Personae Non Gratae

| When Stephen Colbert promised to lead an angry, pitchfork-wielding mob to A.I.G. headquarters last week, he was joking. The actual angry mob that stood outside A.I.G. headquarters yesterday chanting “shame on you” wasn’t. Nor are the literally bus-loads of protesters scheduled to visit A.I.G. executives’ homes in Connecticut this weekend. No wonder the company has issued a security memo warning employees to hide their company insignia and, at night, to “travel in pairs and always park in well-lit areas.” As large a role as A.I.G. played in the meltdown, do you think the company will get any credit if it helps spur the recovery? In this siege mentality, what is A.I.G.’s incentive to succeed? [%comments]


Jake

Management incentives & bonuses are suppose to be tied to performance and be in proportion to the amount of risk involved.

If executives can receive million dollar bonuses for completely destroying their business units and company; they never really had the incentive to succeed. They just had incentive to make a quick buck.

Jannah Swink

AIG doesn't have an incentive to succeed. (Although I think their version of "success" may be a bit skewed, judging by the 11 staff members who were paid a bonus after leaving the company.) That past incentive -- a chance at a share in millions of dollars in bonuses -- is obviously going out of style quickly. I've heard several economics commentators say giant organizations bogged down by toxic assets will have to be broken down into smaller pieces in order to weed out the "unhealthy" areas of the business before they infect the parts that were thriving. That seems to be a somewhat plausible solution to this whole mess but so far we're just pumping money into the system and hoping it will heal itself.

Bladt

The same people starting the lynch mobs today made Donald Trump a celebrity and the women of The Real Housewives of Orange County famous, and so on and so forth. This outcry smacks of complete hypocrisy. Complaining about $165 million in the greater scheme of the cost of this crisis would be like complaining that your soup was cold, as the Titanic sank. It's nothing but a trifling diversion.

I carrying on at http://shouldntbutdo.wordpress.com/2009/03/20/feeling-sorry-for-the-aig-guys/ , but I think this post gets my point across.

mfw13

Shame can be a very powerful tool....

Sonya

Wow. I say, let's work this out in a civil manner. No need to harass these executives and threaten their lives!

Jay

CNN was practically breaking out the BBQ sauce in their hyperbolic programming over AIG in the last couple of days. It is as if they never heard the Holmesian quote about "shouting fire in a crowded theater." It is one thing for satirists to hold pitch forks on late night TV and quite another for the major news network to be stoking flames to a height and temperature at which anything coming within range is bound to burn.

Paulette

The Freakonomics' Personae Non Grata article highlighted Steven Cobert's comedy and somehow implied that it inspired public unrest and dangerous outrage. I disagree. I believe Cobert reflected, in comedy, what the public was feeling and only related it as a reality. It is our right as citizens to disagree and protest but with restraint and respect for the safety of others. Those who thirsted for money and fame with a disregard for those in their wake should take responsibility for the anger that is expressed by the public outside their windows.

MarthaJane Proctor

All this money grubbing by the super rich is not all that surprising. My Dad, a furniture salesman and collector--no, we weren't among the super rich, told me it was harder to get a $1.00 from his wealthiest and best customer than to get $5.00 from his poorests who bought very little and very, very rarely. His big and most valued client owned a resort hotel on the beach in NW Florida. The only way my Dad could get $ out of him was to use his handicap, a severe hearing loss, and just hang around talking about fishing and the weather until he got paid something so he would move along. My Dad enjoyed a reputation as one of the very few people to be able to get this guy to part with a dollar.

Evan S.

If you need private security outside of your home because of fear for your safety over your business dealings, what is the lesson to be learned? The incentive might be to try and regain their good name and a measure of respect in the market place; qualities which motivate more American workers everyday than the skewed values of Wall Street.

Tyler

Class warfare is all fun and games until someone loses an AIG.

cirby

Remember: a couple of hundred SEIU-sponsored union employees protesting outside of an AIG office is newsworthy, but a couple of thousand Tea Party protesters complaining about the whole bailout mess? Hardly worth mentioning.

ceolaf

1) How might AIG help in the recovery? Can someone explain that to me? Are they going to...

Nope. I can't think of how the might do it.

2) Somone breaks your window. How much credit do they get for replacing it? Not a heck of a lot, right?

I don't mean that it is all AIG's fault, but a great deal of it is. How much do they have to help to balance out the $170 billion? They want credit? They don't need credit from us, because they've already gotten the cash!

3) What is their incentive to succeed? That's an iteresting question, or rather there are some interesting questions behind it. Would some kind of incentive beyond than their pay and their job security make a difference?

Historically, we know that AIG was not really motivated by making sure the economy did well. They were motivated by short and medium term profits. Why should we think that they would now be motivated by greater good, public good or health of the economy issues, beyond their impact on their compensation and job security?

So, I guess that's not such an interesting question as we already know the answer.

Read more...

david

Why isn't RICO an option? AIG, Lehman, Bear and Merrill were running a racket. Now the public is being held hostage. RICO has been expanded to cover all sorts of activities that don't resemble episodes of the Soprano's.

Brian

The AIG workers have every incentive to succeed. If it fails again and is not bailed out by government, it will go bankrupt and they will be out of work and probably out a lot of money. Keeping AIG alive gives them a livelihood.

BT

Look out Manchester United players and fans. Wear your jersey's inside out. It is not safe out there.

C. Larity

What's AIG's incentive? The beatings will continue until morale (and profit) improves!

RH

Following up on BT's comments, there's a replica jersey/kit of Man Utd on sale now but with the letters IOU instead of AIG.

HoiPolloi

Indictments might do the trick.

So far, AIG's motivations to succeed have brought down the global economy. Now they want to be sweet-talked into not screwing it up even worse? How about if they consider themselves lucky they're not in prison (yet)?

People who've lost jobs, healthcare, retirements and houses aren't in the mood to let the banksters who actually profited from those losses to go about their business as usual. AIG employees feeling a little less secure these days? Well, welcome to reality.

"Corporate Welfare United" might be a more apt logo for Manchester United jerseys.

Duncan

Incentive? Succeed?

I thought AIG was supposed to be in a government-managed bankruptcy liquidation.

I suppose it's normal for management to pilfer anything that isn't nailed down during liquidation, so those poor souls at AIG have reason to be surprised at all the death threats and bills of attainder - no credit committee would ever go to such lengths.

spoon

I was under the impression that the 'bonuses' where a set amount (or a set minimum) guaranteed in one of the employees contracts with AIG... to learn that 'SEIU-sponsored union employees' where the ones protesting makes me wonder how the union would feel if the mandatory raise parts of their contract where ignored in this financial crisis, especially with them protesting another company fulfilling their contractual obligations to their employees.