeSantis is "owed" these bonuses it's only in the sense that someone up above agreed to cheat the shareholders by paying these bonuses out when they weren't really necessary; they weren't "earned" in any real sense.

But all of this is really secondary to the tone of DeSantis's letter. He acts like he's a victim because he didn't get to keep his after-tax bonus of $742,006.40 in the middle of a global depression. And he really loses his ****ing mind when he writes:

None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.

First of all, Jake, you *******, no plumber in the world gets paid a $740,000 bonus, over and above his salary, just to keep plumbing. Secondly, try living on a plumber's salary before you even think about comparing yourself to one; you're inviting a pitchfork in the gut by even thinking along those lines. Thirdly, Jake, if you were a plumber, and the electrician burned the house down -- well, guess what? If you and that electrician worked for the same company, you actually wouldn't get paid for that job. Out in the real world, when your company burns a house down, you're not getting paid by that client. It's only on Wall Street, where the every-man-for-himself ethos is built in to an insanely selfish and greed-addled compensation system, that people like you expect to get paid in a bubble -- only there do people expect their performance bonuses no matter how much money the shareholders lose overall, no matter how many people get laid off after the hostile takeover, no matter how ill-considered the mortgages lent out by your division were.

You expect that money because you think it's owed to you. But what money? The money is gone. Your boss, if not you, set it all afire. You want the money, but where exactly do you think it's coming from? Do you just not understand that that that money now would have to come out of someone else's pocket? That it would have to come from middle-class taxpayers, real plumbers, people who didn't make millions over the years in equity and commodity trading?

Here's the real problem with people like Jake DeSantis. Throughout this whole period they never were able to connect the dots -- to grasp the fact that when they skimmed a million here or a million there off the great rivers of capital that flowed through their offices, that that money came from somewhere, from someone. To them, it wasn't someone else's money, it was just money, and why shouldn't they have it?

It's remarkable that when DeSantis in his letter touts the reason he deserves his high compensation, all he can talk about is how much money he made: "The profitability of the businesses with which I was associated clearly supported my compensation." For a guy like this, his worth as a human being is wrapped up in buying a bag of beans for $10 and selling it for $11. He states this like it's a law of nature: he was a good equities and commodities trader, therefore he should make a lot of money. Only a person with a habitually over-inflated sense of self-worth could think he deserves a $700,000 retention bonus, even if it has to be paid by taxpayers, when in reality no one "deserves" that much money. It may be that some people do get paid that much, but most people who make that much money have enough sense to realize their cushy lifestyles are an accident of fate, of birth, of class, not something that is "supported" by some unwritten natural law of compensation.

Hey Jake, it's not like you were curing cancer. You were a ****ing commodities trader. Thanks to a completely insane, horribly skewed set of societal values that puts a premium on greed and severely undervalues selflessness, communal spirit, and intellectualism -- values that make millionaires out of people like you and leave teachers and nurses, the people who raise your kids and clean your parents' bedpans, comparatively penniless -- you made a lot of money.

Good for you. Consider yourself lucky. But your company went belly-up and broke, almost certainly thanks in part to you, and now you don't get your bonus. So be a man and deal with it. The rest of us do, when we get bad breaks, and we've had a lot more of them than you. And stop whining. Jesus Christ.



Matt Taibbi is a writer for Rolling Stone.

[DaShi]

Yeah, I read the "I quit" letter with a hefty dose of . Who does he think he's fooling?

[DinoDoc]

You know if you'd spend as much effort into getting marketable skills as you do in venting your spleen about how evil and despensible the people who are likely to give you a job are, you'd likely have a job by now.

[DaShi]

We're mad as hell and we're not going to take it! :wiglaf:

[snoopy369]

377 people is tiny? We have right around 500 people in my office, so roughly the same, and I have no ****ing idea what 80% of the people here do. And I work with more people in my office than most others in my office do...

[chequita guevara]

You know if you'd spend as much effort into getting marketable skills as you do in venting your spleen about how evil and despensible the people who are likely to give you a job are, you'd likely have a job by now.

Whether or not that it is true, it's utterly beside the point. I could work at Wal-Mart too and make snippy little comments and pretend I'm smart.

[Imran Siddiqui]

377 people is tiny? We have right around 500 people in my office, so roughly the same, and I have no ****ing idea what 80% of the people here do. And I work with more people in my office than most others in my office do...

QFT!

This idea that if you have under 500 people, you should know what is going on in every branch is freaking ludicrous. I work for a executive branch agency. We have about 40 investigators, 12 benefit advisors, and 10 managers/support staff (it's the biggest regional office in our agency) and I've been incredibly surprised what other regional offices do in their procedures and enforcement policy and we are enforcing the SAME LAW.

[Imran Siddiqui]

Whether or not that it is true, it's utterly beside the point. I could work at Wal-Mart too and make snippy little comments and pretend I'm smart.

At least you'd be somewhat useful working at Wal-Mart, making some money (even if its a small amount) and getting benefits.

[The Mad Monk]

Whether or not that it is true, it's utterly beside the point. I could work at Wal-Mart too and make snippy little comments and pretend I'm smart.

Then by all means, do so.

[DinoDoc]

Whether or not that it is true, it's utterly beside the point. I could work at Wal-Mart too...

Feel free. It was actually a decent job despite how much I whined about it. They also provide benefits which you might find useful about now such as health insurance.

and make snippy little comments and pretend I'm smart.

How would that be different from what you do now?

[Naked Gents Rut]

That was a pretty stupid Taibbi article, but I'll let it slide since I enjoyed his recent takedown of Tom Friedman so much.

[Kuciwalker]

Link?